State creates Eurobond repayment fund


GOVERNMENT has established a sinking fund for the repayment of two sovereign Eurobonds.
Chief government spokesperson Chishimba Kambwili said at a press briefing in Lusaka yesterday that Cabinet on Monday approved in principle the establishment of a sinking fund for the repayment at maturity of the US$750 million and the US$1 billion bonds in 2022 and 2024, respectively.
A sinking fund is a fund established by an economic entity by setting aside revenue over a period of time to fund a future capital expense, or repayment of a long-term debt.
Mr Kambwili, who is also Minister of Information and Broadcasting Services, said this when announcing Monday’s Cabinet meeting resolutions.
He said the fund is expected to run over nine years and will help to ensure accumulation of resources for the repayment of the bonds at maturity.
He said the move will reduce pressure on the national budget and mitigate against foreign exchange risks.
Mr Kambwili said the establishment of the fund will also ensure the credibility and integrity of the country on the international capital market.
The minister said Cabinet also approved the Higher Education Loans and Scholarships Board Bill of 2015, which seeks to put in place appropriate legislation for recovery of student loans.
“The bill seeks to repeal Statutory Instrument No 182 of 1973 of the Education Act Cap 34 of the Laws of Zambia to help establish the Higher Education Loans and Scholarship Board,” Mr Kambwili said.
Mr Kambwili also said Cabinet also approved the Gender Equity and Equality as well as Border Management bills. The three bills will be taken to Parliament.
The minister said the legislation on gender equity and equality will facilitate the elimination of the various forms of discrimination against women in accessing productive resources, education opportunities and quality basic health services.
It also seeks to increase the number of women in decision-making positions in the public and private sectors.
Mr Kambwili said the Border Management Bill of 2015, which will also be introduced to Parliament, seeks to rationalise, co-ordinate and harmonise the interaction between various agencies at the border posts.
He also announced that Cabinet authorised ministers of Justice and Finance to resolve all outstanding issues surrounding the Kasumbalesa border post concession.
“This is with a view to honouring Government’s obligations to the concessionaire and the Development Bank of South Africa. Government intends to get a win-win situation over this matter,” he said.

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