06/06/2026
A Simple Truth About the Eurobond Buyback
By Kennedy Chileshe
With profound gratitude to Prof. Lubinda Haabazoka for his original, detailed analysis
I have just finished reading an outstanding piece by Prof. Lubinda Haabazoka on Zambia’s decision to buy back over US$1.3 billion worth of Eurobonds. It is a brilliant financial analysis. But let me be honest: many Zambians don’t live in the world of bonds, coupons, and principal repayments. We live in a world of school fees, maize prices, and long queues at the clinic. So let me translate this into the language of the common man. And in doing so, let me show you exactly why I continue to stand firmly behind this President.
What is a bond? Let me use a simple example.
Imagine you borrow 1,000 kwacha from a friend. You promise to pay back the 1,000 kwacha after ten years. But every year, you must pay your friend 80 kwacha just for the privilege of using that money. That 80 kwacha is called interest. Now, here is the trap: for ten full years, you pay 80 kwacha every single year, but the original 1,000 kwacha never reduces until the very end. That is how a bond works. Now imagine that loan is in US dollars, but you earn in kwacha. If the dollar rises, your debt explodes overnight. That is the nightmare Zambia has been living.
Between 2012 and 2015, Zambia borrowed nearly US$3 billion through these expensive Eurobonds.
At first, it seemed like progress. But then commodity prices collapsed, droughts hit, and the kwacha crumbled. By November 2020, Zambia became the first African country to default on its debt during COVID. That default was not just a newspaper headline. It meant investors fled. It meant our currency was mocked in international markets. It meant every kwacha the government collected was swallowed by interest payments. Nothing was left for roads, hospitals, or teachers. That was the crisis this President inherited.
So what has this President done? He is buying back the expensive debt at a discount.
Think of it like this: you owe someone 1,000 kwacha, but you negotiate to pay only 780 kwacha to cancel the entire debt forever. That is exactly what the government is doing. Zambia is buying back US$1.36 billion worth of Eurobonds at roughly 78 cents on the dollar. Once purchased, those bonds are cancelled permanently. They will never demand another kwacha from Zambian taxpayers. And where is the money coming from? A US$600 million facility from the African Development Bank at much lower interest rates than the original Eurobonds. That is not just smart. That is transformational.
Why does this matter to you, the ordinary Zambian? Let me count the ways.
First, it lowers interest costs immediately. Instead of paying high commercial rates, Zambia will pay far less to the African Development Bank. Second, it removes decades of future payments. Those bonds were not set to mature until 2053. Think about that: your children and grandchildren would still be paying for debt taken before they were born. Third, it improves Zambia’s reputation. The African Development Bank does not hand out US$600 million to failing states. They are betting on Zambia because they see discipline, transparency, and a President who keeps his word.
Every dollar served means progress for Zambia. That is the simple truth that many people miss. Debt servicing competes directly with development. When you spend money paying foreign bondholders, that same money cannot pay a nurse’s salary, cannot fix a broken ambulance, cannot drill a borehole in a drought-stricken village. By retiring expensive Eurobonds and replacing them with cheaper financing, this President is creating fiscal space. That is the boring, hardworking, unglamorous path to genuine development. And it is working.
As a nation,we need to stand with President Hakainde Hichilema. He is cleaning up a mess he did not create. The borrowing happened years before he took office. But instead of blaming the past, he is fixing the future. Second, he has restored Zambia’s credibility. Only a few years ago, we were in debt distress and locked out of capital markets. Today, major institutions are lining up to support us. That confidence is earned through discipline, not speeches. Third, he thinks about ordinary people. Every decision he makes is measured by one question: does this help the Zambian family? The Eurobond buyback does exactly that.
A country that defaulted not long ago is now voluntarily buying back its own bonds at a discount. That is not failure. That is recovery. That is leadership. This President does not shout on social media. He does not make empty promises. He works quietly, steadily, and effectively to reduce debt, stabilise the economy, and create room for development. That is the kind of leader Zambia needs. That is why I stand with him.
You do not need a degree in economics to understand this. If a leader reduces debt, he reduces suffering. If a leader lowers borrowing costs, he frees money for schools, hospitals, and roads. If a leader restores the country’s reputation, he opens doors for investment and jobs. This President has done all three. That is not opinion. That is fact. And that is why, today and tomorrow, I stand with this President.
Kennedy Chileshe
Proud Zambian
