Q FM Africa's Modern Radio
EAZ President Lubinda Habaazoka
The Economics Association of Zambia (EAZ) says it supports government’s decision to use a Turkish private equity to amortize the US$750 million Eurobond which falls due in 2022.
EAZ president Lubinda Habaazoka says government’s decision is a far much better in the absence of a sinking fund as it will help Zambia avoid defaulting on the Eurobond when it matures.
Dr. Habaazoka, who is also Director of the University Of Zambia School of Business, explains that what government is trying to do is to basically convert capital market fund into conventional debt.
In an interview with QTV News, Dr. Habaazoka, says this conversion will enable Zambia to restructure the Eurobond for a longer maturity date which in turn may reduce the payment.
He has advised the government that as it negotiates the refinancing, it should also entice the Turkish government to move in as an equity partner in the debt so that the loan can have a public touch.
Dr. Habaazoka says given the period in which this has been done, Zambia is sending a signal to the market that it is aware of the debt that is falling due and is putting measures in place to pay coupon rate at maturity.
The EAZ president is certain that the market has received the Zambian government’s move positively.
He further allayed fears of the risk of Zambia falling into the hands of a venture fund as long as it is meeting its debt payment.