Zambia is on the brink of defaulting on its foreign debt after it missed a payment of more than $40m (£30m) last month.
A so-called grace period will expire on Friday, which would make it Africa’s first country to default on sovereign debt since the coronavirus pandemic.
Zambia was already struggling with its $12bn external debt load.
But coronavirus has aggravated pre-existing financial pressures in the country.
Zambia on brink of defaulting on foreign debt https://t.co/rFLp7gYi60— BBC News (World) (@BBCWorld) November 13, 2020
The pandemic has put an additional burden on health services and depressed economic activity and the government has said that is the cause of its difficulties.
But critics have blamed President Edgar Lungu’s poor economic management and there have been concerns about corruption in recent years.
Zambia has asked for a delay to interest payments until April next year but creditors have not yet agreed.
The debt includes about $3bn in bonds issued in Europe.
The country has been lent money by China and Chinese institutions amounting to $3bn, the Reuters news agency reports.
The China Development Bank has agreed to a six-month delay in debt repayments, but creditors outside China complain that the exact terms and structure of the Chinese loans are unclear.
According to Stephen Chan, an expert on African politics at the University of London, the last five years in Zambia has seen “quite a reckless splurge in terms of debt accumulation”.
He told the BBC’s Newsday programme that without a plan to repay the debt, a moratorium may not be forthcoming.
Zambia’s Finance Minister Bwalya Ng’andu told the Reuters news agency earlier this week that the country was doing “everything possible” to avoid a default.