In a statement yesterday, Zambia’s finance ministry said that the International Monetary Fund/World Bank debt sustainability framework for low-income countries calls for a 5 percent discount rate.
However, the ministry noted that it would consider an alternative discount rate in debt revamp talks. According to the ministry, “the authorities would neither dispute nor refuse the use of an alternative discount rate by creditors and are ready to base discussions on any such preferred rate, as long as the final agreed parameters comply with debt sustainability analysis constraints.”
The ministry also said it was willing to “discuss and explore all restructuring options” that would be acceptable for creditors. However, it emphasised that the quantum of debt relief set out in the framework for Zambia needs to be delivered for the country to stay on track with its adjustment programme.