Tokyo — JAPAN has written off K3.4 trillion of the K4 trillion owed it by Zambia.

The cancellation of the debt, which represents 87.8 per cent of Zambia's indebtedness to Japan, came out of discussions between President Levy Mwanawasa and Japanese Prime Minister, Junichiro Koizumi here in Tokyo.

This means that Zambia now owes Japan only K600 billion.

The cancellation emerged from the signing of the Exchange Notes between the two governments at the Japanese-Style Annex, State guest house today.

Finance and National Planning Minister, Ng'andu Magande signed on behalf of the Zambian Government while Japanese ambassador to Zambia Masaaki Miyashita signed for his country.

About K140 billion covering debt service payments arrears due for the period between April 1, 2002 and March 31, 2003, and K116 billion due for term running from April 1, 2004 to March 31, 2005 will be cancelled before March 31 this year.

The remainder of the amount would be cancelled once the announcement on the assessment on reaching the Highly Indebted Poor Countries (HIPC) initiative completion point is made.

The cancellation of Zambia's debt represents the highest bilateral write-off received since the country acceded to the HIPC initiative in December 2000.

It follows the termination of the ŒDebt relief for Grant Aid' scheme.

It was prompted by the realisation that under the scheme, outstanding debts of most developing countries like Zambia, would continue for a long period of time and that acquiring foreign currency to repay the debts continues to be a hindrance to the development of these countries whose exports have been low.

After the signing of the Exchange of Notes, Mr Magande assured the Japanese government and people that the savings from the debt relief would be used in a dilligent, transparent and accountable manner in order to alleviate poverty and create wealth for the majority of Zambians.

President Mwanawasa and chief cabinet secretary and minister for foreign affairs of the Japanese government, Hiroyuki Hosoda, witnessed the signing of the Exchange Notes.

Meanwhile, President Mwanawasa has said African ambassadors accredited to Japan had an important role to play by negotiating for economic development of their respective countries.

Mr Mwanawasa who met African ambassadors at Hotel New Otani this morning said African ambassadors were not in Japan on holiday but to carry out work as assigned by their governments.

He said he expected the ambassadors to do work that would ensure that poverty levels in their countries were reduced as there was need to wage an economic battle in order to come up with an equitable distribution of wealth.

The President also told the envoys that a new era of democratic governance and the rule of law had dawned in the Southern Africa Development Community (SADC) region and tabulated free, fair and peaceful elections which were held in South Africa, Malawi, Botswana, Namibia and Mozambique, heralding a new political dispensation.

He said with respect to regional integration and economic cooperation, SADC member countries continued to work together in pursuit of this objective.

'A vivid example in this regard was the official launch of the Mtwara Development Corridor in Lilongwe, Malawi on December 15, 2004 which is one way of creating an enabling environment for regional and international trade,' Mr Mwanawasa said.

He said, apart from SADC, the Common Market for Eastern and Southern Africa (COMESA) was another building block for regional integration and economic development in the region.

On the political situation in Africa, Mr Mwanawasa said it was encouraging to note that despite the various conflicts in some countries, there was renewed hope of finding lasting solutions to the problems.

He cited the election of a new government in Somalia, the signing of a ceasefire agreement between the Government and the Sudan People's Liberation Movement/Army (SPLM/A) last month and the current peace talks in Ivory Coast that he described as positive developments.

Mr Mwanawasa said fresh efforts would be made at the African Union (AU) meeting in Nigeria this monthend to encourage conflicting parties to come to the negotiating table to find amicable solutions to their differences.

He said Africa joined the rest of the world in mourning the victims of the tsunami disaster that hit countries in the South-East Asian region, leaving more than 150,000 dead and millions displaced.

He said the AU supported calls for the reform of the United Nations (UN) in order to make it more democratic and representative.

'We call for the establishment of a new world order with justice and equality for all. We condemn terrorism wherever it occurs in the world and encourage peaceful resolution of conflicts.

'We join progressive forces of the world in calling on all stakeholders to the Middle East conflict to redouble their efforts in seeking a permanent solution to that conflict,' he said.