Good morning. Here’s what you need to know
- Zambia Receives €23 Million in Direct Budget Support from France, Strengthening Bilateral Ties
- Government, ABSA sign agreement to enhance productivity in agriculture
- Kenya and European Union sign ‘historic’ trade deal
Interview of the Day
In this episode our host, Mwelwa Chibesakunda, gets to sit down with Mark O’Donnel who serves as Chairman of Union Gold Zambia. In this interview he shares insights gained from 40 years of entrepreneurial experience on how unlocking the private sector could lead to greater economic growth among many other topics. #GetToKnow
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In a significant development for Zambia’s economic growth, the Republic of Zambia has received direct budget support worth 23 million Euros from the French government. The financial injection aims to support various sectors of the Zambian economy, highlighting the deepened partnership between the two nations. The financial support was officially confirmed during a signing ceremony at State House, where the French Minister of State for Development, Francophonie, and International Partnerships, Chrysoula Zacharopoulou, paid a courtesy call on President Hakainde Hichilema. President Hichilema expressed gratitude for the bilateral and financial support from France, emphasizing its crucial role in Zambia’s economic growth. He underscored that the strengthened partnership is a testament to the confidence France has in Zambia’s new government. Read more: Lusaka Times
Zambia has experienced a notable upswing in the export of various plant and plant-based products to key trading partners, including China and the United Kingdom. Dr. Kenneth Msiska, the Director of Plant Quarantine and Phyto-sanitary Services, attributes this growth to the implementation of Enhanced Phyto-sanitary systems in the country. Dr. Msiska highlighted that the surge in plant product exports, encompassing commodities like soya beans and avocados, can be traced back to the effectiveness of the National Plant Protection Organization (NPPO) in Zambia. This organization has played a pivotal role in reducing and preventing the introduction of plant pests and diseases, fostering a conducive environment for increased trade in plants and plant-derived products. Read more: Lusaka Times
Metals recovery business Jubilee Metals has closed a private placement, raising around £13m ($16.6m) to support the recent copper waste rock dump project in Zambia. The company issued 236.3 million new shares in the placement, each priced at 5.5 pence. WH Ireland and Berenberg were joint brokers and joint bookrunners for the placement. The announcement follows the recent partnership between Jubilee Metals and United Arab Emirates (UAE)-based International Resources Holding (IRH) for copper extraction, with a monthly production goal of 2,000 tonnes. Early estimates indicate that the waste rock deposit could hold up to 350 million tonnes of material with copper grades higher than 1.5%. Read more: Mining Technology
Government has announced that the Agriculture Credit Window under the Sustainable Agriculture Financing (SAF) programme is now operational. Ministry of Agriculture Permanent Secretary, Green Mbozi, stated that this followed the signing of an agreement between government and ABSA Bank. Mbozi announced this during the signing of the agreement between the Ministry and ABSA Bank in Lusaka on Monday. He said the main objective of the initiative was to enhance production and productivity of maize to 10 million metric tonnes and one million metric tonnes of wheat by 2027. “The Agreement demonstrates a collective commitments to uplifting our small medium farmers and advancing the Agriculture sector,” Mbozi stated. He emphasized that the partnership signified a pivotal step towards ensuring that the vital contributors to the economy received the necessary support and resources to thrive. Read more: Zambia Monitor
Bank of Zambia Exchange Rates
Currency | Buying | Selling |
---|---|---|
USD | 24.9153 | 24.9644 |
GBP | 31.5402 | 31.6125 |
EUR | 27.1900 | 27.2537 |
ZAR | 1.3437 | 1.3468 |
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Kenya and the European Union on Monday signed a long-negotiated trade agreement to increase the flow of goods between the two markets, as Brussels pursues stronger economic ties with Africa. The Economic Partnership Agreement will give Kenya duty-free and quota-free access to the EU, its biggest export market, while European goods will receive progressive tariff reductions. The agreement is the first broad trade deal between the EU and an African nation since 2016 and follows a spending spree by China on lavish infrastructure projects across the continent. “Although today represents a moment of monumental promise, it is also the beginning of a historic partnership for historic transformation,” Kenyan President William Ruto said at a ceremony attended by European Commission chief Ursula von der Leyen in Kenya’s capital Nairobi. “The core of this arrangement is to put real money into the pockets of ordinary people,” said Ruto. EU chief von der Leyen said the partnership was a “win-win situation on both sides” and called on other East African nations to join the pact, which came after years of negotiations that concluded in June. Read more: Africa News
Rwanda expects a 6.6% growth in its economy in 2024, a slight increase from the current year’s 6.2%, as communicated to the International Monetary Fund by the finance minister and central bank governor. Earlier predictions by Finance Minister Uzziel Ndagijimana in February had estimated a growth rate of around 7.5% for the years 2024 and 2025. Rwanda experienced a robust economic growth of 8.2% in the year 2022, Reuters reported. Rwanda’s economy had a strong start in 2023, with GDP growing by 9.2% year-on-year in the first quarter. According to the World Bank, Rwanda, alongside Kenya, and Côte d’Ivoire, are the fastest-growing African economies in 2023, with their strong economic performance attributed to sound macroeconomic policies, investments in infrastructure and human capital, and a diversified economic base. “We foresee a temporary softening of economic growth, driven by needed tighter fiscal and monetary policies,” Ndagijimana and Central Bank Governor John Rwangombwa said in the Nov. 29 letter, made public late on Monday. “On the demand side, private consumption and investment are expected to be the main growth drivers in the medium term as fiscal consolidation ensues.” In November, the Central Bank of Rwanda maintained its key lending rate at 7.5%, citing an expectation of inflation decreasing toward its target range of 2% to 8% by the end of the year. Read more: Business Insider
