Thursday, June 20, 2024

Zambia preparing a fresh US$ 2 billion Eurobond

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Finance Minister Alexander Chikwanda addressing accountants during the ZICA annual ball dinner at Zambezi Sun Hotel in Livingstone
Finance Minister Alexander Chikwanda

Zambia is preparing to launch a new Eurobond of up to $2 billion before the end of the year in an attempt to close the financing gap.

The Zambian government has raised $1.75 billion in two separate Euro bonds since 2012.
Finance Minister Alexander Chikwanda said Zambia will return to the international capital market for fresh borrowing following the widened budget deficit in the first six months of the year which has risen to K 20 billion accounting for 18.5 percent of the GDP.

Mr Chikwanda told Journalists in Lusaka Wednesday afternoon that Zambia is definitely issuing a third Eurobond in four years but refused to confirm that the country will seek to borrow as much as $ 2 billion.

‘We don’t do things in the dark. This is a government and we will tell you when we are ready to launch the Eurobond. Let us not get ahead of ourselves. For now just know that we are exploring all possible borrowing options externally because we don’t what to continue borrowing domestically for fear of crowding out the private sector,’ Mr Chikwanda.

But senior officials at the Ministry of Finance have confirmed that Government will seek to borrow up to US$ 2 billion to plug the budget deficit.

The officials who sought to remain anonymous revealed that they will embark on a road show next month in the USA and the UK to market the Zambian sovereign bond.

On Tuesday, Mr Chikwanda told Parliament that he will seek its approval to increase in the ceiling in external borrowing to 60 billion kwacha from 35 billion kwacha.

37 COMMENTS

  1. Lately…..
    We seem to exist on an economic diet high in ‘bonds’ US or otherwise.

    Really words fail me…….! I am soooo shaking my head right now!

    But before the opposition start braying….what would you do different really? Our economy needs rejuvenating!

    The developments will be really lovely once they are completed……’tis’ a comforting thought……

    • 1. The wastage in this government is clear to see, it needs to be plugged asap.
      2. The developments may “look lovely” but will they generate revenue at a rate that justifies these bonds? Studium in Mongu and other white elephants come to mind.

      #ABC borrowing money since 1970.

    • 1. The wastage in this government is clear to see, it needs to be plugged asap.
      2. The developments may “look lovely” but will they generate revenue at a rate that justifies these bonds? Studium in Mongu and other white elephants come to mind.

      ABC, borrowing money since 1970 but never their when its payback time.

    • Copper prices at 5700 and projected to be low for the next 5 years..

      In short you are F…..ked

      Wish you good luck while i enjoy a good Germany beer

      Wir werden sehen Sie auf CNN hungern …. das Gute daran ist, dass ein hungriger Wähler ist eine kluge Wähler

    • Henceforth this government qualify to be called the Kaloba Government. Ministerial vehicles should carry a label on the door written ” Purchased on Euro Bond”.

      It is a sad situation.

    • And then you have ignorant musicians like Dandy Crazy, Dambisa and the convicted felon General Kanene blindly singing songs of praise to Edgar Lungu.

      These are people who have no clue the extent of the damage the PF is causing the economy.

    • The book runners were in London last week to test the waters and the initial indications are that there is little appetite for fresh Zambia risk. The investors are not convinced that the country’s economic parameters are heading in the right direction. PF want to use borrowed money to meet the next scheduled repayment. Indications are that we shall default on our payments. Now we see desperate moves such as NAPSA (parastatal) buying shares in ZCCM-IH (parastatal). Pensioner’s money has gone to GRZ.

  2. i will punch the next *****t shouting pabwato around me. This has been one hell of a rocky ride these monkeys have taken us on. Tribalists pieces of Shiite. They want to say other people are tribal when they would rather vote for a cockroach than have people who can steer this country in the right direction.

  3. Awe this is too much, remember that it’s our future generations that’ll suffer from whatever decision we make today.

  4. I have told u in the past and i m saying it again. There is no where we r going. How does a govt borrow so much within 4 years? Chikwanda is a pumpkin who just sits there passing gas all he thinks is borrow more and more. I expected this deficit because how do u increase salaries for ZNS, Army, Zaf, and others by as much as 200%? How do u expect to cover that cost? Was it worthwhile to pay those buggers that kind of money? Either chikwanda is doing it deliberately or he doesnt care what happens to zambia since he has already………

  5. We need the Billions of Dollars that are in our Mines to pay for these projects. Sadly, we are only asking our economic partners for thousands of Dollars.

  6. Bank of Zambia Governor is golden. The Dinosaur that is our minister of Finance, goodness. Can we employ Nawakwi President supreme and Mangande to this valuable position? We are not doing ourselves, that is all Zambians, Christians, other Zambians, kaponyas and misfits. Press the president to put an intelligent wise person in the ministery of finance. We cannot have crazy people in such a powerful position.

    Viva president Nawakwi.

  7. Before we borrow again can we audit the other bonds which we got.Where has the money from subsidy gone.Catholic church has proved to an agent of devil.
    When Mwanawasa was in goverment every week you used to write pastoral letters but when the economy has gone to the worst you are mute.Shame as we await for more hardship

  8. The rate at which this government is borrowing is really scarely now. Before we know Zambia will be sold soon.

  9. Debt biotherapy- the new hard drug of choice for Zambian govt and its addiction to this destructive drug is growing.

    It induces fake satisfaction for failures and side effects are indebted kids,fitch downgrades ,debt acidosis and growth aneamia.

