Zambia’s Chinese debt nearly double official estimate, study finds

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JOHANNESBURG, Sept.28 (Reuters) – Zambia’s debt to Chinese public and private lenders stands at $ 6.6 billion, nearly double the amount disclosed by the previous Zambian government, an analysis of the data estimated. loan from the China Africa Research Initiative (CARI).

Copper-rich Zambia became Africa’s first sovereign default in the coronavirus era last November, and its ongoing debt restructuring has become a test of Western multilateral efforts here to get countries to fully disclose their borrowing.

The former Zambian government led by Edgar Lungu said its Chinese debt stood at $ 3.4 billion. But the estimate released by CARI on Tuesday is consistent with recent comments by newly elected President Hakainde Hichilema, who took office last month, that the debt burden is likely higher.

The country’s international creditors, with whom the government is in talks, have complained that the lack of details on Zambia’s loans to China – which have specific non-disclosure conditions – has hampered the restructuring process of the debt.

“Given the complicated situation … reaching consensus on burden sharing is likely to prove exceptionally difficult,” wrote the CARI researchers who made the new estimate, Deborah Brautigam and Yinxuan Wang.

The new figure of $ 6.6 billion is based on Chinese loan data collected by CARI at the Johns Hopkins University School of Advanced International Studies. It is likely to continue to grow because it does not include penalties or interest arrears that continue to accumulate.

China is Africa’s biggest creditor. He is part of the Debt Service Suspension Initiative backed by the World Bank and the International Monetary Fund, which has temporarily frozen debt payments to dozens of the world’s poorest countries, but he is urged to do more in terms of disclosure.

Tuesday’s study estimated that $ 7.77 billion in loans to Zambia and its state-owned enterprises were disbursed by 18 major and minor Chinese banks or funds from 2000 to August 2021. Among these, Zambia has reimbursed at least $ 1.2 billion.

Their estimate does not change Zambia’s total indebtedness of $ 14.3 billion, according to the researchers, but shows that the Lungu government “has not been transparent about the significant weight of Chinese financiers among its many external creditors” .

Bwalya Ngandu, finance minister under Lungu, said it was not true that Zambia’s debt figures were underestimated. “We have never hidden any debt,” he said in a statement earlier this month.

The researchers found six cases where Chinese lenders forgave Zambia’s debt, totaling $ 392 million. (Reporting by Helen Reid in Johannesburg; Additional reporting by Chris Mfula in Lusaka; Editing by Marc Jones and William Maclean)

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