Zambia’s Imminent Debt Default

Zambia is expected to default on its external debt when the southern African country misses $118 million in interest payments on eurobonds due from Oct. 14 to March 2021. Hopes for a comprehensive debt restructuring are overly optimistic without major help from China, its largest creditor, as well as a substantial macroeconomic adjustment program supported by the International Monetary Fund (IMF). Zambia is the first comprehensive case involving all creditor classes this year, and neither the Paris Club nor bondholders will restructure debt without appropriate burden-sharing by China....