Zambia will not pay US$750 million Euro Bond, predicts Andyford Mayele Banda

By Kwilanzi News Zambia

Opposition People’s Alliance for Change (PAC) Leader Andyford Mayele Banda says Zambia will fail to pay back the 750 United States Dollars Euro Bond, issued in 2012, which is due in 2022 after it was contracted by 5^th Republican President, the late Michael Chilufya Sata.

Since the initial 2012, procured by former Finance Minister Alexander Bwalya Chikwanda and former Finance Deputy Minister, Miles Sampa, now serving as Lusaka mayor, Zambia has to date issued three Eurobonds worth US$ 2, 775.

A US$750 million Euro Bond was sourced in 2012, US$1 billion in 2014 which are due to be paid in 2022, 2024, respectively, while the US$1.25 billion Euro Bonds issued in 2015 will be due for repayment in 2027.

Mr. Banda said in an interview in Lusaka that Zambia may erroneously think that the menacing covid 19 is a blessing in disguise on leveraging to re-negotiate the debt repayment, contracted to improve ZESCO operations, revitalizing Zambia Railways and the Development Bank of Zambia (DBZ)).

Zesco Limited was given US$255 million to implement capital projects, the Development Bank of Zambia got US$20 million to support small and medium enterprises and the Zambia Railways Limited US$120 million for the rehabilitation of infrastructure.

However, cautioned that the challenge of covid 19 could not be used as a basis on which to dodge the 2022, 2024 and 2027 repayment schedule as lending countries are equally grappling with economic challenges and not insulated from the Coronavirus burden.

Policy Monitoring and Research Centre (PMRC) Executive Director Bernadette Deka and Consumer Unity and Trust Society International (CUTS) Centre Coordinator Chennai Makumba have signed a Memorandum of Understanding (MOU) for collaboration in Joint Research, Policy Analysis, Information Dissemination and Event Co-Hosting.

Dr. Bwalya K.E Ng’andu

On her part, Policy Monitoring and Research Center (PMRC) Executive Director Bernadette Deka-Zulu advised the Finance Ministry Dr. Bwalya Ng’andu to give regular updates on the Sinking Fund and viable proposed redemption strategies designed to raise money to repay the US$750 million Euro-bonds due in 2022.

Talking of ‘The Elephant in the Room’, Ms Deka-Zulu encouraged Dr. Ng’andu to engaging the IMF for technical assistance and possible bailout package that will once adhered to signal stability of the economy to bondholders and investors.

Alluding to Zambia’s 2019 Energy Policy, Ms. Deka-Zulu re-echoed the need to improve the creditworthiness of ZESCO as the sole off-taker in order to instill confidence in private sector investors seeking to purchase energy generated.

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