Sovereign haircuts / ZWE
Zimbabwe
One concluded restructuring, settled in 1980. It cost creditors 0.0% of the present value of their claim, 15 years after the default that began in 1965.
Every restructuring
Two measures of the same deals, never combined. The present-value haircut discounts what creditors got against what they were owed; the face-value reduction counts only principal written off.
| Default | Settled | Years to settle | Present-value haircut | Face-value reduction | Debt treated (2020 $) | Source |
|---|---|---|---|---|---|---|
| 1965 | 1980 | 15 | 0.0% | 18.8% | $834M | Meyer, Reinhart and Trebesch (2022) |
Source: Meyer, Reinhart & Trebesch (2022), Sovereign Bonds since Waterloo | Cruces & Trebesch (2013), Sovereign Defaults: The Price of Haircuts | Asonuma & Trebesch (2016) Debt treated is the amount restructured, deflated to constant 2020 US dollars in the source file. A negative haircut means the new instruments were worth more than the old claim. Methodology
Default spells
| Spell | From | To | Years | Restructurings |
|---|---|---|---|---|
| ZWE_1965-1980 | 1965 | 1980 | 16 | 1 |
Source: Meyer, Reinhart & Trebesch (2022), Sovereign Bonds since Waterloo | Cruces & Trebesch (2013), Sovereign Defaults: The Price of Haircuts | Asonuma & Trebesch (2016) Duration counts both endpoints. The spells table also carries a cumulative-haircut column; it is not published here because it does not reconcile with the per-episode haircuts, see the methodology. Methodology
Debt still in default
$8.60B across 7 creditor classes in 2024. A haircut can only be measured once a restructuring concludes, so any of this that is still being negotiated is by construction absent from the tables above.
| Creditor class | In default, 2024 |
|---|---|
| Other private creditors | $4.01B |
| Paris Club (bilateral official) | $1.78B |
| World Bank (IBRD) | $1.13B |
| China (official) | $591.0M |
| Other official creditors | $586.0M |
| World Bank (IDA) | $419.0M |
| Foreign-currency bonds | $87.0M |
Source: Bank of Canada-Bank of England Sovereign Default Database (CRAG) Bank of Canada terms (attribution). Includes domestic arrears, so it is not comparable with the debt-treated column above. Methodology
Restructurings with Chinese creditors
5 restructurings with Chinese creditors are recorded here. No haircut is attached to any of them, so they cannot be placed on the scale above; the file records only whether face value or the interest rate was cut.
| Year | Type | Creditor | Terms |
|---|---|---|---|
| 2003 | Debt rescheduling only | China Ex-Im Bank | First rescheduling of the 1997 China Ex-Im Bank buyer's credit to ZISCO. The agreement reduced interest rates by 300 bps. from 7 to 4 percent per year and extended the maturity by 3 years. |
| 2004 | Debt rescheduling only | China Ex-Im Bank | In 2004, China Ex-Im Bank restructured a RMB 48.2 mn Government Concessional Loan to the Government of Zimbabwe’s Industrial Development Commission (IDC). The loan carried the following original loan terms: a 15-year maturity, 5-year grace period, and 3% interest rate. The 2004 agreement reduced the interest rate by 100 bps. and extended the maturity by 4 years. |
| 2007 | Debt rescheduling only | China Ex-Im Bank | Second rescheduling of the 1997 buyer's credit loan to ZISCO that had already been restructured in 2003. The 2007 agreement introduced an additiona 3-year grace period. |
| 2010 | Debt rescheduling only | China Ex-Im Bank | Third rescheduling of the 1997 buyer's credit loan to ZISCO that had already been restructured in 2003 and 2007. The 2010 agreement extended the grace period by another 3 years. |
| 2012 | Debt rescheduling only | China Ex-Im Bank | In 2012, China Ex-Im Bank restructured a 2006 200 mn USD buyer's credit for an Agricultural Supply Project. The loan originally carried a 5-year grace period, an 11-year maturity and was supposed to be repaid by export procceds from platinum. The 2012 restructuring agreement granted an additional 3-year grace period after Zimbabwe had failed to repay the loan in time. |
Source: Horn, Reinhart & Trebesch, China's overseas lending and debt restructurings Methodology