Zambia’s GDP grows 6pc-Mutati

Fri, 29 Sep 2017 13:58:36 +0000

By AARON CHIYANZO

ZAMBIA’S Gross Domestic Product (GDP) has grown by 6 percent in the last 10 years, and this has tremendously contributed to economic progress over the years, Minister of Finance Felix Mutati has said.

Mr Mutati said Zambia had over the years made tremendous economic progress with GDP growth rate averaging 5-6 percent in the last 10 years.

He said in a statement that the growth in the economy had led to the reclassification of Zambia as a lower middle income country, which had redefined the financing landscape for Government.

Mr Mutati explained that the reclassification of Zambia as a lower middle income country had limited the access to concessional external financing from traditional bilateral and multilateral creditors.

He said that the development had led to increased opportunities for Zambia to access financing from previously unavailable sources such as the international capital market at non concessional terms.

“Concessional financing relates to financing at World Bank (IDA) comparable terms while non-concessional financing relates to financing at market terms,

“This is evidenced by the successful issuance of three Eurobonds in 2012, 2014 and 2015 amounting to US$750.0 million, US$1.0 billion and US$1.25 billion, respectively,” said Mr Mutati.

Mr Mutati said that the increased access to various sources of financing had introduced new costs and risks to the debt portfolio which needed to be prudently managed in order to ensure sustainability of public debt.

He said the newly introduced Debt Management Strategy, was a plan that Government intended to implement over the medium term to achieve a desired composition of the Government debt portfolio which captured Government’s preferences with regard to the cost-risk trade-off.