{"id":31534,"date":"2022-09-18T20:04:51","date_gmt":"2022-09-18T20:04:51","guid":{"rendered":"https:\/\/www.africa-press.net\/zambia\/all-news\/zambias-bond-holders-slam-imf-debt-relief-target-as-arbitrary"},"modified":"2022-09-18T20:25:49","modified_gmt":"2022-09-18T20:25:49","slug":"zambias-bond-holders-slam-imf-debt-relief-target-as-arbitrary","status":"publish","type":"post","link":"https:\/\/www.africa-press.net\/zambia\/all-news\/zambias-bond-holders-slam-imf-debt-relief-target-as-arbitrary","title":{"rendered":"Zambia\u2019s bond holders slam IMF debt relief target as \u2018arbitrary\u2019"},"content":{"rendered":"

Africa-Press – Zambia. <\/strong><\/span>Reuters reports that Zambia\u2019s international bondholders have criticised the International Monetary Fund\u2019s debt restructuring framework as \u201carbitrary\u201d and for excluding the country\u2019s domestic debt, sources involved in the process have told Reuters.<\/p>\n

Zambia has been in default for almost two years and an IMF Debt Sustainability Analysis published last week called for its debt-service-to-exports ratio to be cut to a 140% \u201cthreshold\u201d from 153% quickly and to 84% by 2027.<\/p>\n

\u201cNow, all of a sudden, they have an arbitrary 84% number,\u201d said Kevin Daly, head of emerging market debt at Abrdn, who chairs a committee of bondholders estimated to hold around 45% of Zambia\u2019s $3 billion worth of international market debt.<\/p>\n

\u201cHow did you arrive at that number? It\u2019s such a different figure than the (140%) threshold,\u201d he told Reuters, calling on the IMF to meet with bondholders, who have complained of being left out of the loop as the IMF and bilateral creditors worked out a plan.<\/p>\n

IMF spokespeople did not immediately respond to a request for comment. Zambia\u2019s much-delayed debt restructuring is seen by analysts as a test case for what are expected to be a spate of defaults in poorer countries that have borrowed heavily not only in the capital markets but also from countries including China.<\/p>\n

David Malpass, president of the World Bank, the IMF\u2019s sister organisation, said last week that \u201ca deep debt reduction of 45% in net present value (NPV) terms\u2026 is essential.\u201d Relief of that magnitude \u201cwould not be acceptable (to) creditors\u201d, including Chinese lenders, Daly said.<\/p>\n

He declined to say what other bondholders would agree to, but said that from his perspective, \u201cIf it was something more in the\u2026 20-30% range, I think that would be acceptable.\u201d A bond recovery value of $65 to $75, with an exit yield of 11-12% was \u201crealistic\u201d,\u201d he said.<\/p>\n

Bondholders are also unhappy that $11.6 billion of local currency debt, $3.2 billion of which is owned by foreign investors, is being excluded from the restructuring, a second source involved in the process said.<\/p>\n

The person, who is familiar with the committee\u2019s position but spoke on the condition of anonymity, said it implied that such debt would effectively then have precedence over the Eurobonds, which are governed by international laws.<\/p>\n

He also questioned whether it would be right to include local currency debt not subject to restructuring in the debt targets, as it \u201csqueezes the amount of debt service that\u2019s available to service external debt.\u201d Still, he said, bondholders were \u201cmindful\u201d that restructuring local debt could cause issues in Zambia\u2019s banking sector.<\/p>\n

For More News And Analysis About Zambia<\/a> Follow Africa-Press<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Africa-Press – Zambia. Reuters reports that Zambia\u2019s international bondholders have criticised the International Monetary Fund\u2019s debt restructuring framework as \u201carbitrary\u201d and for excluding the country\u2019s domestic debt, sources involved in the process have told Reuters. Zambia has been in default for almost two years and an IMF Debt Sustainability Analysis published last week called for […]<\/p>\n","protected":false},"author":84,"featured_media":31533,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2,5],"tags":[234,235,233],"class_list":["post-31534","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-all-news","category-economy","tag-africa-press","tag-africa-press-zambia","tag-zambia"],"yoast_head":"\nZambia\u2019s bond holders slam IMF debt relief target as \u2018arbitrary\u2019 - Zambia<\/title>\n<meta name=\"description\" content=\"Reuters reports that Zambia\u2019s international bondholders have criticised the International Monetary Fund\u2019s debt restructu ...\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.africa-press.net\/zambia\/all-news\/zambias-bond-holders-slam-imf-debt-relief-target-as-arbitrary\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Zambia\u2019s bond holders slam IMF debt relief target as \u2018arbitrary\u2019\" \/>\n<meta property=\"og:description\" content=\"Reuters reports that Zambia\u2019s international bondholders have criticised the International Monetary Fund\u2019s debt restructu ...\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.africa-press.net\/zambia\/all-news\/zambias-bond-holders-slam-imf-debt-relief-target-as-arbitrary\" \/>\n<meta property=\"og:site_name\" content=\"Zambia\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/AfricaPressTunisiaa\" \/>\n<meta property=\"article:published_time\" content=\"2022-09-18T20:04:51+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2022-09-18T20:25:49+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/static.africa-press.net\/zambia\/sites\/35\/2022\/09\/postQueueImg_13-63277eb211516.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"800\" \/>\n\t<meta property=\"og:image:height\" content=\"360\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"cfeditoren\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"cfeditoren\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.africa-press.net\/zambia\/all-news\/zambias-bond-holders-slam-imf-debt-relief-target-as-arbitrary#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.africa-press.net\/zambia\/all-news\/zambias-bond-holders-slam-imf-debt-relief-target-as-arbitrary\"},\"author\":{\"name\":\"cfeditoren\",\"@id\":\"https:\/\/www.africa-press.net\/zambia\/#\/schema\/person\/068c7ab4e9634ae78ec5d54ec46598bb\"},\"headline\":\"Zambia\u2019s bond holders slam IMF debt relief target as \u2018arbitrary\u2019\",\"datePublished\":\"2022-09-18T20:04:51+00:00\",\"dateModified\":\"2022-09-18T20:25:49+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.africa-press.net\/zambia\/all-news\/zambias-bond-holders-slam-imf-debt-relief-target-as-arbitrary\"},\"wordCount\":445,\"commentCount\":0,\"image\":{\"@id\":\"https:\/\/www.africa-press.net\/zambia\/all-news\/zambias-bond-holders-slam-imf-debt-relief-target-as-arbitrary#primaryimage\"},\"thumbnailUrl\":\"https:\/\/static.africa-press.net\/zambia\/sites\/35\/2022\/09\/postQueueImg_13-63277eb211516.jpg\",\"keywords\":[\"Africa Press\",\"Africa Press-Zambia\",\"Zambia\"],\"articleSection\":[\"all news\",\"economy\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.africa-press.net\/zambia\/all-news\/zambias-bond-holders-slam-imf-debt-relief-target-as-arbitrary#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.africa-press.net\/zambia\/all-news\/zambias-bond-holders-slam-imf-debt-relief-target-as-arbitrary\",\"url\":\"https:\/\/www.africa-press.net\/zambia\/all-news\/zambias-bond-holders-slam-imf-debt-relief-target-as-arbitrary\",\"name\":\"Zambia\u2019s bond holders slam IMF debt relief target as \u2018arbitrary\u2019 - 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