The year 2019 was a very tough year for Africa’s red metal producer Zambia characterized by economic turbulence. Zambia grapples with rising debt exacerbated by infrastructure spending and an energy crisis that has heightened inflation risks while simultaneously suppressing growth to under 2%. With very few credit lines available to draw from to fund projects, the Zambian government has looked to the domestic money markets to raise cash to meet its fiscal programs. The central bank had a total of 26 treasury bill sales with K950 million worth of assets on offer (per auction) of which only 8 were fully…
Author: The Editor
When the Economics Association of Zambia proposed that Zambia aligns it’s vision 2030 to the electric car era, many did not think the need was as urgent as yesterday. The Future of Economic Diplomacy – Sustainable Development for Zambia and Africa theme was expounded at a two (2) day summit in Livingstone the tourist capital. Suggested positioning opportunities were from a copper supply perspective as an average electric car uses about 80kilos of red metal in cables while the lithium battery has significant portions of manganese and cobalt to facilitate power storage. It explains why the Democratic Republic of Congo…
The Industrial Development Corporation has commenced a restructure of Zambia’s state owned newspaper printing company the Times Printpak Zambia Ltd. In a press statement released on the IDCs website on 28 December, Times Printpak Zambia board has been dissolved with immediate effect and business operations will be overseen by Daily Mail Board until such a time that a new board is commissioned. Further cited in the release was the company’s weak financial performance and under water return on assets for a long time as one of the key drivers of the dissolution and restructure. The company has struggled to meet…
Erasing what was a good start to the week, when the copper currency, the Kwacha rallied, to highs last seen on Oct.10 in thin trade as miners sold dollars to meet month end perks, the Kwacha has erased the pre x-mas profits booked as energy funding need resurface. As though 26 December not being a holiday in Zambia, the energy regulator boxed consumers with a brace of energy tariff hikes in fuel and electricity. The last Friday of 2019 recorded the worst bond performance of the year raising only K57.7million in cash terms of the K1.1billion on offer. Appetite was…
Well ahead of Christmas Day the copper currency rallied an impressive 2.5% to close trading at 12.97/13.15 for a unit of dollar. Post Christmas into Boxing Day on 26 December, in addition to the energy regulator the Energy Regulation Board (ERB) boxing Zambian consumers with a brace of energy hikes in fuel and electricity prices, the Kwacha crept weaker to 13.85/13.95 levels as dollar demand for energy funding resurfaced in the market. Read also: Detented dollar demand and conversions for miners perks in ‘thin trade’ support copper currency bulls “The market is generally short dollars as petroleum dealers prepare for…
The energy regulator in Africa’s red metal producer on 26 December approved a tariff hike application by the power utility ZESCO to hike electricity pricing by an average of 106% effective January 2020. This was contained in a press release by the regulator signed by the board chairman Raymond Mpundu. The hiked tariffs are to be used to improved operations at the power utility that grapples with negative jaws and should also cushion energy imports in the energy crisis era. Zambia’s energy utility company charges one of the lowest tariffs in Southern Africa which has made energy investments very unattractive.…
Justified by crude price bulls and Kwacha currency bears, the energy regulator in Africa’s red metal hostspot on 26 December resolved to hike pump prices of fuel by an average of 10% effective midnight, this was confirmed by the Energy Regulation Board (ERB) Chairman Raymond Mpundu. Petrol will now sell for K17.62 from K15.98 per liter as diesel climbs 9.55% to K15.59 a liter while kerosene pricing ebbed higher 18% to K15.39 a liter. Read also: Crude ‘bulls’ and Kwacha ‘bears’ could trigger a fuel hike Crude markets continue on a bullish streak supported by OPEC+ member states commitment to…
Africa’s second largest copper producer, Zambia has stepped up its bullion oversight in a quest to shore up the nations falling strategic reserves. Grappling with falling foreign exchange reserves to a decade low of $1.4 billion, exposing the copper producing economy to stress shocks, the need to use gold as a buffer has increased to help improve the nations weak import cover as the yellow metal is globally acceptable store of value as safe haven due to its immunity to market volatilities. In a statement by Mining Investment Vehicle ZCCM-IH Chief Executive Officer Mabvuto Chipata, it was established that a…
November currency ‘bear’ effects were priced into the December headline inflation accelerating it to 11.7%, 90bps wider from previous month. The latest numbers were provided by Zambia Statistics Agency (ZSA) in Lusaka the capital and do reveal a rising consumer price index as the copper producer grapples with drought autopsy effects of extended load management and rising food prices in a volatile currency environment. Energy deficit still wide. Power bottleneck currently stands at 871MW having narrowed from 890MW in October after MCL is now firing 135MW into the grid. A scanty rainfall pattern thus far has raised worries about another…
With little dollar appetite for energy and agriculture funding which have been the biggest drivers of market appetite, dollar conversions by miners to meet monthend perks have extended Kwacha bulls into Christmas eve. Opening at 13.25/13.45 on the interbank on 24 December, the Kwacha rallied to close at 12.95/13.15. A volatile African currency so far. The Kwacha has been very volatile in the year sliding to record lows of 15.75 for a unit of green back to bullish streaks pushing the red metal currency to 12.45. With falling reserves to decade lows in anemic import cover of under 1.6 months.…