Zambia gets fresh credit rating upgrade

By BUUMBA CHIMBULU MOODY’S Ratings has upgraded Zambia’s sovereign credit rating from Caa2 to Caa1, citing sustained improvements in the country’s debt position following its 2020 default. The rating agency has also maintained a positive outlook, signalling the possibility of further improvements if Government sustains its fiscal and economic reforms. The upgrade comes weeks after the country reached a staff-level agreement with the International Monetary Fund (IMF) on October 9 for a proposed 36-month Extended Credit Facility programme worth US$1.472 billion. The proposed IMF programme, which is subject to approval by the Fund’s Executive Board, is intended to safeguard macroeconomic stability, strengthen debt sustainability and support inclusive, private sector-led growth. Commenting on the development the Ministry of Finance and National Planning in a statement said the upgrade announced on October 30, 2026, reflected substantial and sustained improvement in the country’s government debt trajectory. “The development followed progress in debt restructuring, fiscal consolidation and macroeconomic stabilisation, which had helped restore the country’s international credit standing,” the ministry said. According to the ministry, the improved credit rating could strengthen investor confidence, potentially lower borrowing costs for Government and businesses, attract foreign direct investment and support exchange-rate stability. It said the positive outlook was an encouraging assessment of the country’s prospects for further improvement, provided the country maintained its reform programme. The ministry added that the improved credit standing could create opportunities for increased investment in infrastructure, export growth, job creation and improved household incomes under the Grow Zambia Agenda. The development comes ahead of the presentation of the 2027 national budget by Finance and National Planning Minister Situmbeko Musokotwane in Parliament this Friday. “The forthcoming budget would seek to consolidate the gains made in economic stabilisation while strengthening the foundations for increased production, investment and employment,” the ministry said. It said Government remained committed to fiscal discipline, prudent debt management and policies aimed at increasing productivity, diversifying exports and promoting value addition across key sectors. The ministry, however, noted that improved credit ratings should not be treated as an end in themselves, but as an opportunity to attract productive investment, strengthen public finances and improve the living standards of ordinary Zambians.

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