The Bank of Zambia (BoZ) has said that the Gross International Reserves rose to 1.4 billion dollars equivalent to 2.6 months of import cover at the end of June from 1.2 billion at the end of March.
In a Monetary statement released to the media, BoZ said that reserves rose to 2.9 billion dollars equivalent to 5.4 months import cover after the receipt of the 1.3 billion dollar IMF Special Drawing Rights at the end of August.
The Central Bank Chief revealed that demand for government bonds surged with the subscription rate rising to 162.2-percent from 66.3-percent in the first quarter.
He attributed the move to mostly high yield rates and improved investor sentiments following the credit rating upgrading by Fitch in April which further attracted nonresident investors who accounted for about 70-percent of bonds demanded.
Meanwhile, BoZ Monetary Policy Committee has maintained the Monetary Policy Rate at 8.5 percent.
BoZ Governor Christopher Mvunga said that the decision was arrived at because of a favorable exchange rate and improved prospects for fiscal consolidation.
Mr. Mvunga says the committee remained mindful of the subdued economic activity and existing vulnerabilities in the financial system.
Mr. Mvunga added that BoZ has however prioritized dismantling of domestic arrears, enhanced revenue collection, securing an IMF programme, and achieving a sustainable budget balance.
And Mr. Mvunga said Zambia’s economy is this year projected to grow by 1.6-percent and strengthen over the medium term.
He said this is on the backdrop of the expected positive performance of sectors like ICT, electricity, public administration, and education.
Mr. Mvungu has projected inflation to decelerate faster than was earlier anticipated although it will remain above 6 to 8-percent from the current average of 22 point 6-percent.
He said the projection follows receding of some dominant risks, appreciation of the Kwacha, positive sentiments on Zambia’s economy, and prospects of securing an IMF program earlier than previously anticipated among others.
Mr Mvunga said that the depreciation rate of the Kwacha against the US dollar reduced further to 3.6 percent to an average rate of K22.41 in the second quarter compared to 4.4 percent in the first quarter following an improvement in the supply of foreign exchange, mostly from foreign portfolio investors and mining companies.
On a net basis, foreign financial institutions increased their foreign exchange sales in the market to US$452.3.million from US$13.2 million. In a similar vein, the mining companies supplied a total of US$573.3 million, of which US$374.9 million was directly remitted to the Bank of Zambia as tax payments.
To moderate exchange rate pressures, the Bank of Zambia sold US$35 8.2 million compared to US$259.7 million in the previous quarter.
Recently the Kwacha has appreciated sharply mainly due to significant inflows from non-resident investors in Government bonds and improved market sentiments. Between July 1 and August 31, 2021, the Kwacha strengthened by 29.6 percent to K 15.94 per US dollar.
And BoZ Deputy Governor Administration Francis Chipimo said the financial sector has since early this year recorder a rise in demand for cash.
Dr. Chipimo however allayed social media reports that the central bank is fighting withdrawals of funds.
Thank you for giving us the truth and not peddling lies like the upnd president did in claiming that we had no reserves. Very disgusting especially coming from someone who claims to be an economist.
Only 1.4 billion when they found 3 billion ?
Busy paying caders, enriching themselves and dishing out free money…….no plan
They need to be held to account….
The more HH delay to fire these people the more they’ll hurt him. Politics is not Church. He shouldn’t confuse the two.
Thank you Gov. Do these figures include the gold reserves we started putting aside? We need to add emeralds and copper to that reserve tank. So the governor is confirming what we already know that we DON’T NEED ABENA IMF for now, maybe later when we grow wings. Things are hotting up and I think God is on our side this time round.
FUSEKE ZULU
YOU HAVENT A CLUE WHAT YOU TALKING ABOUT
GO POST ON COMEDY CENTRAL CAUSE YOUR POSTS ARE LAUGHABLE
YOU A LOSER ACCEPT THAT AND MOVE ON
Please differentiate…these are reserves and not funds available for consumption. The government coffers are still very empty because this amount is less than our debt (liabilities). Therefore…we still do not have money.
When is this chap leaving ?
Last briefing on monetary policy by Mvunga. Next time there will be a different face.
Is USD3bn the same as nothing in the presidents mind? Politics are over; time to work, and work hard.
We know Mvunga is already fired since government change over, but he is stating a fact.
The catch here is the priotising of paying domestic arrears as he is putting it, obviously pressure from his outgoing friends in government to be paid as they were the main suppliers but using fronts
When is Kaizar Zulu going to be arrested? There must be something that they can charge him with.
