Zambia’s recent trip to China aimed to smooth out a bumpy road in its debt restructuring journey. Officials met with representatives from the Export-Import Bank of China (EXIM) and other commercial banks, hoping to reach a new agreement. This comes after a previous deal with international bondholders hit a snag in November.
Remember, Zambia defaulted on its debt in 2020, and getting things back on track hasn’t been easy. The country is following a process called the G20 Common Framework, which aims for fair and comparable debt relief from both government and private creditors.
Here’s the key part: China, a major lender to Zambia, wasn’t happy with the initial deal offered to bondholders. They felt it wasn’t generous enough and wanted more debt relief for themselves.
But there’s good news! Zambia’s officials say they’re on the right track. They’ve shared their restructuring proposals with Chinese lenders and are optimistic about reaching an agreement soon.
