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Zambia Will Only Take IMF Bailout If Terms Agreeable, Lungu Says

LUSAKA, Zambia, Capital Markets in Africa: Zambian President Edgar Lungu said Africa’s second-largest copper producer will only access International Monetary Fund support if the lender’s conditions are acceptable. “If we find that there are conditionalities which we find acceptable, we will work with them,” he told reporters Friday in Lusaka, the capital. “If not, we will throw them out.” The southern African nation had earlier said it was working to seal an “inevitable” aid program from the…

Zambia Increases Local Debt Auctions to Fund Bulging Deficit

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Lusaka, Zambia, Capital Markets in Africa — Zambia will boost the value of Treasury bills and bonds it offers to investors taking advantage of increased demand for the securities as it seeks to fund a fiscal deficit that’s set to grow to more than double what Finance Minister Alexander Chikwanda budgeted for. Local-currency debt sales will increase to 700 million kwacha ($71 million) per auction from 450 million kwacha for Treasury bills, and to 800 million kwacha from…

Zambia Prepares Ground for `Inevitable’ Post-Vote IMF Aid

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LUSAKA, Zambia, Capital Markets in Africa — Zambia, reeling from a copper-price slump and a power shortage, is readying for “inevitable” assistance from the International Monetary Fund that may be finalized in December, Treasury Secretary Fredson Yamba said. A deal will only come after general elections set for Aug. 11 and until then, the government will work on lowering electricity and fuel subsidies that the fund last month estimated could cost the southern African nation $660 million a year, Yamba…

Zambia Inflation Accelerates to 12-Year High As Kwacha Weakens …

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Lusaka, Zambia, Capital Markets in Africa — Zambian consumer prices accelerated for a sixth consecutive month to a fresh 12-year high amid a power crisis and currency weakness. Prices rose by 21.8 percent year-on-year in January from 21.1 percent a month earlier, the Central Statistical Office said in a statement handed to reporters on Thursday in Lusaka, the capital. Prices rose 1.3 percent in January from the previous month, it said. Inflation has in Zambia, Africa’s second-biggest copper producer,…

Copper Mine Suspensions Threaten Zambia’s Growth and Fiscal Position

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Lusaka, Zambia, Capital Markets in Africa — Glencore International AG (Baa2 negative) recently announced that it would suspend operations at its Mopani Copper Mine in Zambia (B1 negative) for 18 months. Glencore’s suspension follows a recent decision by China’s Luanshya Copper Mines plc to interrupt operations at its Baluba mine in Zambia. Reduced copper production is credit negative for Zambia because it will depress growth, export proceeds and royalties, further pressuring the sovereign’s increasingly precarious fiscal…

Zambia maintains rate, tight liquidity to contain inflation

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Lusaka, Zambia (Capital Markets in Africa) — The Bank of Zambia (BoZ) opted to leave the benchmark interest rate unchanged at 12.5% this week. The BoZ has aggressively tightened policy this year by hiking the cash reserve requirement ratio for banks from 14% to 18%. However, it has not lifted the benchmark interest rate since November 2014. During 2014 the interest rate was hiked aggressively by 275 basis points. The BoZ noted that the kwacha…

Zambia to issue up to $2 bln 10-year Eurobond – govt

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LUSAKA, Zambia (Capital Markets in Africa) – Zambia will issue a 10-year Eurobond of as much as $2 billion on Thursday, one of frontier Africa’s biggest international bonds, to fund a widening budget deficit in the copper exporter, a presidential spokesman said. “We expect the Eurobond to be issued today. It will be between $1.5 billion and $2 billion and the maturing date is 10 years,” Amos Chanda, a spokesman for President Edgar Lungu, told…

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