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China's lending pushed Zambia into financial distress: Report
In Short
The report from Asia Times -- citing an International Consortium of Investigative Journalists investigation
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China's mega banks helped Zambia finance
Mumbai: China's mega banks helped Zambia finance an ambitious infrastructure drive but were creating a debt buildup that ultimately pushed the country into financial distress, a new report has said.
The report from Asia Times -- citing an International Consortium of Investigative Journalists investigation -- said Chinese lenders, including major state-linked banks, continued extending loans as Zambia’s debt burden mounted, while Chinese contractors encouraged state entities to borrow for infrastructure projects.
It mentioned a farmer in Lusaka, Zambia, who uprooted entire rows of organic vegetables in October 2025 and fed them to her pigs due to a power crisis fuelled by mindless borrowing adopted by the country.
“There was nothing we could do. There was no water for the crops because there was no electricity," she said as persistent blackouts in Zambia left swaths of the country without power.
The backouts were a result of load shedding, or scheduled power cuts meant to reduce demand on the grid. ZESCO, the state-owned power company supplying nearly all of Zambia’s energy needs, alerted its customers to the load shedding schedule, but the farmer said that the published schedules were inconsistent or unreliable.
"Chinese lenders like ICBC were willing to make onerous and high-risk loans to a country that could not afford them. Meanwhile, Chinese companies seeking infrastructure contracts urged Zambian state entities to take on new debt to fund those projects," the report said.
Zambia’s government, seeking readily available financing for roads, airports and other works, entered into a borrowing spree from Chinese lenders, but the timing coincided with falling global copper prices, the country’s main source of export revenue.
The debt accumulation eventually triggered a crisis, with rating agencies warning of rising external indebtedness and widening fiscal deficits.
Finally, Zambia fell into a disastrous debt spiral and found itself unable to service its debt, followed by years of sluggish recovery. The report questioned the logic of lending as several Chinese-funded projects were awarded without competitive bidding, carried inflated costs and offered limited economic returns.
The publication citing Afrobarometer survey data said public attitudes toward China’s influence have shifted, as positive views of China’s economic and political role in Zambia fell from 72 per cent in 2014 to 42 per cent in 2022.
