Zambia has reached a deal for relief on nearly $4bn owed to private bondholders, raising hopes that a protracted debt restructuring by Africa’s second-largest copper producer is nearing its end.A committee of bondholders agreed to extend maturities and slash interest payments on terms matching recent breakthrough deals with China, Zambia’s biggest lender, and other official creditors, the southern African nation’s finance ministry said on Thursday.
President Hakainde Hichilema’s government has suffered a long delay in restructuring $13bn in external debt, including $3bn of foreign currency bonds, since a 2020 default under his predecessor.
Chinese and other official creditors failed for years to agree on where losses would fall, meaning Zambia’s restructuring was widely seen as a precedent for other developing countries that had borrowed heavily from Beijing. The process has also been viewed as a test case for a G20 “common framework” for sovereign debt restructuring.