Four African countries have been selected by the World Bank to test a program that is expected to help at least 100 million people in Sub-Saharan Africa by 2030. The pilot for the Clean Energy program would be carried out in Somalia, Tanzania, Rwanda, and Sao Tome and Principe. According to The East African, a news platform focused on news in East Africa, over the following seven years, the “Accelerating Sustainable and Clean Energy Access Transformation (Ascent) program” will be expanded to 20 nations in the area. Ajay Banga, President of the World Bank Group, revealed the $15 billion project in Zanzibar during the International Development Association’s (IDA) mid-term review conference of its 20th financing round. “We know it won’t solve the problem of access to power for the entire continent since there are more than 600 million Africans facing the problem. But we see it as a start and also a platform to draw more interest among IDA partners to also join the cause through similar investments,” the World Bank president relayed. Read more: Business Insider
Japan’s central bank left its ultra-loose monetary policy unchanged at its final meeting this year, a move that unraveled the recent yen rally as the Bank of Japan chose to wait for more concrete signs of meaningful wage growth. The BOJ decided unanimously to keep interest rates at -0.1%, while sticking to its yield curve control policy that keeps the upper limit for 10-year Japanese government bond yield at 1% as a reference, according to a policy statement released Tuesday. “Uncertainty over the outlook is extremely high and we have yet to foresee inflation sustainably and stably achieve our target. As such, it’s hard to show now with high degree of certainty how we can exit [from ultra-loose policy],” BOJ Governor Kazuo Ueda said Tuesday afternoon at a press conference, according to a Reuters translation. “If we were to exit negative rate, interest rates will rise slightly. But inflation-adjusted real borrowing costs will remain low, so accommodative monetary conditions will be sustained,” he added. Yields for the 10-year Japanese government bond fell to 0.622%, and the yen weakened after the BOJ decision, and was trading more than 1% lower at 144.33 against the greenback in the late afternoon. The Nikkei 225 stock index climbed 1.4% to its highest closing level in nearly two weeks. Read more: CNBC
For investors who braved their ‘bonds are back’ call in a turbulent year, euro zone debt was the big winner and a souring economy with tighter purse strings mean its allure will continue in 2024. The euro zone government bond market, worth roughly $10-trillion, is set to return 6.5% this year, leading a rebound from two years of negative global bond returns as inflation soared. The market has sharply outperformed U.S. Treasuries, up 3.5% this year, and UK gilts, up 2.4%, according to ICE BofA indexes. Italian bonds, at the epicentre of worries around the impact of record-paced interest rate hikes, returned nearly 9%. For some, that’s just the beginning. “We are now taking most of our really big bullish bond views via Europe, because that’s where the growth picture is really so weak,” said Mike Riddell, senior portfolio manager at Allianz Global Investors, who has shifted out of the United States and Canada into Europe. Read more: Reuters
Investors turned more bullish in December, buying stocks and reducing cash holdings on expectations the U.S. Federal Reserve has finished hiking rates and the global economy will avoid a big recession, a BofA fund manager survey showed on Tuesday. Investors are at their most overweight equities relative to cash since January 2022, according to the survey of 219 participants with $611 billion of assets under management. They are still overweight cash, but at their least overweight since April 2021, and their most overweight on equities since February 2022, the survey showed. A rally in world equity and government bond markets gained momentum last week after dovish comments from Fed chief Jerome Powell fuelled expectations for interest rate cuts in 2024. Wall Street continued to build on seven straight weeks of gains, the benchmark S&P 500 index’s longest weekly winning streak since 2017. Read more: Reuters
Finally, Capital Markets News
In 36 trades recorded yesterday 4,795 shares were transacted resulting in a turnover of K28,402.07. A share price loss of K0.02 was recorded in CEC Zambia. Trading activity was also recorded in Airtel, Standard Chartered Bank Limited, ZCCM, ZAFFICO and Zambeef. The LuSE All Share Index (LASI) closed at 10,830.66 points, 0.07% lower than its previous close of 10,838.13 points. The market closed on a capitalization of K88,721,922,484.87 including Shoprite Holdings and K53,939,237,044.86 excluding Shoprite Holdings.
Picture of the Day
ProBASE Limited has broken international financial barriers following its inclusion as the latest certified integrator for the Transactions Cleared on an Immediate Basis (TCIB) payment platform, which is expected to revolutionise the Fintech industry in the Southern African Development Community (SADC) region.
The certification entails an intervention and solution designed to seamlessly facilitate international cross-border trade to reduce exchange rate losses, lower the cost of doing business, improve efficiency in payments and improve financial inclusion in the region.