Zambia and Saudi Arabia have reached a landmark agreement to restructure part of Zambia’s outstanding debt, rescheduling over $130 million of the African nation’s financial obligations to the Kingdom. The debt restructuring deal, signed in Lusaka on Thursday, marks a significant step in addressing Zambia’s fiscal challenges and securing long-term economic stability.
The agreement was signed by Zambia’s Finance Minister Situmbeko Musokotwane and Sultan bin Abdulrahman Al-Marshad, CEO of the Saudi Fund for Development, during a ceremony attended by senior officials from both nations. Al-Marshad emphasized that the deal symbolizes the continued and growing partnership between Zambia and Saudi Arabia in terms of development and mutual cooperation.
“We believe this agreement is a testament to our strong and enduring partnership with Zambia,” Al-Marshad said. “It represents the ongoing collaboration between our countries to foster economic growth, improve financial stability, and contribute to the well-being of Zambia’s citizens.”
Alongside the debt restructuring, the two nations also signed a separate agreement approving a $35 million loan to support the construction of the King Salman Specialized Hospital in Zambia. The new healthcare facility, named after Saudi Arabia’s King Salman, is designed to bolster Zambia’s healthcare infrastructure, offering advanced medical services to improve access to high-quality care.
Minister Musokotwane highlighted that the debt restructuring and the loan agreement for the hospital demonstrate Zambia’s commitment to achieving fiscal sustainability while advancing its broader development goals. “This agreement reflects a shared vision for Zambia’s economic future,” Musokotwane stated. “Through this partnership, we are addressing our debt challenges and creating opportunities for growth, development, and improved social services.”
The agreements come as Zambia faces the dual challenge of managing its rising public debt while striving to enhance economic growth and development. In recent years, Zambia has sought assistance from international partners to help alleviate its financial strain, especially following the country’s debt default in 2020. With these new arrangements, Zambia hopes to stabilize its economy, improve its debt management practices, and attract further investment.
These developments underscore the strengthening ties between Zambia and Saudi Arabia, both of which are focused on addressing critical infrastructure needs, economic resilience, and long-term sustainability.