Zambia Bonds Gain After President Tweets He’ll Pay Creditors
(Bloomberg) -- Zambian President Hakainde Hichilema took to Twitter on Thursday to assure creditors that they’ll be paid, having warned in an interview with Bloomberg this week that the southern African nation’s debt burden is bigger than previously thought. The country’s bonds rallied.
Hichilema, who defeated Edgar Lungu in last month’s election, needs to negotiate new terms with external lenders after Zambia became Africa’s first pandemic-era defaulter 10 months ago. Using the nickname “Bally” -- local slang for dad -- the new president said he would pay.
First, Zambia needs to secure a deal with the International Monetary Fund that will form the basis of talks with creditors that range from state-owned Chinese lenders to holders of the nation’s $3 billion Eurobonds. Situmbeko Musokotwane, the new finance minister, says he’s targeting a deal with the Washington-based lender by November.
Zambia’s $1 billion in dollar bonds due 2024 advanced 1.1% to 79.8 cents on the dollar by 2:35 p.m. in London. They’d retreated by the most in more than two months on Wednesday, after Hichilema’s warning on the level of debt.
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