Zambian President Hakainde Hichilema has called on French President Emmanuel Macron to use his country’s influence to speed up Zambia’s delayed debt restructuring talks. The two leaders met in Paris on Wednesday, where Hichilema stressed the importance of concluding the talks before the June 22-23 Summit for a New Global Financial Pact that France will host. The summit aims to boost crisis financing for vulnerable countries in the Global South.
Zambia defaulted on its sovereign debt in 2020 and has since struggled to agree on a relief deal with its external creditors. The country’s Finance Minister Situmbeko Musokotwane told Reuters last month that Zambia was being unfairly “punished” as restructuring talks dragged on. Many Western officials have blamed the delays in agreeing to debt relief on Zambia’s largest bilateral creditor, China, something Beijing denies.
Hichilema’s office said the talks with Macron were productive, and Zambia was pleased with “President Macron’s commitment that Zambia’s debt restructuring program should conclusively be dealt with before the June summit for a new global financial pact.” The statement further urged France and China to work together on the restructuring and leverage the Paris Club of Creditors Committee and the G20 to ensure a speedy resolution.
France and China co-chair the committee of Zambia’s official creditors. Zambia sent a debt restructuring proposal to its official creditors last month, and IMF Managing Director Kristalina Georgieva has said creditors were set to meet this week to consider it.
Zambia’s debt has become a significant concern for its citizens as the country continues to struggle with the economic impact of the COVID-19 pandemic. The debt, which stands at around $12 billion, has become unsustainable, and Zambia’s government is under pressure to come up with a workable solution.
The Zambian government has been working with creditors to restructure its debt since late 2019. However, progress has been slow, with some creditors demanding tougher terms than the government is willing to accept. The Zambian government has sought to negotiate a deal that allows it to meet its obligations while also avoiding austerity measures that could harm its citizens.
Zambia is not alone in struggling to manage its debt. Many other African countries have also been grappling with high debt levels, which have been exacerbated by the pandemic. The International Monetary Fund (IMF) has warned that debt levels in many African countries have become unsustainable, and has called for debt relief and restructuring to help these countries recover.
The Zambian government has taken steps to address the debt crisis, including suspending some infrastructure projects and cutting spending. However, these measures have not been enough to prevent the country from defaulting on its debt.
The debt crisis in Zambia has highlighted the need for a more comprehensive approach to debt management in Africa. Many experts have called for debt relief and restructuring, as well as increased investment in the continent’s economies to support growth and development.
Zambia’s debt crisis remains a significant challenge for the country, and it is clear that a speedy resolution is urgently needed. The meeting between President Hichilema and President Macron provides hope that progress can be made, and a deal can be reached before the June summit. The international community must continue to support African countries struggling with debt, and work towards a more sustainable and equitable approach to debt management.
