The southern African country’s Lusaka Stock Exchange All Share Index may climb to 3,200 at the end of 2010, up from 2,794.89 at the end of 2009, after gaining 12 percent in 2009, the Moscow-based brokerage wrote in a research report today. Zambian shares trade at 9.8 times estimated earnings, Rencap said, compared with 12.95 times for the MSCI Emerging Markets Index, according to Bloomberg data.
“Economic growth is likely to remain strong in 2010, at about 6.3 percent,” according to the note. “We expect earnings for 2010 to surprise on the upside as corporates recover from the low base in 2009.”
The Zambian kwacha may appreciate to about 4,000 to the dollar by yearend as “foreign direct and portfolio inflows improve and copper prices remain elevated,” the analysts wrote. The currency was 4,725 against the dollar at 12:33 p.m. in Lusaka, according to Bloomberg data.
The kwacha lost 26 percent of its value against the dollar between April 7 and December 24, 2008, as copper prices declined from $8,730 per ton to $2,845 per ton amid the global financial crisis. It was the ninth-worst performance against the dollar of 170 currencies tracked by Bloomberg. Copper accounts for about 10 percent of gross domestic product of Zambia, a landlocked country of 13 million people, and 70 percent of export earnings, according to Standard Bank Group Ltd.
Market Value
The metal used in wiring more than doubled to $7,375 per ton at the end of 2009 from $3,070 per metric ton a year earlier, and is up 1 percent so far in 2010.
The market value of stocks traded in Zambia was worth $5.3 billion at the end of 2009, according to RenCap. Among African countries, the Lusaka exchange ranks behind that of Botswana, the world’s biggest diamond producer with a population of 2 million, and Ghana, the world’s second-largest cocoa producer, in market value, and is bigger than Malawi’s bourse, according to Bloomberg data.
Zambia is likely to have had gross domestic product growth of 6 percent in 2009, compared with about 2 percent for sub- Saharan Africa, according to RenCap.
Best Performers
There is a 60 percent chance that the Lusaka index will reach 3,200 at the end of this year, assuming copper prices remain above $7,000 per metric ton, RenCap said.
A better-than-expected global recovery may drive commodity prices higher and take the index to 3,350, a possibility to which RenCap assigns a 30 percent chance.
The best performing stocks last year were Farmers House Ltd., a Zambian property investor, Zain Zambia, the nation’s biggest mobile-phone operator, and Zambia National Commercial Bank Plc, RenCap said.
[ March 23 (Bloomberg) ]
Ya Ya ya we will wait and see if the value of Kwacha will ever improve. People have reall suffered with high prices of things and can not make ends meet even for simple meals in a day. I am hopeful that this prediction will come to pass.
Ok,this is hillarious,the last month has seen RB travel to china,Malawi and Namibia,floods,Incinerators not working at hospitals,all this has had some form of impact on the govnt,so to counteract all the negative reports we’ve been reading,someone has to go watch bloomberg and come up with drivel,how many times have we heard boz governor with thees types of statistics
It is good to atleast read some good news about home, especially as this was reported in bloomberg!! The challenge is how to translate this growth in the economy into tangible “fruit” on the ground. How to provide the essentials to those who don’t have i.e. in the townships and in the villages. How to ensure that the common man has an opportunity to provide for his family w/out resorting to corruption for instance. The opposition should be at the forefront of challenging the govt and the general citizenry on alternative paths the nation can take to prosper our land and not concentrate on spewing hate and innuendo. Let a generation of leaders with integrity, creativity,industry,clarity and selflessness rise in Zambia.
ECZ is neither a branch of the UPND nor does it work on their irrational, uncultural and insensitive terms of the UPND failed leadership. ECZ works within legally and morally time frame that espouses human sensitivity.Hon. Maboshe just died yesterday and the constitution gives time to the ECZ to come up with a bye election within reasonable time.Why the rash? Since the death of Hon.Chisanga reasonable time has passed like wise Maboshe’s constituency its moral reasoning but within reasonable time.due to lack of wisdom no wonder Ichilema is in the business of insulting traditional leaders with impunity.He is uncultured black sheep than a moralist
“Definitely it’s not acceptable! I mean we serve one man and we must have total allegiance. So if there are such ministers, deputy ministers or NEC members, they are not doing the right thing,” Kaingu said. “You know what? Even a dog has got allegiance to its owner. So we must have total allegiance to the President. We must give him as much support as we can, just as a dog gives support to its master”
if he asks us to jump,we dont ask why,we ask how high,thats what loyalty to a president should be” said Hon Kaingu
and as a Senior Citizen i support this,these are the type of leaders we need,not PF kaponyas who insult their leaders
wait and see, more is coming for Zed in development. RB Viva! Kaunda was a Teacher, he gave us freedom and infrastructure, Chiluba Socialist, he have liberisation & housing, Mwanawasa Lawyer, consolidated knowlege in Corruption and more prisoners of the vice, RB Business man, industrial development, more kwacha ahead coming and wht of Sata (Ex prisoner), (Ex Constable) wht do u expect from Sata sure……… lies!God have mercy on PF and the mions.[-(
Senior Citizen 4-5, what are you going on about?! Have you read the subject of the blog you’re posting under? Economists have long argued about the measures and indicators of economic development and economic growth. The statistics in the report, if they can be relied upon seem to imply that the Zambian economy as a whole may experience growth. What these indicators will not disclose for instance is how equitably will this growth in GDP/income be distributed among the population in Zambia. For this you will require more indicative but more complex indicator such the Gini Coefficient that measures the inequality of income. ‘The Pie may be getting bigger but some are getting even bigger portions than before’. The rich get richer, while the poor get poorer, hence no reduction in poverty.
