Zambia has a lot of work to do in order start achieving inclusive double-digit GDP growth which will go a long way into helping absorb an ever increasing number of the youth population into the job market. One sector which seems to be moving in a positive direction is Copper mining - which accounts for north of 75% of exports and over 12% of GDP. LME Copper prices are up 21% over the last year, closing at $6,712/MT on Friday last week:
The Minister of Finance recently revealed that the Government was looking to refinance the Eurobond portion of the external debt ($6.7bn as of September 2016) stock with a view to securing new long-term debt with lower interest rates. This also came up last year as the Treasury Secretary talked about various options that the Government was exploring with respect to external debt.
.Bank of Zambia released a statement on their website informing the public that it had taken possession of Intermarket Banking Corporation on account of the fact that the entity was insolvent. Insolvency breaches Section 81 of the Banking and Financial Services Act (BFSA):
The Bank of Zambia is empowered by section 81 of the bfsa to take POSSESSION of a financial service provider, where in its opinion, an inspection of the financial service provider instituted under this act shows that:
Intermarket Bank is one of 19 registered commercial banks in Zambia. It is majority owned by Afriland First Group of Cameroon. Their website is currently down and their is'nt any publicly available data to ascertain how many depositors have exposure to this bank.
Finance Minister Felix Mutati presented a K64.5 billion ($6.6bn) 2017 National Budget to Parliament emphasizing that "we cannot spend money which we do not have". This, against the backdrop of a 20% rise in the price of copper (the country's top export) courtesy of Chinese speculators, the removal of fuel subsidies (which cost the treasury K2.7 billion in 2015) and news that the 2016 budget deficit was set to come in at 10%.
Last Thursday's K450 million ($47m) Treasury Bill (T/bill) auction attracted K1.1 billion ($120m) in bids as yields fell for the second auction in a row:
Economic growth slowed down to 3.7% in 2015 primarily due to the negative effects of prolonged load-shedding in the second half of the year as well as a significant decline in the currency.
By GlobeNewswire, March 21, 2016, 04:38:00 AM EDT
Ericsson (NASDAQ:ERIC) has extended its partnership with Airtel Zambia, headquartered in Lusaka, Zambia, with a new contract covering the transformation of Airtel's radio access network (RAN) infrastructure in every major region of Zambia. This extended partnership will both optimize the subscriber experience and strengthen Airtel's market leadership in the country.
REIZ 2015 Net Profit Increases 953% Y/Y to K453M on Accounting Adjustment as it Mulls Offers for Majority Stake
Real Estate Investments Zambia (LuSE: REIZ) saw net profit rise by a multiple of 10 year-on-year (y/y) in 2015 to K453 million. Earnings per share came in at K8.02 (K0.75 in 2014):
Lafarge Zambia (LuSE:Lafarge) saw net profits decline by 23.9% year-on-year to K323 million in 2015. Earnings per share came in at K1.61 (K2.12 in 2014):
Cabinet recently approved engagement of the International Monetary Fund (IMF) with a view to setting up a program. The economy has been hit by shocks from a 70% depreciation of the currency versus the US dollar in 2015, a 590MW electricity deficit which started in H2 2015 and a decline in global copper prices (contribute over 70% of export earnings). This has put even more pressure on Government finances which are not only committed to major infrastructure projects but are also subsidizing a number of things in addition to forking out more Kwachas to pay interest on external debt ($6.4b as of eoy 2015).
Trying to decipher this puzzle that is Zambia by using a variety of publicly available data (structured and unstructured) in conjunction with my own skill/experience. * * *