Haemorrhaging Zambia: Underlying sources of the current sovereign debt crisis
By Andrew M. Fischer
Following a stand-off with commercial creditors and protracted but unresolved negotiations with the IMF, Zambia defaulted on its external sovereign debt on 13 November this year. While most commentary has focused exclusively on the government’s sovereign borrowing, our own research has detected massive outflows of private wealth over the past 15 years, hidden away in an obscure part of the country’s financial account. The outflows are most likely related to the large mining companies that dominate the country’s international trade. With many other African countries also facing debt distress, this huge siphoning of wealth from Zambia provides crucial lessons that need to be central in discussions about debt justice in the current crisis. We explain here what we’ve found.
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