ZAMBIA’S EXTERNAL DEBT SERVICE FALLS BY 90 MILLION IN 2025
Zambia’s external debt service fell by 90.9 million dollars in 2025 to 575.1 million dollars, according to the Bank of Zambia 2025 Annual Report.
The report said the decline was driven largely by lower debt service on the restructured Eurobonds. The total comprised 292.1 million dollars in principal repayment, 275.2 million dollars in interest payment, and 7.86 million dollars in charges.
Servicing of the Eurobond debt resumed in 2024 after an agreement was reached with bondholders in March of that year, leading to a payment of 338.57 million dollars that included an upfront principal repayment and restructuring-related costs such as consent and advisor fees. That figure was reduced to 239.96 million dollars in 2025. Eurobond payments nonetheless accounted for the largest share of the total debt service bill, at 41.7 percent.
The report stated that bilateral repayments resumed in 2025, particularly on the settlement of past due interest, reflecting continued progress on agreed restructuring terms. Multilateral debt service increased moderately, mainly to the World Bank Group and the European Investment Bank.
The stock of private sector external debt declined to 5.9 billion dollars from 6.7 billion dollars in 2024, as repayments exceeded disbursements on both new and existing obligations. The reduction was largely driven by a 36% net fall in debt to multilateral institutions and a sharp net decline in debt to financial institutions.
Public and Publicly Guaranteed external debt stood at 17.51 billion dollars at the end of December 2025, a modest increase of 4.2% attributed to disbursements by multilateral creditors and the inclusion of accumulated interest in restructured loans. Despite the rise, the report said the PPG external debt-to-GDP ratio declined to 60.9% in 2025 from 66.4% in 2024, owing to a higher nominal GDP relative to accumulated debt.
The Central Government held the bulk of the PPG external debt at 92.2%, equivalent to 16.14 billion dollars, while government guaranteed debt amounted to 1.37 billion dollars. Most of the Central Government external debt was owed to commercial creditors at 33.8%, closely followed by multilateral creditors at 33.7 percent, bilateral creditors at 26.8%, and plurilateral creditors at 5.7%.
The report also said export proceeds tracking improved sharply in 2025, with the repatriation rate rising to 85.6% from 82% in 2024. Total export proceeds of 11.8 billion dollars were recorded in the Electronic Balance of Payments Monitoring System, of which 10.1 billion dollars was repatriated through the domestic banking system.
The Bank said it had undertaken a comprehensive redevelopment of the e-BoP Monitoring System to strengthen the accuracy, timeliness, and completeness of export proceeds data capture and reporting.