UPDATE 1-Zambia’s borrowing requirement includes money for Eurobond repayment, Minister says

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LUSAKA, Oct.31 (Reuters) – Zambia’s $ 2.4 billion borrowing requirement for its 2022 fiscal year includes $ 750 million that will be used to repay its Eurobond, Finance Minister Situmbeko said on Sunday. Musokotwane in an interview on public television.

“This amount we’re talking about, $ 750 million, is actually the money we’re going to borrow to pay off the first Eurobond we got that is due next year. So we’re refinancing. “said Musokotwane.

Zambia defaulted on its sovereign debt a year ago, becoming the first African country to do so during the coronavirus crisis.

The government on Friday pledged to reduce its budget deficit and cut borrowing, as it aims to agree on an International Monetary Fund (IMF) lending program by the end of next month and a restructuring of debt early next year.

Musokotwane said on Friday that to reduce debt build-up, the government would not take out any non-concessional external loans except for refinancing purposes.

On Sunday, he reiterated the need for the country to obtain loans on more favorable terms.

“Don’t expect borrowing to just stop. Of course, there are projects that were started earlier that can’t stop … Then there is also the possibility of borrow a bit more on concessional borrowing, ”he said. (Reporting by Chris Mfula; writing by Olivia Kumwenda-Mtambo; editing by Giles Elgood)

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