Economist Backs Zambia's Eurobond Buyback Plan

Economist and University of Zambia lecturer Professor Lubinda Haabazoka has welcomed the Government's decision to buy back part of its Eurobond debt, calling it a significant step towards lowering future debt costs and strengthening public finances.

Professor Haabazoka said the operation targets more than US$1.3 billion worth of bonds issued under Zambia's debt restructuring programme. He noted that these bonds carry commercial and step-up interest rates that become more expensive over time, unlike the concessional loans offered by institutions such as the African Development Bank.

Repurchasing and permanently cancelling the bonds, he explained, will reduce future debt obligations and eliminate long-term interest payments. The buyback, financed largely through a US$600 million AfDB facility, is expected to lower financing costs, improve debt sustainability and ease pressure on public finances.

According to Professor Haabazoka, reduced debt servicing costs could free up budget space for investment in health, education, agriculture and infrastructure. He said the AfDB's support reflects growing confidence in Zambia's recovery and the fiscal reforms being implemented under the New Dawn administration.

The transaction, he added, marks an important shift from crisis management to proactive debt reduction, placing Zambia on a stronger financial footing for long-term growth.