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Alba Iulia
Friday, September 10, 2021

Kwacha appreciation due to increase in copper prices-Sinkamba

Headlines Kwacha appreciation due to increase in copper prices-Sinkamba

Green Party leader, Peter Sinkamba says the accumulation of enough dollars in the reserves has pushed down the demand for the US dollar, hence the appreciation of the Kwacha.

Mr Sinkamba has attributed the Kwacha’s recent speed appreciation to the boom in copper price which is now trading at US $9,700.85 per ton on the international market as well as the rise in the mineral loyalty tax.

Mr Sinkamba said in an interview that contrary to Economist, Chibamba Kanyama’s remarks that the major reason the Kwacha is appreciating, apart from the copper revenue, is that Zambia is not servicing any external dollar dominated debts at the moment and this has seen the reserves being heaped with dollars.

Mr Kanyama is quoted in some sections of the media stating that, currently it is hard to state or know whether the current appreciation of the Kwacha will last or not because it is not based on fundamentals but on defaulting on debt repayments.

But Mr Sinkamba in reiteration has argued that there has been no single country, institution or individual creditor that has raised any concern on Zambia defaulting on its debt, adding that the appreciation of the Kwacha is based on real fundamentals.

“We have seen the accumulation of more dollars in the reserves because Copper prices have continued rising on the international market. This coupled with the increase in the production of the red metal and the increase in the mineral loyalty tax has seen our reserves injecting more dollars, hence the appreciation of the Kwacha,” Mr Sinkamba said.

The Green Party president said the rising of the ‘sliding scale’ of the mineral loyalty tax to almost 10 percent, twice more than what mining firms were paying to government has also allowed the accumulation of more dollars in the reserves.

He said this has deteriorated the demand for the US dollar, thus allowing the Kwacha to gain over five percentage points in the last 14 days against other major convertible currencies.

The Kwacha was by close of business trading in the range of K18 in some bureau de change and K19 at commercial banks across the country.

12 COMMENTS

  1. It’s the same taxation policy, same government, same BOZ governor. But the Kwacha is recently rated the best performing currency in the world. Only envious people would think things must wait for the better until they become leaders of government.

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  2. Mopani was saved from closure. KCM was rescued from wanton mismanagement. Our foresight is making us reap from our copper. Thanks for saving miners’ jobs too and paying them their benefits. Mopani is preparing for their packages too.

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  3. Whose advice should take when it comes to my personal finance decisions? my weed dealer or my accountant????? kikiki

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  4. True value of us dollar will be known after the
    Elections.If we can maintain this rate for next three months then we will accept as Mr
    Sinkamba is saying otherwise it’s not real.

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  5. LIES LIES LIES
    AFTER THE ELECTION THAT IS WHEN JUDGEMENT IS COMING
    NOT THE FALSE ECONOMY THE PF IS PREACHING

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  6. We should note that we are saving dollars by not importing electricity and more fuel to run generators because pf and ECL have added more than 1350 MW. Big job. We are not import maize instead we exporting Maize. It means, we saving dollars and earning more dollars. VOTE ECL FOR A BETTER TOMORROW>

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  7. Just yapping, no substance in this man as usual. His PF friends have lamentably failed, economy is in quagmire. MMD left a fairly decent economy, then came PF, even before covid came the economy was already on a down ward spiral. So what copper pricing is he talking about

  8. Now look at this other joke. Somebody saying vote ECL for a better tomorrow, but simple logic is, if the man has failed now, going by the negative economic indicators, how can he perform in the future, can you be serious for once, we are talking about peoples livelyhoods here

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  9. And thus we must attribute the depreciation to the 2014 global commodities bust that saw oil drop from $100/barrel to $20/barrel and copper from $8,500/ton to $4,500/ton not that upnd gibberish about economic mismanagement. I’ll give ECL credit for steering us through these crises from 2015-commodities bust, power crisis, drought, covid-19 but still delivered major infrastructure and the mines (KCM, Mopani, Zambia Gold). And I know who can take us to greater heights and will vote for him on August 12. Vote wisely, Zambians.

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