[{"data":1,"prerenderedAt":-1},["ShallowReactive",2],{"doc-detail-111339-en":3,"doc-seo-111339-105":29,"detail-sidebar-cat-0-en-105":91},{"code":4,"msg":5,"data":6},0,"success",{"doc_id":7,"user_id":8,"nickname":9,"user_avatar":10,"doc_module":4,"category_id":11,"category_name":12,"doc_title":13,"doc_description":14,"doc_content":15,"file_id":16,"file_url":17,"file_type":18,"file_size":19,"view_count":20,"is_deleted":4,"is_public":20,"is_downloadable":20,"audit_status":20,"page_count":21,"language":22,"language_code":23,"site_id":24,"html_lang":23,"table_of_contents":25,"faqs":26,"seo_title":13,"seo_description":14,"update_tm":27,"read_time":28},111339,4398048949847,"Eliana","https://ap-avatar.wpscdn.com/avatar/400002536579ef2da7f?_k=1778318612642679267",8,"Research & Report","Zambia: Joint Bank-Fund Debt Sustainability Analysis - Debt Distress Risk Assessment","Zambia’s public debt is assessed as sustainable, yet both overall and external debt distress risks remain high, with current results differing from earlier assessments that had characterized debt as in distress with unsustainable trajectories. The analysis applies a post-restructuring macro-framework, reflecting treatment of official bilateral claims, the completed Eurobond exchange, and agreements in principle with external commercial creditors. Baseline projections show improvements in key thresholds by 2025–2027, while export shocks and combined macroeconomic shocks pose downside risks.","Public Disclosure Authorized  \nApproved by:  \nManuela Francisco and Hassan Zaman (IDA) , and Costas Christou and Jarkko Turunen (IMF)  \nPrepared by the staff of the International Development Association (IDA) and the International Monetary Fund (IMF) .  \nPub lic Disc losure Authorized  \n\n| ZAMBIA: JOINT BANK-FUND DEBT SUSTAINABILITY ANALYSIS |  |\n| --- | --- |\n| Risk of external debt distress | High |\n| Overall risk of debt distress | High |\n| Granularity in the risk rating | Sustainable |\n| Application of judgment | No |\n\nZambia’s public debt is assessed as sustainable but remains at high risk of overall and external debt distress, compared to the June 2024 assessment indicating Zambia’s external and overall public debt as in debt distress, with unsustainable public debt. The analysis is based on a full post-restructuring macro-framework, incorporating the treatment of official bilateral claims agreed with Zambia’s Official Creditor Committee (OCC), the completed Eurobond exchange, the agreements in principle (AIP) reached with some of the external commercial creditors, and under the assumption of treatment of the residual claims of other external commercial creditors in line with the authorities’ restructuring strategy and consistent with program parameters and comparability of treatment principles. Under the baseline, there are remaining breaches of the overall and some external debt indicator thresholds.1 Zambia’s debt indicators are projected to improve, consistent with a moderate risk of external debt distress in the medium term. The present value of external debt-to-exports ratio is expected to decline below the 84 percent threshold indicating \"substantial space to absorb shocks\" by 2027 and the debt service-to-revenue ratio is projected to fall below the 14 percent threshold by 2025 and remain below this level on average over 2026–31. The DSA suggests that shocks to export and combined shocks of the economy would present downside risks to the debt outlook.  \n1 Zambia’s debt-carrying capacity is weak based on the composite indicator (CI) . The composite indicator is calculated using data from the October 2024 WEO and the 2023 CPIA, the latest available.  \n1. As in the previous DSA, the coverage of Zambia’s public and publicly guaranteed (PPG) debt for the purpose of the DSA includes the following : i) central government domestic and external debt, including arrears to external suppliers (fuel and contractors) and central government guaranteed external debt; ii) the nonguaranteed external debt of Zambia Electricity Supply Company (ZESCO), the fiscally important state-owned utility;1F2 and iii) the domestic and external arrears of the same enterprise. Central bank external debt (including outstanding Fund credit), together with the debt of social security funds guaranteed by the central government,2 are also included in the coverage. F3  \n2. The DSA also incorporates the non-guaranteed external debt of the Zambia Electricity Supply Company (ZESCO), including its domestic and external arrears. In accordance with the LICDSF Guidance Note, given the significant fiscal risks posed by ZESCO, a fiscally important state-owned utility, its non-guaranteed external debt3F and outstanding payables to domestic (US$1 .2 billion at end- 2023) and external (US$100 million at end-2023) independent power producers (IPPs), are included in the DSA perimeter.4 The authorities are taking steps to restore ZESCO’s financial viability over the medium term. As progress is made, the inclusion of its non-guaranteed debt in the DSA debt perimeter will be reassessed.  \n3. Local governments and SOEs without government guarantees are excluded from the DSA coverage. Local governments in Zambia currently cannot borrow externally without the central government’s guarantee. The authorities confirmed that no extrabudgetary funds with outstanding external debt currently exist.  \n4. Two financial public corporations have taken on new non-guaranteed external b","cbCaiq4Ipurrej05","https://ap.wps.com/l/cbCaiq4Ipurrej05","pdf",871520,1,26,"English","en",105,"# Risk Assessment Summary\n## Risk of external debt distress\n## Overall risk of debt distress\n# Methodology and Assumptions\n## Post-restructuring macro-framework\n## Creditor treatment and program parameters\n# Debt Indicators and Thresholds\n## Export and revenue ratios\n## Downside risks from shocks\n# Coverage of Debt Perimeter\n## Public and publicly guaranteed debt\n## Inclusion of ZESCO and arrears\n## Exclusions and residency basis","[{\"question\":\"How is Zambia’s overall debt sustainability risk rated in this analysis?\",\"answer\":\"Overall risk of debt distress is rated High, even though public debt is assessed as sustainable.\"},{\"question\":\"Which creditor and restructuring elements are reflected in the post-restructuring framework?\",\"answer\":\"The framework incorporates treatment of official bilateral claims, the completed Eurobond exchange, and agreements in principle with some external commercial creditors, while applying assumptions consistent with authorities’ restructuring strategy.\"},{\"question\":\"What key indicators are expected to improve, and by when?\",\"answer\":\"The present value of external debt-to-exports is projected to fall below the 84% threshold by 2027, and the debt service-to-revenue ratio is projected to fall below the 14% threshold by 2025 and remain below it on average over 2026–31.\"}]",1784489679,66,{"code":4,"msg":30,"data":31},"ok",{"site_id":24,"language":23,"slug":32,"title":13,"keywords":33,"description":14,"schema_data":34,"social_meta":86,"head_meta":88,"extra_data":90,"updated_unix":27},"zambia-joint-bank-fund-debt-sustainability-analysis-debt-distress-risk-assessment","",{"@graph":35,"@context":85},[36,53,68],{"@type":37,"itemListElement":38},"BreadcrumbList",[39,43,47,50],{"item":40,"name":41,"@type":42,"position":20},"https://docshare.wps.com","Home","ListItem",{"item":44,"name":45,"@type":42,"position":46},"https://docshare.wps.com/document/","Document",2,{"item":48,"name":12,"@type":42,"position":49},"https://docshare.wps.com/document/research-report/",3,{"item":51,"name":13,"@type":42,"position":52},"https://docshare.wps.com/document/zambia-joint-bank-fund-debt-sustainability-analysis-debt-distress-risk-assessment/111339/",4,{"url":51,"name":13,"@type":54,"author":55,"headline":13,"publisher":57,"fileFormat":60,"inLanguage":23,"description":14,"dateModified":61,"datePublished":62,"encodingFormat":60,"isAccessibleForFree":63,"interactionStatistic":64},"DigitalDocument",{"name":9,"@type":56},"Person",{"url":40,"name":58,"@type":59},"DocShare","Organization","application/pdf","2026-07-20","2026-07-19",true,{"@type":65,"interactionType":66,"userInteractionCount":20},"InteractionCounter",{"@type":67},"ViewAction",{"@type":69,"mainEntity":70},"FAQPage",[71,77,81],{"name":72,"@type":73,"acceptedAnswer":74},"How is Zambia’s overall debt sustainability risk rated in this analysis?","Question",{"text":75,"@type":76},"Overall risk of debt distress is rated High, even though public debt is assessed as sustainable.","Answer",{"name":78,"@type":73,"acceptedAnswer":79},"Which creditor and restructuring elements are reflected in the post-restructuring framework?",{"text":80,"@type":76},"The framework incorporates treatment of official bilateral claims, the completed Eurobond exchange, and agreements in principle with some external commercial creditors, while applying assumptions consistent with authorities’ restructuring strategy.",{"name":82,"@type":73,"acceptedAnswer":83},"What key indicators are expected to improve, and by when?",{"text":84,"@type":76},"The present value of external debt-to-exports is projected to fall below the 84% threshold by 2027, and the debt service-to-revenue ratio is projected to fall below the 14% threshold by 2025 and remain below it on average over 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