DEBT RESTRUCTURING DEAL GOOD AS COLLAPSED-HON KAFWAYA
………says Govt. must Explain the scandalous clauses agreed in the Debt Restructuring deal that has been renounced
Lusaka………..Wednesday, November 29th , 2023 [Smart Eagles]
Lunte Member of Parliament Hon Mutotwe Kafwaya says the Debt restructuring deal the Government has been pursuing since assuming office is as good as dead.
Hon Kafwaya has cited alleged corruption and dishonesty in the manner the UPND Government is approaching the deal as the reason for the collapse.
He said the revelations that Government agreed to pay 2.5 billion between 2024 and 2025 to bondholders has annoyed the IMF.
He said Government agreed to give bondholders $2.5billion in 2024-2025 despite a running programme of $1.3billion with the IMF and despite the clear unaffordability of such an undertaking.
Hon. Kafwaya said instead of a haircut of 40% as demanded from China and others, Government agreed to only 18% haircut,contrary to the G20 Common Framework of equal debt treatment to creditors.
Hon Kafwaya said the face value of the new bonds was increased to $3.135 billion in both scenarios, exceeding the original $3 billion face value of the old notes.
He said the deal was established to be so bad that Zambia was directed to immediately renounce the corrupt agreement and place such an announcement on the London Stock Exchange.
“The agreement announced on 26th October 2023 with External Bondholder Steering Committee is so absurd that it has shocked the IMF, Official Creditor Committee headed by China and France. Explain the scandalous clauses agreed in the Debt Restructuring deal that has been renounced,” he said.
Hon Kafwaya said Government is being viewed as having entered into a corrupt deal and pushing Zambia back again into a debt distress.
And Hon Kafwaya stated that the carelessness of the UPND is now costing the nation.
He said it is embarrassing for the UPND to be entering into corrupt deals with bondholders.
Hon Kafwaya said the only way of coming out from the economic hardship is for the UPND to begin to be more honest with governance matters.
“Going back to debt distress when the economy is in bad shape. What we are going to see now in the next one month is high cost of living beyond reasonable measure,” he said.