First grow the economy, then decide how to share. When the cake becomes bigger the investors (the people who oil the economy) and the rich will get richer but so will the poorer get more (or become richer in relative terms). That is how economies grow and people progress. But first things first: GROW THE ECONOMY AND NOT JUST SPENDING PRECIOUS TIME YAPPING POLITICS AND INSULTING EACH OTHER AND OUR LEADERS.
The time to enjoy a strong kwacha is back again. poeple used to change cars like clothes build houses like it dint cost money-in 2006-2007. All it requires now is for government to completely eliminate corruption if possible,continue building on reserves, continue infrastructure development in health, education,judiciary home affairs etc, trust me if you do what is right you do not need to fear your own shadow, viva development viva strong kwacha. (GOD WITH US)
A strong Kwacha is a good thing for Zambia. The factors of production in Zambia are heavily import-related and with a strong kwacha we expect low cost of production to translate into reduced food and commodity prices on our domestic consumer market.This, I believe, will play down inflation rates to even favour single digits. Again we should take advantage of the inflows of FX and diversify our economy. Copper alone as we saw previously will not sustain us levelly. What more all the revenue from copper is banked offshore. We need revenue in our banks by altenative local business ventures through diversification.
Sounds just about alright to me if this is an accurate projection. Why point fingers at global economic trends? If the economic outlook of this country is set for a turnaround, chances are that co-operating partners and multinationals will opt for consistency with the current government. You can’t argue with the facts. Shape up or ship out.
Thats not a realistic projection whatever the source of that data is,those are just assumptions that are so tied to the copper price which has stabilised for a few weeks now:-w:-w:-w:-w:-w:-w
We have always told you that the Zambia economy is moving forward and powering on all cylinders and that the economist is in charge and see how he steers this ship to great success, but some of you think we are just boot licking. Facts are facts and numbers don’t lie. Am glad this report came from Bloomberg and not the so called Government mouth piece. So are you going to accuse Bloomberg as an MMD bootlicking mouth piece? Numbers don’t lie and President Rupiah Banda has been doing well since he came into the office. continued Levy’s legacy of fiscal discipline and moved the country too a higher heights. All we can say is you aint seen nothing yet. The best is yet to come. You just watch and keep mourning like 90 years old GOGOs or MBUYAs stuck in the past of free things
The Kwacha gaining is one thing but real benefits trickling down to the ordinary muntu is what waits to be seen!
#14 Bra P
TAke it easy my friend. You can’t bee demanding thunder and not expecting to see lighting first. Thunder always come after lighting. All this news and the numbers you see and lighting, my friend and if we continue to move at the rate we are moving , then we should expect the thunder of Jobs and real more money in people’s pockets and not useless money Zimbabwe style which some parties would deliver for Zambia once put in statehouse. They will lie to you how lthunder comes before lightening, be watchful.
If the predictions turn out to be true then the opposition will have a hard time in dislodging the current regime in 2011 especially if it means that more revenue will allow the govt to put in some voter friendly policies in the next budget.
All this ishappening because of RB’s good governance. Let us all support the big man
The above report is accurate and no wonder Zambia has popped up on the radar as a favourable investment destination amongst emerging markets.Anybody within the circles of for example US institutional investors,will realise why these guys are looking for stable and steady Zambians that they can work with to tap into such investment potential.It`s time to capitalise and make enormous gains.
Good report. Nice to hear such good news about our country. Give credit where it is due. Now lets have some mineral windfall tax back.
# 15, how long are we gonna be waiting to see the lightning. THe MMD have been in power for almost 20 years now and i’d like to believe that if indeed they were performing, some form of eal improvements should have at least started showing by now. Indeed numbers dont lie. My profession tells me so cause i my job involves numbers. However, talking about improvement of the economy means nothing if you and me can not see simple effects like the stabilisation of the price of chibwabwa. Think hard about this and you ll realise that thats the reason you and i are not in Zed right now. Shame aint it?
This is a very good development and I’m very happy to hear it from an international sorce. Given this favourable situation, our government should work even harder to ensure that the Zambian Kwacha remains strong and these achievements are not fleeting. A strong currency is the only way to ensure that we can maintain the growth of our economy in future.