Africa’s copper producer Zambia has named London based communications advisory firm Highgate Ltd to manage its debt restructure correspondence for 6months. According to a press release by Ministry of Finance signed by Secretary to the Treasury Fredson Yamba, the copper producer, Highgate Advisors have been named for 6months for a GBP333,403.54.
Earlier in June 2020 Zambia had named French Investment banking firm Lazard Freres and later on White & Case LLP legal advisors following commencement of a debt restructure process, a condition that Washington based lender has posed to the Southern African nation to commence any meaningful bailout discussions. Zambia has been a victim of information asymmetry especially at a time as this where the copper producer grapples with external debt of $12.97billion for which its stands in the labyrinth of restructure deliberations with China and dollar bond holders. The MinFin acknowledges the important of having experts to manage the communication aspect that narrows potential assymetries as restructure progresses.
The complete appointment of legal, debt restructure and communication advisors will help the red metal producer restore confidence and transparency in the debt restructure process and it takes steps to restore fiscal fitness.
Zambia was the first African nation to default on its dollar debt in COVID era in 2020 when it skipped a $42.5million coupon payment on its 2024 Eurobond on October 13. The copper hotspot has circa $120million in coupon payments falling due between January and April 2021 for which it is still in talks with dollar bond holders for reprieve in payment. Two Chinese banks namely China Exim bank and China Development bank extended relief to Zambia to April 2021 while the Paris Club nodded by the G20 also extended reprieve to Zambia to midyear 2021.
The Kwacha Arbitrageur