ZAMBIA has successfully been issued the targeted amount of US$1.25 billion Eurobond for infrastructure development.
The Eurobond, with a coupon rate of 8.97 per cent, has an 11-year average life with repayments scheduled for 2025 to 2027.
This is contained in a statement issued by first secretary for press and public relations at the permanent mission of Zambia to the UN Chibabula Silwamba.
The issuance is in line with prudent debt management practices of the country that will ensure a sustainable debt redemption profile.
“The bond issuance, which is in excess of two times oversubscribed, demonstrates investor confidence in the economic governance of the country,” Finance Deputy Minister Christopher Mvunga, who led the Zambian delegation, said.
Mr Mvunga said the success demonstrates confidence that the international financial community has in the leadership of President Lungu.
“As the case has been in the past, the funds will be used in infrastructure-related projects in the area of road, energy, education, health, water and transport sectors in order to better the lives of the Zambian people,” Mr. Mvunga said.
The Minister emphasised that Government would strictly adhere to the programmed use of the resources.
“The fiscal consolidation measures outlined to the investors in the presentations will strictly be adhered to,” he said.
Mr Mvunga said this was an opportune time for Zambia to issue bonds given the anticipated rising interest cost in the international markets in future.
“Despite a challenging capital markets environment arising from global economic uncertainties, Zambia’s bond issue was met with high demand from international investors allowing the country to lock in a competitive interest rate,” he said.
The Zambian delegation met over 60 fund managers during the five-day road show in the United Kingdom and the United States of America.
Mr Mvunga committed that going forward, Zambia would conduct annual investor meetings to ensure transparent communication of the performance of the economy.
Zambia Daily Mail