Libyan investment portfolio LAP GreenN has vented anger at Finance Minister Felix Mutati for claiming that the Zambian government was in the process of settling its US$395 million debt owed to the company when in fact “no single cent” has been paid.

This is contained in a letter of claim signed by LAP GreenN chairman Dr Faisel Geigab.

Dr Geigab disclosed that the Zambian government through the Minister of Finance had been sending bank transfer documents, but no actual cash was remitted to LAP GreenN.

“The now Minister of Finance was a member of Cabinet of the Zambian government at the time LAP GreenN acquired its shareholding in Zamtel. He is very familiar with the LAP GreenN matter. It would have been more useful of him to give a more comprehensive statement in parliament last month. We say this because the recent conduct of the Minister of Finance with respect to addressing the GRZ obligations to LAP GreenN has raised considerable concerns regarding the good faith and integrity of the minister,” Dr Geigab stated.

“For example, we have been sent bank transfer documents signed on behalf of the minister instructing its bankers to transfer funds to us, however, no actual payment has been received. The Attorney General, Mr Likando Kalaluka, State Counsel, has similarly made commitments on behalf of the GRZ that payments would be made to settle the GRZ’s indebtedness in LAP GreenN, however, not a single cent has been received as yet. We have material evidence to this effect.”

He stated that government’s conduct was unacceptable and it was denting Zambia’s reputation on debt repayment.

“The conduct of the GRZ towards our matter is totally unacceptable and constitutes a breach of the Zambian Constitution and the international law. It raises questions regarding the credentials of the GRZ, including its commitments to Zambia’s constitutional democracy and democratic governance. LAP GreenN is taking active steps to pursue full compensation recovery from the GRZ locally in Zambia, within Sub Saharan Africa and internationally. As the Zambian government is part of the international finance and investment community, it is indifferent to its serial defaults of such substantive sovereign debt obligations will not help its reputation. For example, the serial default payments could have an adverse effect on its international standing, including with international funding institutions, credit rating agencies and G20 states (several of which are already aware of this matter),” Dr Geigab wrote.

He warned that there would be costly repercussions on the Zambian economy for the ‘serial defaults’.

“We believe the GRZ sovereign defaults will have costly repercussions for the entire Zambian economy. Since the nationalization of its shares, LAP GreenN has demonstrated courtesy and commitment to resolve this matter amicably. However, this approach has been abused by the GRZ. Nonetheless, we are resolved to recover amounts due to us by the Zambian government and we will pursue all avenues or recourse available to us should the defaults continue,” wrote Dr Geigab.

“If requested, LAP GreenN will submit a written statement to Parliament, with supporting documentation, to demonstrate the blatant disregard shown by the Ministry of Finance and Attorney General to the serial breaches by the GRZ of its sovereign and Constitutional legal obligations.”