ZAMBIA has been granted a Debt Service Suspension Initiative (DSSI) by the Chinese Government and all concessional facilities as provided by the G20 Guidelines.
Zambia has also been given a one-year grace period and suspension of three years repayment. China has suspended the maximum debt service repayment for 2020 and rescheduled it amounting to $225million which was due between May 2020 to December 2020.
Debt suspension for 2021 and 2022 amounting to $426.3million and $428 million have been suspended and rescheduled.
The main Chinese creditors include Export Import Bank of China, China Development Bank, the Industrial and Commercial Bank of China among others for loans obtained under infrastructure funding.
This information was disclosed in response to Euro Bond holders and investors prepared by Ministry of Finance and Lazard Freres who government has hired to help with financial and debt advisory services.
The document has since been posted on the London Stock Exchange. According to the document, Government had submitted a bilateral request to the Chinese government for debt service suspension on Government to Government (G2G) facilities.
“The Chinese Government has since agreed to grant DSSI for all to G2G facilities and all concessional facilities as per G20 guidelines of one-year grace period and three years repayment”.
The Zambian government is also engaging Chinese commercial facilities. It has since engaged Sinosure an insurance firm that has insured the commercial loans. These talks are underway on the possible deferment of interest repayments. The document stated that engagements on debt service related to China have been successful.
Earlier this year, Government proactively engaged the Chinese Government and creditors to obtain the Debt Service Suspension Initiative.