  10. PF’s flea circus -poor zambians used as collateral sure for loan contractuals! Where’s the monies going mwebantu-amidst wage freeze,subsidies removal & non payments of contractors as well as non funding to grant aided institutions! We need these morons under Jameson to be audited by an independent international audit corrupt free company to ascertain the prudence utilisation of earlier contracted loans!

  11. Abane ABC. do not furnish the good name to register accerated growth with inverse returns it will furnish your good works so far

    The revision in growth rate is enough and it follows that certain expenditures be smoothened and scaled down to have that sustained growth

    Ifwamabondi. was a wind in sovereign finance that many countries most repositioning away jumped on and never realized any real economic grow muched with that realized growth in the national.

    So far you have said the truth in humility we can endure slap and make sure we reinvestment with a proper IRR from so far invested

    Sovereign makerts in bonds have no permanent friends smiling when yields are favorable wishing always for the yield curve like that

    Fyakale many countries have realized no benefit as…

  12. Preserve you name and in humility scale down on projects priotise and the same 2billion dollars can be seen on internal current accounts if you look nicely

    Each additional issue will be at increased yields no so subscribed making even the credit rating on already quiet onourous

    Let’s continue the good works done so far and tell the truth about the numbers as you did in parliament on look also not only on the top line but the bottom line as well and restructure renegotiate certain cash flows

    When you look at your revised growth forecast assuming that is the income registered on national accounts we may need above 39 yrs to realize the revenues or double the borrowed to ensure comfort but then depreciation and maintenance will be on call let’s do a scenario longterm and…

  13. Chimbwi no plan! Ifikopo mwavotele ifyaishibafye ukukongola. Aba ba Chikwanda bakote, bakafwa nokushenkongole. Awe kwena we will pay for employing this stupid government with its drunk President called Chagwa. I miss LPM. Our country gone to the Dogs.

  14. Then there are other methods of financing to explore better than the sovereigns with little time and excess liquidity

    The exposure on bonds in terms risks and returns as a component of debt portfolio will also not be to international standards and especially that Zambia ranks in that quandrant quadrantal

    We call not do all let’s accept and scale down and sustain its impressive already

  15. Zambia is badly lagging with how it is economically engaging with its ‘citizens’ in the diaspora. A lot of Zambians abroad are sitting on a lot of cash that could be invested back home in Zambia. It has been estimated that Zambians in the diaspora have as much as £500 million of disposable income, much of which could be invested in Zambia on all kinds of infrastructure projects that would help the country in its endeavour to move forward. Nearly everyone I know has been stung by trying to use family or friends to invest in Zambia. What is needed now is for the Government to facilitate the management of the investments. The Government should introduce conducive conditions that would encourage us to invest. Besides the remittances we make to families do already help with the forex reserves.

  16. A Lungu anabwera kuchoka ku Chawama & he has taken borrowed bond money to Millpark clinic while UTH and other hospitals are bleeding to death. You can’t live on borrowing. Chikwanda brought misery on Zambians then through his borrowing and he is doing the same now. Why can’t we learn from Botswana? Zambia is in trouble with PF visionless leadership

    • Yea!!! you are right…blame yourselves and your voting patterns. You look at regions and not the intelligence, acumen, and viability of the candidates. Shame on you Zambians.

  17. Do African leaders follow what is happening in the world? Just this morning i was hearing the news on Greece and how chocked their economy is and i guese this will be the same if not worse for Zambia. Surely, are there no better ways of developing a country other than through borrowing? Why cant some projects such as roads be differed to a time when the country would have raised enough revenue. This recklessness in spending will cause self recolonisation for this poor country! Watch this space

  18. We have already abrogated the previous bond s terms why borrow more.Parliament should refuse unless they want to prove how impotent they are

  19. We want to kongola big this time ($2 billion); use $500m on Sata’s/MMD projects; share $1 billion; use $250m for govt operations and $250m for bribing voters next year. If voted out next year; we disappear from the political scene with a ka $1 billion for our children as your children pay back the debt through their big and hard noses for many years to come.

  20. ndeloleshafye..2016..HH chabe,. make no mistake bane.. you can see for yourselves that a lot of damage has been done.. therefore, there is no room for mistake.. its pa kuboko..pakwanja, pa chikasa, pakuboko, pa kwanja chabeeeeeee. tell your neighbour

  21. useful *****s…hahahahahahhahahaahahahhahahahaahahahaah awe mwee. nyeko nakasushi..pwiiiii. akukongoleni guys,.. beshibe ubupuba twakwata.

  22. Balance the books by cutting expenditure ,increase revenue base in Taxes use of ZRA Using a combination of the two will yield more favourable and sustainable to chip away from debt You will need to look at long-Term debt crisis taking course correction
    This whole charade is unsustainable and is going to end in disaster. We are using credit to rollover and pay off maturing debt keeping our kwacha over valued also.
    Its good the minister has been faithfully honestly to give the figures as they are

    A private Public mix will also held to tackle the Debt conundrum

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