S&P Global Ratings on Monday reaffirmed Zambia's sovereign credit ratings at CCC+/C and kept the outlook steady following the government's tender to repurchase an outstanding Eurobond maturing in 2053.
The Zambian government announced the tender offer on May 29, 2026, targeting holders of a $1.36 billion fixed-rate step-up amortizing bond due in 2053. Authorities amended the terms on June 4, 2026, extending the early participation deadline to June 9, 2026 and sweetening the offer with a $65 million incentive for holders who participated early.
The repurchase price range was set between 82.76 cents and 84.35 cents on the dollar, inclusive of the early tender fee - a level below par but above market prices prevailing when the initial offer was announced. S&P Global described the operation as opportunistic liability management rather than an indication of default, noting that the government would have been able to meet the bond's scheduled payments on time and in full without undertaking the transaction given the country's improving macroeconomic backdrop.
To support the redemption, Zambia secured a $600 million facility from the African Development Bank, which, together with the government's own liquidity resources, is intended to finance the repurchase.
S&P Global said the sovereign's CCC+ rating continues to reflect strained public finances, including high general government debt levels and an elevated debt burden - factors that persist despite Zambia's exit from default in November 2025.
As of Dec. 31, 2025, Zambia had reached an agreement in principle to restructure 94% of the $13.34 billion of external debt within its restructuring perimeter. Fully restructured agreements accounted for 60% of that amount at the same date.
The ratings agency balanced signs of gradual fiscal improvement and the availability of official support against several risks. It highlighted elevated near-term borrowing requirements and the ongoing nature of external debt restructuring as material uncertainties. Nonetheless, S&P Global projected that external buffers, along with rising copper prices and higher export volumes, would continue to bolster Zambia's external position, even as imported energy costs increase.
Contextual note: The ratings decision frames the bond repurchase as a strategic liability-management move supported by official financing, while emphasizing that structural fiscal challenges and active restructuring processes remain central to the sovereign credit profile.