Russia Cancels $111.8 mln Zambia Debt

Posted 02 January 2007 @ 02:38 pm EET     Print     Reprint     E-Mail     Comments

LUSAKA (Reuters) - Russia has cancelled $111.8 million in debt owed by Zambia, treasury spokesman Chileshe Kandeta said on Tuesday. Kandeta said Russia, part of the Paris Club of international lending nations, has become the latest in the group to cancel Zambia's debt after the southern African country's sustained macroeconomic performance.

"Russia has written off (the) $111.82 million debt Zambia owes. The measure by Russia means that all Paris Club members have delivered their pledges for Zambia's debt write-off," Kandeta said in a statement.

Kandeta said Russia urged Zambian authorities to use the funds saved from debt servicing after cancellation of the debt on poverty reduction programmes and environmental protection.

In 2006, Zambia's foreign debt was reduced to $502 million from $7.2 billion in 2005 after the International Monetary Fund (IMF), the World Bank and western donors awarded the country debt relief under global plans to cut debts owed by some of the world's poorest countries.

Zambia is enjoying solid economic growth and has been praised by Western governments for prudent economic policies, although critics say poverty remains widespread and the country is still not reaping enough benefits from its vast copper resources. One in five Zambians lives with HIV or has full blown AIDS while 68 percent of the country's 11.5 million live in abject poverty.