Zambia projects strongest economic growth in four years

Business Insider

2 days ago

Zambia's economy is on track to grow by at least 6% this year, marking its strongest expansion since 2021, according to Finance Minister Situmbeko Musokotwane.
Zambia's economy is expected to grow by at least 6% in 2025, the strongest expansion since 2021, driven by increased copper production and improved rainfall.
Zambia has emerged from a lengthy debt restructuring process, aiding growth prospects and bolstering returns for creditors.
The Zambian kwacha has become Africa's second-best performing currency against the US dollar in 2025, aided by easing inflation and lower food prices.
Zambia's economy is on track to grow by at least 6% this year, marking its strongest expansion since 2021, according to Finance Minister Situmbeko Musokotwane.
He disclosed this on the sidelines of Bloomberg's annual Africa Business Media Innovators conference.
According to Musokotwane, the rebound is driven by improved rainfall and increased copper production. Musokotwane had mentioned earlier this year that the country is banking on its mining industry for an economic recovery.
Zambia, Africa's second-largest copper producer, experienced a significant increase in metal production last year, which accounts for more than 70% of the country's export earnings.
Next year Zambia hopes to increase copper production to around 1 million tons, and eventually, to 3 million tons.
"If all goes according to plan, 2025 should be the start of this revival and it will be getting stronger and stronger each year going forward," he said in January.
This economic upswing comes as Zambia emerges from a protracted debt restructuring process. The stronger growth outlook boosts prospects for higher returns to creditors, including bondholders.
Musokotwane is 'confident that we will get to that 6%,' he said. 'We just need to maintain this for 10, 15 years, positive growth every year. I think people will begin to see that it's not a certainty that you are born in poverty and you will end in poverty. Things can change.'
Currency strength and easing inflation offer relief
Notably, for the first time in a long time, Zambia's inflation rate is easing, offering the country some much-needed economic relief. At the same time, the kwacha has become Africa's second-best performing currency against the dollar in 2025, gaining 12% after a sharp rally last week.
The easing of inflation is largely driven by falling prices of essential food items such as bread and cereals, following improved rainfall that helped mitigate the impact of the country's drought.