Brazil writes off $90m of Zambia’s debt

Zambia has signed a $ 90.7 million debt write off with the Brazilian government, relieving the country of about 80 per cent of the US$113.4 million debt it was owing the South American economic giant.

In a statement issued today by Finance Ministry spokesperson Chileshe Kandeta, the debt write-off was signed between Brazilian Secretary for International Affairs Dr Marcello Estevao and Zambia’s Minister of Finance Felix Mutati in Brasilia.

And Kandeta stated that the remaining US$22.7 million rescheduled for repayment in two equal instalments to be paid by March, 2018

Speaking after the signing ceremony held at the Brazilian Ministry of Finance Headquarters, Mutati said the savings from what would have been full debt repayment will be channeled to support the implementation of poverty reduction programmes outlined in the Seventh National Development Plan [7NDP].

“We are very grateful to Brazil for concluding a process that started way back in 2005. This agreement will reinforce the relationship between Brazil and Zambia,” said Mutati.

“I take this opportunity to reiterate our commitment to execution of the Economic Stabilisation and growth programme through which the Zambian Government, under the stewardship of President Edgar Chagwa Lungu, has implemented measures to stimulate enhanced economic growth; sustain the fiscal consolidation process; and, promote financial discipline across all domains of the public service.”

AND Dr Estevao said the parties’ debt write-off and debt rescheduling agreement is a great start to a new phase of development cooperation between Brazil and Zambia.

Dr. Estevao stated that after suffering stagnation, his country was now undertaking structural reforms which have redirected the Brazilian economy to a recovery path with growth projected at 3 per cent, adding that, “this is a good time to sign the agreement and heighten the relationship between the two countries.”

Brazil is at the frontier of technological advancement in the agriculture chain, therefore, “it makes a lot of sence to collaborate in order to boost Zambia’s diversification process,” said Dr. Estevao.

Meanwhile the Brazilian Secretary for International Affairs said his country backs Zambia in her quest to get on an IMF Programme because of the importance that investors, and both bilateral and multilateral cooperating partners attach to endorsements by the IMF through a programme.

Dr. Estevao, a former IMF official who until 2016 served as an economist, researcher, and IMF Mission Chief for various countries for a period spanning over twenty [20] years, told Mutati and his delegation that “Brazil will support Zambia when the presentation is made at the IMF.”

         

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