Zambia’s external debt hits $14.7 billion, as copper production increases by 6.2%

Zambia’s external debt portfolio has risen, while copper production increased by 6.2 percent to 346,747 tonnes, according to the latest economic review by the Ministry of Finance and National Planning.

Permanent Secretary for Economic Management and Finance, Danies Chisenda, reported during the Second National Development Coordinating Committee Meeting of 2024 that external debt increased to $14.7 billion from $14.6 billion at the end of December 2023.

Chisenda attributed this increase to disbursements mainly from multilateral creditors.

“Of the projected US$914 million in external loans for the year, US$158.5 million has been disbursed. Guaranteed external debt stands at $1.39 billion, down from $1.41 billion at the end of December 2023,” Chisenda stated.

The reduction is due to partial debt service payments made by some guaranteed institutions.

Chisenda acknowledged a significant downgrade in domestic real GDP growth to 2.3 percent from 4.7 percent, primarily due to drought impacting the agriculture and energy sectors.

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The report also highlighted a decrease in electricity generation by 14.1 percent to 8.1 million megawatt hours (MWh) in the first half of 2024, compared to 9.5 million MWh in the same period of 2023.

Maize production is forecasted to drop by 54.5 percent to 1.5 million tonnes in the 2023/2024 farming season, down from 3.3 million tonnes in the previous season.

“Positive growth is projected in key sectors such as mining, transport and logistics, tourism, manufacturing, and Information Communication Technology (ICT),”Chisenda noted.

Other major economic shifts included a 3.06 percent reduction in the stock of government securities, from K232.62 billion in December 2023 to K225.50 billion in June 2024.

Bonds accounted for 84.9 percent of the stock at K191.56 billion, while Treasury bills accounted for 15.1 percent at K33.94 billion.

The government is prioritizing the clearance of arrears to boost economic activity, focusing on local institutions.

The report also mentioned revised arrears dismantling strategy to address past implementation weaknesses and expedite the clearance of some arrear categories.

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