China’s top diplomat holds debt talks with Zambia after appeal for restructure under G20 common framework

Zambia’s request is a test case of how China approaches the common framework, say analysts

Yang Jiechi underscores the long relationship between the two nations and promised Beijing would continue to support Lusaka

Reading Time:4 minutes

Zambian President Edgar Lungu meets China’s most senior foreign policy official, Yang Jiechi, in Lusaka, Zambia, on February 22, 2021. Photo: Xinhua

Published: 5:30am, 24 Feb 2021Updated: 10:33am, 24 Feb 2021

Top Chinese diplomat Yang Jiechi’s Zambia visit could not have come at a better time.

Africa’s second-biggest copper producer has asked to restructure its debts under a new “common framework” supported by the Group of 20 major economies in which Beijing – Zambia’s largest bilateral lender – holds the key to easing the country’s debt troubles.

With the common framework, China and other G20 countries are expected to coordinate their discussions to restructure Zambia’s debts. China will be the lead bilateral creditor for essentially all the countries involved, and so will be the key actor negotiating the memorandum of understanding with countries in the G20 framework.

Further, Lusaka is in discussions with the International Monetary Fund for a possible bailout after headed for another default on some debts.

Mark Bohlund, a senior credit research analyst at REDD Intelligence, said Yang’s visit to Lusaka needed to be put in the context of the ongoing IMF mission and upcoming negotiations for restructuring Zambia’s debt.