First, Zambia Defaulted on Part of Its Debt, Then Came the Credit Downgrade, Now the Question is What Will China Do?

Zambia's President Edgar Lungu shakes hands with China's President Xi Jinping before their bilateral meeting at the Great Hall of the People on September 1, 2018. Nicolas ASFOURI / POOL / AFP

Zambia’s financial situation is rapidly deteriorating following last week’s announcement by the government that it would default on $3 billion of Eurobond debt. Soon after, the credit ratings agency Fitch downgraded Zambia’s foreign-currency bonds, immediately increasing the cost of borrowing for Lusaka.

Investors weren’t encouraged by Friday’s unveiling of the 2021 annual budget by Finance Minister Bwalya Ng’andu where he forecast yet another increase in the country’s budget deficit but didn’t elaborate debt restructuring plans.

  • Get a daily email packed with the latest China-Africa news and analysis.
  • Read exclusive insights on the key trends shaping China-Africa relations.
  • Full access to the News Feed that provides daily updates on Chinese engagement in Africa and throughout the Global South.

China, Africa and the Global South... find out what’s happening.

Subscribe today for unlimited access.

What is The China-Global South Project?

Independent

The China-Global South Project is passionately independent, non-partisan and does not advocate for any country, company or culture.

News

A carefully curated selection of the day’s most important China-Global South stories. Updated 24 hours a day by human editors. No bots, no algorithms.

Analysis

Diverse, often unconventional insights from scholars, analysts, journalists and a variety of stakeholders in the China-Global South discourse.

Networking

A unique professional network of China-Africa scholars, analysts, journalists and other practioners from around the world.