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Zambia agrees with China Development Bank to defer debt repayments

Zambia has reached deal with the China Development Bank (CDB) to defer debt repayments that were due this month, Zambia's government said, without giving the size of the debt or the repayments that were due.

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LUSAKA, Oct 28 (Reuters) - Zambia has reached deal with the China Development Bank (CDB) to defer debt repayments that were due this month, Zambia's government said, without giving the size of the debt or the repayments that were due.

"Under the terms of our agreement with CDB, interest and principal due on 25th October 2020 will be deferred. The deferred interest payment is now payable on 25th April 2021 and the deferred principal rescheduled over the life of the facility," the government said in a statement.

Zambia, one of the world's top copper producers, has been plunged into a debt crisis as the COVID-19 pandemic hurt its economy and exposed its public borrowing as unsustainable.

Holders of the country's Eurobonds ZM082877959=, ZM105638671=, ZM126708157= are embroiled in a standoff with the government that the markets fear could trigger a default. One of the sticking points has been whether or not other key lenders such as China would also agree to reschedule repayments.

Zambia's external debt is nearly $12 billion, including $3 billion of outstanding Eurobonds, $3.5 billion of bilateral debt, $2.9 billion of other commercial debt and $2.1 billion owed to multilateral institutions.

It owes some $3 billion to China.

(Reporting by Chris Mfula Writing by Tim Cocks Editing by Alexander Winning)

((tim.cocks@thomsonreuters.com))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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