Zambia joins Ghana in its quest to restructure its debt under the G20 Common Framework

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Much like Ghana, the Southern African nation of Zambia is in need of debt restructuring.

On Monday (January 23, 2022), the president of Zambia Hakainde Hichilema, called to his country’s creditors to restructure Zambia’s debt, so as to give the country some breathing room to economically recover.

He made the statement to the Managing Director of the International Monetary Fund, Kristalina Georgieva, who paid a visit to Zambia and met with the country’s Finance Minister, Situmbeko Musokotwane, central bank governor Denny Kalyalya and other senior government officials.

“If (the debt restructuring is) not concluded soon, it is going to distort all the good efforts that we have been making to reconstruct the economy and bring investment,” the president said, while addressing the IMF director.

He also proposed a timeline for the debt restructure, owing to the urgency required of this initiative. He stated that if the country’s creditors could restructure the debt by the end of Q1 of 2023, it would “help a lot to open up areas that are sometimes causing negative sentiment”.

Kristalina Georgieva has openly advocated for a more urgent response to Zambia debt relief. She also noted that she would love for Zambia to become the second nation after Chad to complete a debt treatment process under the Group of 20 major economies’ Common Framework.

The IMF director,also commended Zambia for being responsible with state funds. She noted that it is admirable that so far, the Zambian government has eliminated some of its careless expenditure and has instead used the country’s resources in a sustainable way.

On the same subject, the U.S. Treasury Secretary Janet Yellen, also noted during her visit to Zambia that it would be critically important to restructure the country’s debt.

“I specifically raised the issue with Zambia (with Chinese officials) and asked for their cooperation in trying to reach a speedy resolution. And our talks were constructive,” the U.S Secretary Treasurer stated.

Ghana’s request to restructure its debt under the G20 Common Framework seemed to bear some promise as the G20 countries showed interest in helping Ghana restructure its debt.

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