The French government announced on Thursday that it had reached an agreement with China, of which Zambia is its biggest creditor, and other creditor countries for a $6.3 billion loan restructuring, according to the Associated Press (AP).

The deal gave landlocked African countries concessions to facilitate debt repayments to China, to which Zambia owes $4.1 billion, as well as to France, Britain, South Africa, Israel and India, the newspaper said. Associated Press report. According to the Associated Press, the deal was developed in conjunction with the global financial summit in Paris and was approved by the International Monetary Fund (IMF).

Bilateral financial institutions led by China and France have agreed to extend the maturity of loans to Zambia by about 20 years, with a grace period of three years, according to reports. bloomberg. (Related: Study Reveals How China Became World’s Biggest Loaner)

Treasury Secretary Janet L. Yellen Press Conference, Paris, France June 22, 2023 https://t.co/AdJ40JmWp8

— Treasury Department (@USTreasury) June 22, 2023

The two-day Summit for a New Global Financial Agreement will explore new financial solutions to the global challenges of poverty and climate change. “Policy makers and states should never have to choose between reducing poverty and protecting the planet,” Macron said in his opening address to the summit. Le Monde report.

The deal is the first major fiscal bailout to developing economies under the G20 common framework that brings the Paris Club’s traditional creditors to the negotiating table with new creditors China and India, Bloomberg. report. Le Monde said China had previously stayed away from multilateral efforts to ease the debt burden of developing countries.

U.S. Treasury Secretary Janet Yellen said she “welcomes the agreement reached by official creditors on the settlement of debts to Zambia,” according to a report on Thursday. press release From the Ministry of Finance.

Zambia is one of about 60% of low-income countries at high risk or already in debt crisis after the COVID-19 pandemic, according to IMF experts Kristalina Georgieva and Seira Pazarvasioglu. , up from 30% in 2015. I got it In an IMF blog post.