ZAMBIA SUCCESSFULLY FLOATS 1.0 MLN USD BOND

LUSAKA, June 9– Zambia has successfully issued a second sovereign bond in the international capital market amounting to 1.0 billion US dollars.

Acting Finance Minister Edgar Lungu says THAT like the first sovereign bond issue the country made in September 2012, the second bond has been a resounding success and was over-subscribed.

He said in a statement here Sunday that this was an expression and affirmation of the confidence the international investor community hads in Zambia.

Lungu added that the bond proceeds would be targeted at growth–prompting projects in the various critical sectors of the economy, namely the transport and energy sectors.

A team from the Ministry of Finance, the Bank of Zambia and Ministry of Justice had, over the past two weeks, worked exceedingly hard to rally international investors behind the second sovereign bond, he said.

Meanwhile, the World Bank has warned that the Zambian economy is likely to be affected if demand for copper by China remains weak because Zambia largely depends on copper as its main traditional export and China currently accounts for 45 per cent of total copper demand.

The World Bank’s Chief Economist for Africa, Francisco Ferreira, called on the Zambian government to increase investments in rural areas as a means of closing the gap between development in rural and urban areas.

Ferreira said infrastructure development such as huge airports in the cities were meaningless if real Africans in rural areas had no access to development. The government should invest more in roads to open up smallholder farmers to markets, he added.

Ferreira also noted that currency depreciation in countries like Zambia had led to pressure on prices of goods.
However, the bank has projected economic growth for sub-Saharan Africa to be at 5.2 per cent in 2014 from last year’s 4.7 per cent and Ferreira attributed this to rising investments in natural resources and infrastructure, and strong household spending.

SOURCE: ZNBC

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