KZ go and drink with that id1ot was boss of urs who distroyed our country u peaces of sh1t should be hunted down like the d0gs that you are
Against debt of $ 14 BILLION.
@Mulongoti Machayi
You need to understamd what reserves means. This is not money for immediate use. Its money which a government/person puts aside for use in emergency circumstances. Time of war, femine, etc and not for consumption. Reserves are normally 3 months for you to meet your monthly bills. So when HH says the is no money, the is simply no money because the reserves can not be used for consumption
Remember the actual reserves were $1.6bn before the IMF gave Zambia the $1.3bn from the coronavirus fund because in there wise move PF was using the reserves for consumption.
There is NOTHNG to be happy about, to all those are think Zambia is okay, you have “reserves of 2.9 billion dollars after the receipt of the 1.3 billion dollar IMF Special Drawing Rights at the end of August”. The question is how much does Zambia owe externally = 12billion and Internally = 15billion.
Some how can you sit comfortably and say we are fine, when the reserve is NOT sufficient?
And HH said the reserves were empty….so he wanted to sit on 2.9 billion dollars…..hahahaha caught red handed….i told you guys HH is a big crook…..and can someone get him to explain why he said the reserves were empty….this is a serious matter and he can be impeached….he was attempting to steal 2.9 billion dollars
Mvunga will soon be fired…HH has been caught red handed together with Musokotwane….now you know why he picked Musokotwane….and why he is decaying to pick his Cabinet ministers….he wants ” yes boss” ministers…just look at the choice of his Press Aide…typical cadre..no educational background…no Journalism back ground….maybe HH will send him to school for free
Some people kwena, even if you put faeces in their nose, they will still claim they cant get the scent of smelly faeces. You have 20billion kongole, and you want to boast of savings/profits after your uncle donates some cash tofor you to buy food for your hungry kids.
HH is a businessman, and his evaluation of the GRZ coffers is guided in that way, only people like Ka.i.zar will be dancing just for them to feel better, after their worshipped lord wipped out all the reserves, because of the same thinking.
Again inocent comment, taken for moderation. Ba LT you, and your robots are not normal.
PF has been working
Does that include CK’s $30M bonds?
Why don’t we use some of these reserves to sort out water issues in the country, for example ever since the new government came in, we have had water supply issues in PHI in Lusaka, I suspect sabotage by the people belonging to the outgoing government, because why is Lusaka water not issuing any communication or apology
@ The Engineer
When someone says there’s no money..and yet there’s 2.9 billion dollars….what is that suppose to mean…stop coming up with your own assumptions and trying to defend HH….you guys never used to defend Lungu…but as for HH…even if he says something wrong or lies about something…remember HH told people in Mkushi that he uses his own personal plane for campaign….and yet he doesn’t own one…HH is just a show off guy….is he still wearing white gloves….he probably doesn’t want his hands to get dirty when he greets his voters
Fire him over empty threats on Kambwili.
Michael jordan and ??? ok lets just pick an unkown NBA player from a team which is in a bottom half of the log if we combine their net worth , it will be in excess of what we have as our reserves. Ah can’t believe am seeing that ka amount, when did we start mining ? I heard tonnes we export every week brings in excess of 50million US. There has been mismanagement since the time of kaunda may his soul rest in peace
Good to see that the slumber at govt institutions appears over, suddenly our officials are making efforts to sound (and act) intelligently! I can’t remember the last time Mr Mvunga sounded this logical 🙂 However, on the 29.6% Kwacha appreciation, I believe he left out positive sentiments brought about by the new administration – which is certainly to a small contribution
@The Engineer. #14
Reserves are used in several different ways: to keep a fixed rate value; maintain reasonable priced exports; remain liquid in critical times; and provide financial markets confidence for investors.
Reserves pay external debts, provide capital to fund sectors of the economy, influence forex and profit from other sectors. Reserves could even be assets, eg. Kasenseli gold, etc.
The president mentions empty coffers to justify his continued borrowing from IMF who gave you a dyonko of USD 1.3bn to lure you further.
Mr HH said govt coffers are empty! Just seeing what is obtaining on the ground, this is of course true. Government is not able to pay, for example, its retirees, pay supplier(as alluded to by CK), external debt, road construction, airports and so forth. This is the truth.
Now, someone says Mvunga will be fired bcoz he contradicted his boss by saying we have $3billion in reserves – well, this level of ignorance is shocking to say the least.
Reserves are not meant for “operation capital” nor consumption petty cash. Guys lets leave national economic matters to people that understand it. PF was fired from GRZ due people who thought running govt was the same as running a car wash in Kabwata!
