• Kwacha will remain under pressure in the first quarter despite mine investments that are coming through.
• This is because production may not take effect immediately.
• Zambia remains in a default state making it unattractive to foreign investment, hence the Kwacha will remains under pressure.

An Economist says the Kwacha will remain under pressure in the first quarter of 2024 despite mine investments that are coming through especially in the case of Mopani Copper Mine.
Speaking in an interview with Money FM News, Emmanuel Zulu said this is because production may not take effect immediately, therefore the country might get to see positive change in the second half of the year.
Mr. Zulu noted that the other factor that is still holding investments from coming into the country is the protracted debt restructuring deal, which if concluded, will ease the pressure and see investors being attracted to the Zambian economy.
“So with the frameworks that have been put in place, at least we should see a bit more of resilience and also with the investments that have come on board, the production may not take effect immediately, we might get to see change probably in the second half of the year.”
“I think the first quarter will still be challenging despite the announcements of the investments that are coming through especially in the case of Mopani. We will still see a Kwacha that is under pressure,” Mr. Zulu stated.
He added that Zambia remains in a default state making it unattractive to foreign investment, hence the Kwacha will still remains under pressure in the first quarter and this is likely to continue because no major changes will happen especially with regards to output from the mining sector.
Mr. Zulu further reiterated that the major challenge affecting the performance of the Kwacha is less supply of foreign exchange (FOREX) on the interbank market against high demand for US dollars to facilitate imports.
“The issue about the Kwacha performance is tied to a number of factors, the major of them being that the country is a net importer where you have less supply of forex on the market owing to the fact that you are importing more than you are exporting. So the net export there is negative, so that is the biggest challenge.”
“We know that our major export commodity is copper so the levels of copper have been down and that requires that there has to be improvement in investment and also we see the output levels going up. Not only that but also the revenue that is gotten from copper exports also remaining in the country, forex earnings at least a considerable proportion,” he said.
The local currency has opened the market trading at K26.34 and K26.85 after closing Monday’s trading session at K26.29 and K26.80 on the bid and offer respectively.