Good afternoon. Here’s what you need to know
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Moody’s upgrades Zambia’s long-term rating
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Afreximbank reports 74.2% rise in gross revenue, as 2023 figures hit $2.6 billion
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Access Bank to establish Caribbean presence
In Local Business and Finance News
Moody’s has upgraded Zambia’s long-term issuer rating on foreign currency to ‘Caa2’ from ‘Ca’ and similarly upgraded the local currency rating to ‘Caa2’ from ‘Caa3′. This upgrade follows the successful restructuring of Zambia’s eurobond, with a bond exchange completed on June 10 on the London Stock Exchange. Fitch also upgraded the new bonds’ short-term issuer rating to ‘CCC+’ from ‘RD’ while maintaining the sovereign’s long-term issuer rating at ‘RD’. These rating upgrades have boosted market sentiment, potentially attracting more capital flows into Zambia, which could further support the Kwacha’s strength. The upgrades signal a more favorable environment for capital pricing and could mark the beginning of a more stable financial era for Zambia. The Business Telegraph
Both of Zambia’s newly-restructured government bonds are to be included in J.P. Morgan’s widely-followed emerging market debt indexes the bank said on Friday. Zambia recently completed a restructuring of its defaulted U.S. dollar-denominated sovereign debt, issuing two new bonds with two different structures with a total notional value of just over $3 billion dollars. “Based on the latest available information, both of the newly issued bonds satisfy Index eligibility criteria, in-line with Index rules and methodology,” J.P. Morgan said, adding that removal of the country’s existing bonds and addition of the new ones would be reflected on June 28. As-of June 13, Zambia had a weight of 0.31% and 0.18% in the EMBI Global Diversified and the EMBI Global indexes respectively. Read more: Zawya
President Hakainde Hichilema has congratulated the Zambian owned company Trade Kings for winning the African Business Leadership award, as Africa’s leading company. In a Facebook write up, President Hichilema said the award underscored the importance of determination and hard work, coupled with a good political environment where business could thrive. “A very big congratulations to Zambian owned company Trade Kings for scooping the African Businesses Leadership award as Africa’s leading company. This underscores the importance of determination and hard work, coupled with a good political environment, where business can thrive. This is what we are working to achieve so that our private sector players may continue to succeed and grow internationally. Congratulations Trade Kings, indeed ‘Boom! And the dirty is gone.” Read more: News Diggers
About K200, 000 financing has been reportedly made available by the Standard Chartered Bank Zambia to support the growth and advancement of Small and Medium-sized Enterprises (SMEs) in the country. The support had been done through the hosting of the SME Capacity Building Workshop held in Solwezi this week. This collaborative effort, according to the bank, underscores its dedication to fostering sustainable development opportunities and impactful initiatives within the SME ecosystem. Standard Chartered Bank Head of Corporate and Investment Banking, Emmy Kumwenda, underscored the pivotal role played by SMEs in the country’s economic growth. “I hope SMEs utilise and put the knowledge they will gain to good use. We want to see more SMEs in Zambia adding value to their products and making it to our shelves both locally and internationally,” Kumwenda said. Read more: Zambia Monitor
In International News
The African Export-Import Bank (Afreximbank) has reported robust growth despite economic challenges, registering US$2.6 billion in gross revenue for the year ended 31 December 2023. This marks a 74.2 percent increase from US$1.5 billion in 2022. Benedict Oramah, President and Chairman of the Board of Directors of Afreximbank, made the announcement in Nassau, Bahamas, on Thursday. Speaking at the 31st edition of the Afreximbank Annual General Meeting (AAM) and the Africaribbean Trade and Investment Forum 2024, Oramah highlighted that net income rose by 66.07 percent to US$756.1 million, up from US$455.3 million the previous year. Oramah noted that Group entities, including the Fund for Export Development in Africa (FEDA) and Afreximbank Insurance Management Company (Afrexinsure), contributed modestly to revenue growth and profits. He further stated that the bank had disbursed US$18 billion representing 8.7 percent rise. Held under the theme, “Owning Our Destiny: Economic Prosperity on the Platform of Global Africa,” the event emphasized significant financing support for projects like the Dangote Refinery, which has received US$2.6 billion from Afreximbank. Read more: Zambia Monitor
