Government Nears Completion of Massive Debt Restructuring Deal

The government has agreed terms with creditors on over 92% of its external debt, offering hope for economic recovery

The government announced on Thursday that they have reached an agreement, in principle, with creditors to restructure more than 92% of its external debt, marking a significant milestone in the country's efforts to emerge from a crippling debt crisis.

Secretary to the Treasury Felix Nkulukusa told officials that approximately $12.4bn of external debt has now been restructured, leaving just 7.8% outstanding with private creditors.

The restructuring process has been complex and lengthy, involving negotiations with multiple creditor groups including China, commercial bondholders, and other bilateral lenders.

Nkulukusa said negotiations continue with the remaining creditors, mostly private entities, to complete the final phase of the restructuring.

Officials expressed confidence about the nation’s economic prospects. The treasury secretary cited restored debt sustainability, increased mining production, and ongoing economic reforms as reasons for optimism.

“Zambia is projected to achieve robust economic growth of 6.4% in 2026”, outperforming regional peers, Nkulukusa said. The country's copper mining sector, which provides the bulk of export earnings, has shown signs of recovery as global commodity prices remain relatively strong.

The successful debt restructuring is expected to restore investor confidence and provide the government with more fiscal space to invest in development priorities including healthcare, education, and infrastructure.