Zambia’s vice president told lawmakers that the country, which has until the end of the day to make a payment on a missed Eurobond coupon, would not default, according to comments broadcast on local radio on Friday. Zambia is due to pay a $42.5 million coupon on one of its $3 billion dollar-denominated sovereign bonds when the 30-day grace period expires at the end of Friday. If it fails, it will suffer Africa’s first post-COVID sovereign default. The government has scheduled meetings with creditors to hear whether they will grant Zambia a payment reprieve until April. “This country is not ready to default, and I can assure the honourable members that this country will not default,” Vice President Inonge Wina told lawmakers during questions and answers in parliament. She did not say if Zambia had already initiated the coupon payment. However, she said the government talking to bondholders and the finance minister would soon update the nation on the outcome of those talks. Zambia External Bondholder Committee — a large group of creditors holding more than 40% across all Zambia’s bonds and a blocking stake in each issue — indicated it would reject the government’s plan, citing a lack of transparency and communication. “Investors are really miffed that Zambia had three years to go to the International Monetary Fund and get some funds, but refused to let the fund into the country to avoid painful reforms,” said Lutz Roehmeyer, CIO at Capitulum Asset Management, who voted to support the payment deferral but is not part of the group. The government said it was doing everything possible to avoid a sovereign debt default, though it has also pledged to seek similar terms from all its external creditors on debt service suspension. Zambia’s finance ministry did not immediately respond to a request for comment. If Zambia is not granted a payment deferral and does not pay its coupon, it would be classified as a default on its three outstanding Eurobonds with a face value of $3 billion. Even before the coronavirus pandemic caused a global economic slowdown, Zambia was struggling with mounting debt. Data from Lusaka showed that Zambia’s total external debt stock stood at $4.8 billion, or 18% of gross domestic product, by the end of 2014. Five years later, it had more than doubled to $11.2 billion, or 48% of GDP. The IMF predicts a rise to nearly 70% by year’s end. The Eurobonds are not its only debt. Zambia owes some $3.5 billion in bilateral debt, $2.1 billion to multilateral and $2.9 billion to other commercial lenders. It owes about $3 billion to China and Chinese entities. Zambia’s kwacha has tumbled nearly a third since the start of the year, adding to the pressure. Zambia’s dollar bonds are trading between 45-47 cents on the dollar, according to Tradeweb data. With a number of African countries struggling with unsustainable debt, Zambia is being closely watched as a test case for how borrowers and creditors might navigate a broader debt crisis. “African countries need to come to some resolution quickly in order for them to also deal with other pressing health and economic issues that COVID has exacerbated,” said Jacqueline Musiitwa, managing partner at Hoja Law Group. “Right now, there just needs to be more transparency in general to make sure that Africa finds a solution, not only for the short term but also for the long term.”