Delay in Debt Restructuring “likely” to Increase Zambia’s Cost of Living: Jesuit Scholar

Official logo of the Jesuit Centre for Theological Reflection (JCTR)/ Credit: Courtesy Photo

The slow debt restructuring process in Zambia could result in an increase in the cost of living for the people of God in the Southern African nation, an official of the Jesuit Centre for Theological Reflection (JCTR) have said. 

Zambia has been negotiating with her lenders, under the G20 Common Framework, in view of reaching an agreement for flexible terms to repay its $27 billion debt since 2021.  

“The delayed debt restructuring is likely to contribute to the rising cost of living for an average Zambian,” JCTR Executive Director, Fr. Alex Muyebe, says in a Tuesday, February 21 statement.

Fr. Muyebe says that the rising cost of living is leading households to cut down on the number or quantity of meals per day as well as compromise on nutritional content of these meals. 

“It is also compromising the capacity of households to access decent housing due to reduced real income and therefore worsening the poverty levels in Zambia,” he says. 


The member of the Society of Jesus (Jesuits) further says that the delay in the restructuring process “is blocking investment inflow into the country as investors may not perceive Zambia to be credible.”

He says that the lack of credibility among investors “is making it difficult for the government to meet the needs of its people to the required extent due to limitations of resources.”

“It is very important to understand that no nation can grow in isolation as global partnership and trade is very important. Foreign direct investment boosts the country's reserves, increases the country’s revenue generation capacity, and creates jobs,” Fr. Muyebe says.

The Executive Director of the research, education, and advocacy Jesuit institution adds that “the delayed debt restructuring is also contributing to the instability of the Zambian currency.”

“Zambia’s huge debt overhang is eroding market and investor confidence. Reduced direct foreign investment reduces the country’s forex earnings. For a country that is a net importer like Zambia, high demand for forex to import commodities adds pressure to the country’s reserves and leads to the devaluation of the local currency,” Fr. Muyebe says.

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The devaluation of the Southern African country’s currency “has been evident as the Zambian kwacha has been depreciating against major currencies,” the Executive Director of the Lusaka-based Jesuit Institute whose vision is “a just Zambian society guided by faith, where everyone enjoys fullness of life” further says. 

He adds that the depreciation of the Zambian Kwacha “means more of the Zambian currency is needed to import commodities for consumption.”

“This is likely to lead to an increased inflation rate, which if not accompanied by increased nominal income (salaries) reduces household’s real income implying that household’s income can no longer purchase the same quantity of basic needs (food, shelter, clothing, medicine among others) that it previously could,” the Jesuit Priest says. 

To help Zambians overcome the high cost of living, he says the government needs to hasten bilateral engagement with its largest creditor, China, “to help expedite the restructuring process under the G20 Common Framework.”

“The perceived foreign policy shift must not be allowed to jeopardize the debt restructuring negotiations," he says, adding that the economic and geopolitical dynamics between China and the West should not take precedence over the interest of Zambians.


In January, US Treasury Secretary, Janet Yellen, accused China of delaying Zambia's loan restructuring.

“I know the Chinese have been a barrier to concluding the negotiations,” Yellen said during her visit to the country in January. 

The Chinese government, on its part, told the US to stop interfering with its affairs. 

“The biggest contribution that the US can make to the debt issues outside the country is to cope with its own debt problem and stop sabotaging other sovereign countries’ active efforts to solve their debt issues,” the Chinese Embassy in Zambia said in response to Yellen.

In his February 21 statement, Fr. Muyebe emphasizes the need for speedy negotiations, saying, "It is the Zambian people who are bearing the brunt of delayed debt restructuring and who will bear consequences in the event that the debt restructuring deal collapses."

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Magdalene Kahiu is a Kenyan journalist with passion in Church communication. She holds a Degree in Social Communications from the Catholic University of Eastern Africa (CUEA). Currently, she works as a journalist for ACI Africa.