5.4 months import cover for a country like Zambia given our GDP debt ratio is pathetic, it stinks and I would not expect Nawakwi or Mvunga to know that technically we are swamped real big time!
pinkfong – HH should have fired this clown on day one these are the people advising crooks to externalise funds to offshore accounts….he should have fired him and let the Deputy Governor take over for the meantime…the more he waits the more the time these crooks cause damage like that Kingsley at ZRA he has taken all clearing businesses to his clearing companies. These morons know that they will be fired and they are busy destroying and shredding evidence and covering their tracks.
I wonder why hh doesn’t say the truth all the time. I wonder why you can’t take 1.3 billion dollar IMF Special Drawing Rights back from where it came from. This money is cursed.
Zambia is still very rich. Natural Resources ni mbwe mbwe mbwe look within, work hard, create own programs and generate revenue from our mines, agriculture and other resources to pay off all our debt. All we need is not a begging Government.
So some people can’t understand why hh said the coffer is empty so people likes to make issues wer things are right can’t u c that Zambia owes about 14 billion and u ar busy saying hh wants to hide the money wer can hh take the ka 2billion
IMF wishes to bulldoze and buy our Eurobond and the Chinese debt.
The Brenton Woods guys want to cash in on us. They dangled a live bait, we succumbed to it. We are in a remarkable debt swap.
Like really, why would IMF buy “our Eurobond”? An IMF loan is cheaper than Eurobond. In any case Eurobonds are traded on an open market, anyone with enough euros can buy them. They don’t to come to Zambia to buy them 🙂
Simple mathematics …3billion reservesagainst 14billion debt and you say you have money lol .
Education: The reason Zambia is going to IMF is because takongola too much, We can’t go ANYWHERE else to borrow money anymore. Everyone deems us to risky(you know who we have to thank for this??), When a country’s sovereign status good, you go to ‘open market’, u are evaluated and money is lent to you at an appropriate interest rate – rate that matches the country’s ability to pay back the kongolad loan.
That is the simple reason.
What do we need the money for? To increase our production capacity – buy ‘big’ tractors for agriculture, improve mining operations, build factories…etc. To reduce dollars spent on importing burger patties and potatoes from Joburg.
@illuminate #31
It’s a pity that the so called educated Zambians on LT are justfying having a begging government….like they like HH because he now has a bigger begging bowl than Lungu…and HH is well connected so it will be easy for him to get loans…like really???? Why can’t we just work hard as a country with what we have instead of running to our former colonial masters and asking for hand outs….so according to Spaka, Tarino and other LT keyboard warriors…it’s ok for HH to beg but it was not ok for Lungu to do the same…..
Michael Sata once said in Zambia the majority of educated Zambians are cowards….and it’s true….we like to do things the easy way…..why can’t we work hard like west Africans….we have enough resources but we like borrowing and free things….HH and his minions used to complain when Lungu was borrowing…..now they’re going begging with a much bigger begging bowl to the dreaded IMF….I used in Zimbabwe when the IMF forced them to introduce ESAP…Economical Structural Adjustment Program….and what happened to Zimbabwe after that….everything went south till today
When someone suddenly lends you 45% of your bank acc value do you go bragging for being bailed out? Zambia only had $1.4bn reserves and IMF bails you out you lie to yourselves that you’re ok?
IMF is a necessary evil. We need their money to build factories & increase our production. I’m glad we have HH at the top to manage all this with prudent oversight. If it was ECL he would have diverted that money in inflated road constructions kulyamo. Atleast for now we’re moving forward in the right direction. My hope HH involves alot of energetic youths in factories to increase this production ?
I was listening to international news and imagine Afghanistani has Ten Million Dollars ($10million) in foreign reserves, the country that has been at war for two decades and we in Zambia are celebrating $2.9Million reserves. We should be ashamed.
Don’t know about you but I did not think HH meant there was no ngwee when he said ” coffers were empty.”
It’s a figure of speech. When you nephew asks you for money and you respond ” I don’t have any money” do you mean there’s nothing in the bank, no savings and no money tied in capital assets?
Guys , go find a job to keep u busy if u completely have nothing to do. Or go to sit at bus stations the whole and watch watch how buses get in, load and depart – seeing that there will be no cadres to harass u anymore. Cos who ll argue that Zambia has no money, if u had money u wud ve paid even 1% of total Debt. Than completely default
Mulifiko bonse mwebalekana ati HH is cheating.
The bank governer says we
We have $2.9bn in reserves, but owe $13bn – BoZ
So ninshi muleyunfwa ati namukwata indalama? Mwalibelela kaloba.