SCAN MARKET FOR EUROBOND REFINANCING – SAASA

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By BUSINESS REPORTER

GOVERNMENT should not single source a partner to refinance the eurobonds because the market can offer better deals, says Premier Consult Limited managing consultant, Oliver Saasa.

Zambia’s first Eurobond, the US$750 million falls due in 2022.

Professor Saasa emphasised that Government should first scout the market before single sourcing a partner.

He said in an interview in Lusaka that refinancing was common and was not bad practice

“With respect to rolling out in terms of refinancing, it is common and it happens. It is the manner in which you manage it.

“The next Eurobond bullet payment is 2022, we still have a bit of time, once we decide on rolling out through refinancing, we have to do the right things including scouting the market; do not just go for one offer,” he said.

Prof Saasa said the cost of refinancing would be determined by how the image of Zambia would be perceived at a time the deal would be concluded.

He emphasised that the current debt management would also have an effect as to how much it would cost the country during the process.

“Yes, refinancing is fine, it has happened before, most importantly for Zambia, you know we have had voucher funds, those that will just come, you default and then you pay through your nose because they know you are desperate.

“So I would not go along with the idea of just single sourcing, picking somebody when the market might give you something better,” Prof Saasa said.

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