Zambia to Seek Help in Eurobond Refinancing, President Says

(Bloomberg) -- Zambia, which Moody’s Investors Service cut further into junk this weekend, wants help to refinance its first Eurobond that matures in 2022, President Edgar Lungu said during a meeting with his Turkish counterpart Recep Tayyip Erdogan.

“$750 million is almost due for repayment, and I think we would seek assistance in that respect,” he said in comments broadcast over state-owned TV on Saturday. "We have information that a Turkish company has expressed willingness to refinance the Eurobond and that the company will visit Zambia sometime in September to finalize the details of the refinancing agreement.”

The southern African nation’s foreign loans have nearly doubled since 2014 to more than $9 billion, according to data from the Finance Ministry, and the International Monetary Fund says the country is at high risk of external debt distress.

Total government borrowing will probably rise toward 70 percent of GDP at the turn of the decade from about 60 percent currently, according to Moody’s, which cut Zambia’s credit rating by one notch to Caa1.

Lungu didn’t provide further details and a Finance Ministry spokesman didn’t immediately respond to a text message outside of business hours.

Zambia, Africa’s second-biggest copper producer, plans to hold talks with lenders in China to restructure some of its loans, Lungu said July 11.

©2018 Bloomberg L.P.

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