Zambia executes $1.36 billion debt buyback and joins J.P. Morgan bond index

Zambia has executed a significant debt buyback, repurchasing approximately $1.36 billion in Fixed Rate Step-Up Amortizing Notes due in 2053. This transaction, completed nearly three decades ahead of maturity, was financed through $600 million from the African Development Bank alongside the government’s own resources.

Finance and National Planning Minister Situmbeko Musokotwane described the move as a shift toward proactive debt management rather than mere restructuring. By retiring long-dated debt early, the government aims to reduce interest expenses and remove future liabilities from its books.

In a related development for the country’s financial standing, Zambia has qualified for J.P. Morgan’s new local-currency government bond index, the GBI-EM Edge. This inclusion provides Zambia with access to a broader global investor audience, potentially facilitating easier trading and cheaper borrowing. The qualification follows the Bank of Zambia’s strategy to increase the size of benchmark bond issues to meet index requirements.