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.
Here's the full statement from the agency:
Fitch Ratings-Hong Kong-24 February 2016: Fitch Ratings has revised the Outlooks on Zambia's Long-term foreign and local currency Issuer Default Ratings (IDR) to Negative from Stable and affirmed both ratings at 'B'. Fitch has also affirmed Zambia's Short-term IDR at 'B' and the Country Ceiling at 'B+'. The issue ratings on Zambia's senior unsecured foreign and local currency bonds have been affirmed at 'B'.
Presidential Statement on Currency and Energy Challenges
Following the deterioration of the currency and energy situation in the country in recent months, His Excellency Mr. Edgar Chagwa Lungu, President of the Republic of Zambia has intervened to guide monetary and fiscal policy measures designed to stabilise the markets. (Read more)
Yesterday’s Treasury bill (T/bill) auction attracted K311 million in bids of which K160 million were allocated:
The subscription rate on the 14th auction of the year declined to 34.58% (62.3% at auction 13). The Minister of Finance indicated that the Government would cut back on domestic borrowing to finance the 2015 fiscal deficit for fear of further pushing up yields - and subsequently interest rates:
Moody’s affirms Zambia rating at B1, downgrades outlook to negative
Moody's Investors Service ("Moody's") has today affirmed Zambia's B1 government bond rating and changed the outlook to negative. The key drivers for the negative outlook are:
- Deteriorating debt metrics, as evidenced by a rapidly rising debt burden and increasing debt servicing costs;
- A trend of missed fiscal targets that points to high execution risks in current deficit reduction plan to arrest the upward debt trajectory, particularly amid spending pressures in the lead up to next year's presidential election;
- The shift of the current account into deficit, removing a key credit support that has historically suppressed external vulnerability. (Read more)
Zambia to triple petrol supply to ease shortage in capital
Zambia plans to triple petrol supply to 900,000 litres a day using imported stocks in its storage depots after panic buying by motorists led to shortages in the capital, the energy minister said on Wednesday. Christopher Yaluma told parliament that petrol supply to the capital and outlying areas was doubled to about 600,000 litres per day this week but shortages persisted. (Read more)
The following is the statement that Fitch Ratings released on Friday:
Fitch Ratings has revised the Outlook on Zambia's Long-term foreign and local currency Issuer Default Ratings (IDR) to Positive from Stable and affirmed the IDRs at 'B'. The issue ratings on Zambia's senior unsecured foreign and local currency bonds have also been affirmed at 'B'. The Country Ceiling has been affirmed at 'B+' and the Short-term foreign currency IDR at 'B'.
Ratings agency Fitch Ratings has affirmed Zambia's credit rating at 'B' with a stable outlook. They released the following statement today:
Fitch Ratings has affirmed Zambia's Long-term foreign and local currency Issuer Default Ratings (IDRs) at 'B'. The issue ratings on Zambia's senior unsecured foreign and local currency bonds are also affirmed at 'B'. The Outlooks on the Long-term IDRs are Stable. The Country Ceiling is affirmed at 'B+' and the Short-term foreign currency IDR at 'B'.
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. * * *