Zambia has launched a buyback of its US$1.36 billion eurobond due in 2053, using financing from the African Development Bank and its own resources, in a move aimed at improving the country’s debt profile and strengthening its path back to international capital markets.
The Zambian finance ministry announced on Friday that it intends to repurchase the bond, which was created in 2024 as part of the country’s debt restructuring programme. The bond carries fixed-rate step-up interest payments.
According to the ministry, the transaction will be financed partly through a new US$600 million loan from the African Development Bank and through government resources.
“The transactions will allow the Republic to streamline its debt stock and proactively manage its overall debt maturity profile,” the government said in a regulatory notice. It added that the operation would also help prepare the country for a future return to international financial markets.
The announcement was welcomed by investors, with the price of the bond rising sharply following the news. Tradeweb data showed the bond gained more than 4.5 cents to trade at 77.91 cents on the dollar.
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Zambia became the first African country to default on its external debt during the COVID-19 pandemic in 2020. Since then, the southern African nation has been engaged in a lengthy debt restructuring process under the G20 Common Framework, seeking to restore debt sustainability and rebuild investor confidence.
The country has completed most of its debt restructuring efforts, including agreements with bilateral and private creditors. Authorities have repeatedly indicated that improving debt management and reducing refinancing risks are key priorities as the economy recovers.
Analysts say the proposed buyback could help Zambia reduce future debt-servicing pressures by retiring part of its long-dated obligations while signalling confidence in the country’s fiscal outlook.
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The operation also underscores the continued role of multilateral lenders such as the AfDB in supporting African economies navigating post-restructuring recovery and efforts to regain access to global capital markets.
