Zambia’s efforts to restructure its $3 billion debt with international bondholders appear to be moving forward.
According to sources familiar with the situation, a non-disclosure agreement (NDA) has been signed between the government and a creditor group steering committee.
This NDA paves the way for formal discussions on a debt rework proposal submitted by the government last week.
The news comes after a positive development in late February when President Hakainde Hichilema announced agreements with China and India, the last remaining official creditors.
These agreements raised hopes for a swift conclusion to the protracted restructuring process.
However, previous deals with bondholders were rejected by official creditors who felt they weren’t offered comparable debt relief.
The exact details of the new proposal remain confidential due to the NDA.
Zambia defaulted on three separate bonds in 2020, 2024, and 2027, becoming the first African nation to do so during the COVID-19 pandemic.
The ongoing restructuring process has faced several hurdles, with the rejection of bondholder deals being the most recent setback.
Reaching an agreement with all creditors is crucial for Zambia’s economic recovery.
