- Title: Zambia's new president vows to cut 'unsustainable' public debt
- Date: 24th August 2021
- Summary: VARIOUS OF TRADITIONAL DANCERS
- Embargoed: 7th September 2021 19:15
- Keywords: Edgar Lungu Hakainde Hichilema Zambia elections new president public debt
- Location: LUSAKA, ZAMBIA
- City: LUSAKA, ZAMBIA
- Country: Zambia
- Topics: Africa,Government/Politics,Elections/Voting
- Reuters ID: LVA004ERN4GNB
- Aspect Ratio: 16:9
- Story Text: AUDIO QUALITY AS INCOMING
New President Hakainde Hichilema pledged on Tuesday (August 24) to tackle Zambia's "unsustainable" debt, lamenting that the national budget was overwhelmed by the cost of servicing it.
Hichilema spoke during his swearing-in as the southern African country's seventh president, after a landslide election victory earlier this month over incumbent Edgar Lungu.
It marked Zambia's third peaceful change of power to an opposition party since independence from Britain in 1964.
The new leader, who lost five previous presidency attempts, must now revive an economy weighed down by debt, unpredictable world commodity prices and COVID-19. Zambia became Africa's first pandemic-era sovereign default in November.
The 59-year-old former CEO of an accounting firm faces the unenviable task of striking a deal with a diverse bunch of rival creditors.
Of Zambia's $12 billion external debt, some $3 billion is in Eurobonds, $3.5 billion is bilateral debt, $2.1 billion is owed to multilateral lending agencies, such as the IMF, and along with another $2.9 billion of commercial bank debt.
A quarter of the total is held by either China or Chinese entities via deals shrouded in secrecy clauses - which makes negotiations for IMF relief particularly tough.
"We will pay special attention to lowering the fiscal deficit, reducing public debt and restoring social and market confidence in our country," Hichilema said.
In a sign that confidence in the major copper-mining country may be returning, Zambia's dollar-denominated sovereign bonds have climbed steadily since Hichilema's surprise victory, reflecting optimism that its debt crisis can be resolved.
Bonds have added around 10 cents across the curve, with the spread of the debt over safe haven U.S. Treasuries on Monday dipping below 2,000 points for the first time since March 2020.
(Production: Moses Moape, Siyabonga Sishi)
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