GOVERNMENT has no plans to sell its external debt to foreign investment agents popularly known as the “Vulture Funds” contrary to media reports alleging that the Government had received unsolicited offers from foreign investment agents to buy off the country’s external debt.
This follows reports by some media houses that Government had received offers from some foreign investment agents to consider selling off its external debt.
Secretary to the Treasury Fredson Yamba has categorically denied that there were plans by Government for the sale of any debt to any investor and that the government remained fully committed to the conditions and principles under which the debts were contracted.
Mr Yamba said in a statement yesterday that Government was going to remain in the international debt market and was ready to honour all its obligations as they would fall due.
Mr Yamba said the establishment and operationalization of the Sinking Fund was testimony to Government’s commitment to remain in the international debt market and to honour all its debt obligations.
He said Government was developing a Medium-Term Debt Strategy to ensure that there was a coherent and well-structured way of dealing with debt and its associated risks.
Mr Yamba said assertions that Government was planning to sellits external debt after the realization that the Zambian Government was in error to borrow from the commercial capital market were unfounded and misleading.
He said borrowing in Zambia was strictly guided by the Loans and Guarantees Authorisation Act 366 of the Laws of Zambia which had set procedures of borrowing.
“In the last few days there have been reports in some sections of the media that the Zambian Government has received unsolicited offers from foreign investment agents popularly known as “Vulture Funds” to buy off the country’s external debt. The media reports have made specific reference to the already contracted debt particularly the Eurobonds.
“Government would like to categorically state that it has no plans for any sale of its debt to any investor. The Government is fully committed to the conditions and principles under which the debts were contracted. This means that Government will remain in the international debt market and honour all its obligations as they fall due,” Mr Yamba said.
He said the application of the debts had largely been on investment, growth and poverty reduction supporting projects such as those in the energy, transport, communications, social and infrastructure as well as health and education.
Mr Yamba said it was the belief of Government that the huge investment would increase economic activity which would in turn give the country the capacity to repay the debts.