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LUSAKA, July 30 (Reuters) - Zambia wants to refinance portions of Africa’s No. 2 copper producer’s Chinese debt and its Eurobonds as part of a debt austerity plan, its finance minister said on Monday.
Finance Minister Margaret Mwanakatwe said a high level mission from Zambia would travel to China in August to firm up discussions in order to create smooth cash flows.
Mwanakatwe also said refinancing its Eurobonds was not in any way a failure to repay them.
Zambia wanted to refinance portions of the Chinese debt with a medium-term maturity profile, she said.
“This will ultimately create positive and smooth cash flows,” Mwanakatwe said.
President Edgar Lungu said on Saturday a Turkish company had expressed interest in refinancing Zambia’s $750 million Eurobond falling due in 2022.
Mwanakatwe said the refinancing of the Eurobonds to achieve lower costs and longer maturities with potential investors, will be done in full consultation with the bond holders.
Zambia, whose credit rating was downgraded by Moody’s on Friday, said in December last year that it would begin refinancing Eurobonds worth a total $3 billion in 2019 to reduce the cost of debt servicing for Africa’s No.2 copper producer.
In June, Zambia decided to delay all planned borrowing indefinitely, slowing down the accumulation of new debt amid worries about the risk of distress. (Reporting by Chris Mfula Editing by James Macharia)