STANDARDS and Poors (S&P) global ratings has revised and upgraded Zambia’s sovereign rating from negative to positive, with a stable outlook.
According to a statement issued by Ministry of Finance Spokesperson Chileshe Kandeta, Finance Minister said the (S&P) global ratings have revised Zambia’s outlook on the ‘B’ long -term foreign and local currency sovereign ratings to stable, from negative.
Mutati said the ‘B’ long-term and ‘B’ short-term sovereigns have also been affirmed at the same time.
“This development rides on the basis of the critical reforms which we have embarked on as a country under the Economic Stabilisation and Growth Programme to implement fiscal consolidation, remove subsidies, reform the energy sector, and embark of diversification of the economy through agriculture development and industrialisation,” Mutati said.
Mutati said according to the report on Zambia issued by S&P Global last Friday 25th August, 2017, government’s fiscal financing position appears more assured, with domestic liquidity conditions continuing to improve.
“S&P Global has also observed in the report that the country’s economic growth prospects are improving, as a result of which, they said, they were revising their “outlook on Zambia to stable from negative and affirming the ratings at ‘B/B’,” Mutati said.
Mutati said the the report further stated that Zambia’s stable outlook, balances an improving macroeconomic picture against a number of negative rating pressures, including a still large fiscal deficit and substantial debt stock.
“They cautioned that the rating could be lowered if the government materially deviated from its fiscal consolidation target,” Mutati said.
“S&P Global noted that, “should Zambia’s external imbalances reduce materially faster than expected in tandem with faster growth than they currently expect, which could raise their GDP per capita trend growth forecast, “upward momentum on the ratings UPWARD could imemerge.
He said government through his Ministry has assigned a stable outlook to reflect a number of more positive developments which they expect will continue to reduce pressure on Zambia’s fiscal, economic, and external assessment.