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.
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)
Zambia set to end power tariff subsidies for large firms
Zambia's government will stop supplying cheap electricity to large industries as Africa's second largest copper producer battles a costly power shortages. The move away from subsidized electricity tariffs for large consumers will happen immediately, while state utility Zesco will source energy from private producers to plug the deficit, government spokesperson Vincent Mwale said.(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:
Thursday’s Treasury bill (T/bill) auction attracted K464 million in bids with K386 million being allocated:
Mining tax changes set to be tabled at cabinet meeting on Monday
Zambia's cabinet will table changes to mining royalties on Monday after the finance and mines ministers proposed the amendments, the president's spokesman said on Thursday. Zambian President Edgar Lungu last month directed the finance and mining ministers to change royalties on mining firms by April 8, saying the copper-producer could consider temporarily reverting to the tax regime in 2014. (Read more)
VAT rule 18 amended
Effective February 23 2014, VAT ‘rule 18’ is set to be amended to include import documents from a transit country as sufficient proof of export as well as scrapping the provision requiring export proceeds to be deposited in Zambian accounts (proof of payment by an intermediary should suffice). For transactions prior to February 23, exporters will be required to fulfil the old rules. [KPMG Zambia release on 20.02.2015]
2014 has been a bit of a rollercoaster year for Zambia. The country lost President Michael Chilufya Sata to illness a few days after celebrating its 50th year of existence. The consumer was under tremendous pressure as the effects of a weaker Kwacha took hold over the course of the year.
Government considering scrapping corporate tax, upping mineral royalties for mining sector
News broke this week that the Government was considering scrapping corporate tax for the mining sector in favor of a higher mineral royalty rate which is currently at 6 percent. The Government is said to consider mineral royalties simpler and more transparent to administer than corporate taxes. No indication of the new percentage were given.
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. * * *