Access Holding PLC, one of Africa’s largest banks, has announced plans to establish a branch in the Caribbean island, aiming to deepen trade links between Africa and the Caribbean. Aigboje Aig-Imoukhuede, Chairman of Access Holding PLC, outlined the roadmap for Access Bank’s expansion into the Caribbean banking sector. He noted the challenges faced by Caribbean people in accessing financial services, highlighting the difficulty of opening bank accounts on the island. Aig-Imoukhuede emphasized the need for an indigenous or local bank that understands the financial needs of the Caribbean people. These revelations were made during a discussion on opportunities for global investment for economic growth and diversification into Caribbean at the African Export-Import Bank (Afreximbank) Annual Meetings. Read more: Zambia Monitor
The World Bank has approved a $2.25 billion loan for Nigeria to shore up revenue and support economic reforms that have contributed to the worst cost-of-living crisis in the country. The bank said in a statement late Thursday that the bulk of the $1.5 billion loan will help protect millions who have faced growing poverty since a year ago when President Bola Tinubu came to power and took drastic steps to fix the country’s ailing economy. The remaining $750 million, the bank said, will support tax reforms and revenue and safeguard oil revenues threatened with limited production caused by chronic theft. President Tinubu’s economic reforms — including ending decadeslong but costly fuel subsidies and unifying the multiple exchange rates — have resulted in surging inflation that is at a 28-year high. Read more: Africa News
The G7 summit opened Thursday (Jun. 13) in Italy. A session focused on investments and infrastructures projects in Africa. The Partnership for Global Infrastructure and Investment (PGI) program was high on the agenda. Projects include a rail corridor that will connect southern and central Africa. The project will also bring telecommunication cables and other infrastructure to the region. The infrastructure investments are meant to serve as an alternative to China’s development efforts, which the U.S. and its allies seek to contain. Canada, Germany and EU, as well as representatives from Italian and American private companies such as ENI and Microsoft that are participating in the investment program. The president of the European Commission hailed a “different” program. “We wanted to create an alternative, an alternative for this infrastructure investment and it is not only the financial firepower that is impressive but PGI (Partnership for Global Infrastructure and Investment) is sustainable, it’s good for the planet, but it’s also good for the countries’ finances if I may say so. This combination makes our offer different to others. Important is that we want to bring long-lasting benefits to the local economy of our partners.” Read more: Africa News
The Nasdaq eked out a fifth straight record closing high on Friday following gains in Adobe and other technology-related shares, while the S&P 500 and Dow ended slightly lower. The S&P 500 ended its four-day run of record closing highs, but still climbed more than 1% for the week. The S&P 500 technology sector rose 0.5%, hitting another record high close. The communication services sector rose 0.6%, leading gains among sectors. Adobe shares jumped 14.5% a day after the company raised its annual revenue forecast on more demand for its artificial intelligence-powered software. Read more: Reuters
Finally, Capital Markets News
In 133 trades recorded on Friday, 89,876 shares were transacted resulting in a turnover of K818,130.60. The following price changes were recorded Friday: K0.03 gain in Zambeef and K0.28 gain in ZAFFICO. Trading activity was also recorded in Airtel, CEC Zambia, Real Estate Investments Zambia, Shoprite, Zambia Breweries, ZANACO, Zambia Sugar, and CEC Africa on the quoted tier. The LuSE All Share Index (LASI) closed at 13,205.46 points, 0.20% higher than its previous close of 13,178.48 points. The market closed on a capitalization of K101,780,861,417.76 including Shoprite Holdings and K66,998,175,977.76 excluding Shoprite Holdings.
1 Govt Bond trade with a face value of K1,000,000 and turnover K638,300 was processed Friday.