Day: September 23, 2020

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Zambia Becomes the First African Country to Default on Its Debt Since the Outbreak of COVID-19

The day that many African policymakers had long feared since the outbreak of COVID-19 earlier this year is now here. Zambia yesterday said it will be unable at this time to repay the interest on three Eurobonds, totally around $3 billion, and will effectively have to default ...

Reaction to Zambia’s Eurobond Debt Default

News of Zambia's request to postpone payments on three Eurobond notes prompted immediate reactions from stakeholders in the financial services sector, economic policymakers and journalists.  Here's a sampling of the reactions on Twitter: "Sad. It’s important to remember that (a) Zambia’s ...

Contrary to Popular Perception, Zambia’s Debt Problem is With Global Capital Markets Not China

Although China is by far Zambia's largest bilateral creditor, the total amount owed to Beijing is less than what Lusaka has to pay to Eurobond holders and various other private creditors. The outlook for 2022 is especially dire because sizable Eurobond repayments are due. ...

This is What Happens When an African Country Says It Can’t Repay Bondholders on Time

From the beginning of the COVID-19 economic crisis in Africa, African ministers have said repeatedly that they want to do everything possible to avoid a default on their commercial debt. Yesterday's announcement by the Zambian government that it will delay repayments ...

As Eurobond Investors Boo Zambia, They’re Now Cheering For Angola

While Zambia is getting pummeled by investors for signaling that it'll have to delay some Eurobond repayments, Angola is enjoying the opposite following bold reassurances from Osvaldo Joao, the state secretary for finance. "“We will always pay,” he told Bloomberg on Monday. ...

Analysis from Cobus van Staden

China-Led Study Proposes Global Energy Network

A globally connected network of solar and wind energy could provide three times the global energy demand by 2050 at a lower cost than independent national power systems. This is the finding of a study led by the Chinese Academy of Sciences in collaboration with researchers from the United States and Denmark.

The study focused on how areas with high solar and wind capacity (such as deserts) can be linked to ...

Ethiopia’s Ambassador to the U.S. Renews Urgent Plea for African Debt Relief

Ethiopia's envoy to the United States, Fitsum Arega, used the occasion of the United Nations 75th anniversary to renew a plea for urgent African debt relief that was first issued by Prime Minister Abiy Ahmed on March 24th.

Uganda’s National Debt Surged 21% to Offset the Downturn Brought on by COVID-19

The Ugandan government has significantly increased its borrowing in a bid to help mitigate the financial impact of the ongoing economic crisis brought on by the COVID-19 pandemic. The Central Bank on Tuesday said that in the period from June 2019 to June 2020, borrowing increase by ...

China and the Burgeoning African Debt Crisis

Over the last week we've reached two critical milestones that put the worsening African debt crisis into sharp focus: First, the good news. Angola appears to have reached an agreement with some of its major creditors at the International Monetary Fund ...