Zambia secures over 90% of bondholders consent, paves way for final closures on debt restructuring

Government has announced that over 90 percent of Zambia’s US$3 billion bondholders have accepted its restructuring proposal so far which was made on May 13, 2024.

This was done through the launch of a consent solicitation for its US$750, 000, US$1 million and US$1.2 million bonds.

The latest votes by bondholders reportedly paved way for the country to emerge from a lengthy default.

A statement issued by the Ministry of Finance and National Planning claimed that bondholders overwhelmingly voted in favour of the proposed restructuring deal as of the early consent deadline.

Voting on the proposal only finishes officially on May 30.

Read more: Chamber of commerce hopes Zambia’s deal with Eurobond holders will unlock resources for development

“Zambia is pleased to inform that there was overwhelming participation and the outturn of the voting instructions was above the required minimum threshold,” the statement indicated.

Under the proposed plan, bondholders would swap three existing instruments due to mature in 2022, 2024 and 2027, into two amortising bonds, one of which would have higher repayments if the country’s economic outlook improved.

In response to the development, Finance and National Planning Minister, Situmbeko Musokotwane, said finalising this agreement with bondholders would create the fiscal breathing space necessary for Zambia to remain on a trajectory of sustainable economic growth.

“We are extremely pleased to see such high participation in our bondholder consent. After nearly four years since we initially defaulted on our Eurobonds, the close of the restructuring chapter is in sight.

“Our thanks go out to our bondholders for their support, and we look forward to finalizing all formalities with respect to the consent process in the coming weeks,” Musokotwane said.

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