• The Current Fitch rating upgrade to Zambia is a very welcome move.
• It is going to promote investor confidence into the economy in terms of investments when it comes to FDIs.
• When it comes to financial sustainability, it’s going to give confidence even to government.
An Economist says the current Fitch rating to Zambia will promote investor confidence in terms of Foreign Direct Investments (FDIs).
Mambo Phiri told Money FM News in an interview that this will also give confidence to government in implementing measures put in place to manage the country’s debt levels.
Mr. Phiri greatly welcomed the move, and commended both government and the Fitch for ensuring that there is transparency in the way they facilitate all the engagements.
He however urged government to continue on the same trajectory of seeing to it that the country’s debt is managed sustainably as this is key in achieving economic growth.
“The current Fitch rating upgrade to Zambia is a very welcome move because it is going to promote investor confidence into our economy in terms of investments when it comes to FDIs. And when it comes to financial sustainability, it’s going to give confidence even to government to ensure that the measures that they have implemented in ensuring that they bring all financial liabilities into financial health.”
“Indeed it’s a welcome move and we commend both government and the Fitch for the wonderful works they have done in ensuring that there is transparency in the way they facilitate all these engagements,” Mr. Phiri said.
Meanwhile, Mr. Phiri advised stakeholders s involved in Zambia’s engagements with the International Monetary Fund (IMF) to look at positive outcomes of some of the measures that government has put in place in ensuring that all the debt levels have been controlled so as to reduce the debt burden in the long term.
“We would also want to advise various stakeholders involved in some of these engagements such as the IMF that they can also look at the positive outcomes of some of the measures that government has put in place in ensuring that all the debt levels that have been amassed in Zambia have been contained so that in the long term we are going to reduce our debt strain,” he added.
Recently, Fitch Ratings upgraded Zambia’s Long-term Local-Currency (LTLC) Issuer Default Rating (IDR) to ‘CCC’ from ‘CC’ and affirmed Zambia’s Long-Term Foreign-Currency (LTFC) IDR at ‘RD’.
The upgrade reflects that the government has continued to service its local currency debt and has made no indication that it plans to include domestic debt in any potential debt restructuring.