Zambian creditors pledge debt relief needed for IMF funding – sources

July 20 (Reuters) – Zambia’s creditors are expected to pledge the debt relief needed to release $1.4 billion from the IMF on Wednesday or Thursday, two sources familiar with the situation said, as the country and its lenders are seeking to end a never-ending restructuring. treat.

After meeting on Monday, Zambia’s bilateral creditors agreed to issue a statement on their position sufficient for the International Monetary Fund (IMF) board to approve a three-year, $1.4 billion program, indicated the sources.

Creditors must issue a positive statement, a third source said, without providing further details.

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In 2020, Zambia became the first African country to default on its debts in the era of the pandemic, struggling with external debts that reached $17.27 billion at the end of last year, according to government data.

“The president looks forward to seeing Zambia’s debt problem quickly resolved and is pleased that progress is being made,” presidential spokesman Anthony Bwalya told Reuters on Wednesday, without giving details.

“I hope Zambia can get debt relief in the next few days,” World Bank President David Malpass told Bloomberg TV on Tuesday. “There was just a meeting of creditors yesterday, which gives a sign of hope.”

Zambia reached a staff-level agreement with the IMF on the extended $1.4 billion credit facility in December, but will not get the money until it agrees with its creditors to reduce debt to sustainable levels.

The first meeting of creditors was held in June, after the Zambian government complained about delays in the restructuring, which is taking place under the Common Framework, a debt relief process launched in 2020 by the Group of the 20 major economies which has not yet produced results.

Chad’s Common Framework creditors’ committee met last week and Ethiopia’s on Tuesday, with the IMF calling on lenders to reach deals quickly. Read more

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Reporting by Andrea Shalal in Seoul; Additional reporting by Chris Mfula in Lusaka; Written by Rachel Savage in London; Editing by Leslie Adler

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