(Adds IMF comment, country background, bond move)
JOHANNESBURG, May 10 (Reuters) – The International Monetary Fund said on Monday there had been “notable progress” in talks with Zambia on key policy measures to address macroeconomic imbalances, as part of negotiations over a potential loan for the debt-laden copper producer.
“Building on the earlier discussions in February-March, there was broad agreement on the macroeconomic framework,” the Washington-based lender said in a statement.
Zambia’s dollar bonds extended gains on the IMF comments, with the 2027 bond up nearly 1 cent to trade at just over 64 cents on the dollar – levels last seen in early March last year just before the COVID-19 pandemic roiled financial markets, Tradeweb data showed.
The IMF added it looked forward to continuing discussions over an extended credit facility as important measures were taken, adding that Zambian authorities had reaffirmed a commitment to reforms.
Like many African countries, Zambia was hit hard by both the public health and economic impacts of the pandemic, and in November it missed a coupon payment on a dollar bond.
It asked for a financial programme with the IMF in December and sought debt relief in January under a new common framework backed by the Group of 20 major economies and designed to help the world’s poorest countries tackle their debt burdens.
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