The troubled nation receives an extension on debt repayment.
Secretary of the Treasury Janet Yellen commended Zambia’s debt restructuring agreement this week.
Many African countries are deeply in debt to allow their governments to run smoothly. The economies of those countries are fragile and their political situations are conflicted, which led to more volatile financial situations during the COVID-19 pandemic.
In 2020, Zambia became the first African country to default on its $6.3 billion debt, $4 billion of which was owed to China. Zambia immediately moved to renegotiate the terms of the debts they owed, which was a lengthy process in which many other countries participated. This week, Zambia was granted 20 additional years to repay its debts, including a three-year grace period for interest-only payments.
“During my trip to Zambia earlier this year, I saw firsthand how the weight of default and a stalled debt restructuring process can bring suffering to ordinary families and hold back economic growth,” said Secretary Yellen. “I am pleased that the international community has come together to support Zambia in its time of need.”
As the Lord Leads, Pray with Us…
- For Secretary Yellen as she interacts with foreign financial ministers and heads of state.
- For U.S. Treasury officials as they seek to maintain the solvency of the federal government.
Sources: Department of Treasury, BBC
