Moody’s upgrades Zambia

• Caa1 rating reflects progress in debt restructuring, fiscal consolidation – Govt

CHOMBA MUSIKA

Lusaka

GOVERNMENT says Moody’s Ratings’ upgrade of the country’s sovereign credit rating from Caa2 to Caa1 is another step in the country’s recovery from the debt distress that culminated in its 2020 default.

The Ministry of Finance and National Planning said the upgrade, announced on October 30 this year, reflected sustained improvements in Zambia’s debt trajectory following the debt distress that culminated in the country’s 2020 default.

In a statement issued by Office of Secretary to Treasury, the ministry said the development demonstrated progress in debt restructuring, fiscal consolidation and macro-economic stabilisation, while strengthening Zambia’s international credit standing.

The rating action follows a staff-level agreement reached with International Monetary Fund (IMF) on October 9, 2026 for a proposed 36-month Extended Credit Facility arrangement worth US$1.472 billion.

The ministry said the proposed facility was intended to safeguard macro-economic stability, strengthen debt sustainability and support inclusive, private sector-led economic growth, although it remained subject to approval by IMF Executive Board.

Government said the positive outlook reflected encouraging prospects for further economic improvement, anchored on sustained fiscal and economic reforms.

It added that 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.

The ministry further said the development presented opportunities for increased productive investment, infrastructure development, export growth, job creation and improved household incomes under Grow Zambia Agenda.

It noted that the rating upgrade had come at an important time as Finance and National Planning Minister Situmbeko Musokotwane prepares to present the 2027 National Budget on Friday.

Government said the forthcoming national budget would focus on consolidating economic stabilisation gains while strengthening the foundations for increased production, investment, employment and household incomes.

Under President Hakainde Hichilema’s Grow Zambia Agenda, the ministry said Government’s priority is to translate improved economic stability and international confidence into tangible benefits for citizens through increased productivity, private-sector participation, export diversification and value addition. https://enews.daily-mail.co.zm/welcome/home