Zambia has successfully issued the second Sovereign Bond to the tune of US$1billion which comes on the heels of the initial $750 million which was rolled out in 2012.
The move is an indication of high levels of confidence the international community has in the Zambian Government and the country’s economy which has recorded positive macro-economic performance.
This successful issuance of the Euro Bond is as a result of hard work which has been exhibited through the continued stable political environment.
In addition, the measure has also convinced the donor community on the direction of the country’s economy.
Taking into account the country’s Gross Domestic Product (GDP) which is set to grow at not less than 7.2 per cent per annum, Zambia now has all it takes to grow the economy further through various capital investments using Euro Bond proceeds.
The funds factored in the 2014 National Budget, are a milestone in as far as the development of the Zambian economy is concerned and will add more value to the country’s economic build up.
The inaugural $750 million Euro Bond has since set the pace for massive infrastructure overhaul in various sectors of the economy such as roads and communication, railway, energy, agriculture and tourism.
These resources from the international capital market will definitely assist to accelerate the Government’s development agenda whose impact is now gaining some great momentum.
The efficacy of the Zambian Government’s development agenda is demonstrated in the imaging mining ventures in new frontier areas as well as corporate agriculture.
The Euro Bond is essential for Zambia’s economic future and will help to enhance the country’s capacity and quality of infrastructure and competitiveness.
This will also improve accessibility of agro products, goods and services to and from markets, as the Government gets ready to embark on the establishment of industrial clusters in all provincial centres of the country.
Apart from that, economic activities to be derived from the proceeds of the Euro Bond will bring along with it, countless opportunities for investments which will eventually create thousands of jobs for Zambians.
But while all the funds are in place, it will be important to ensure that the proceeds are targeted only at growth-prompting projects in various critical areas of the economy which can bring tremendous
It will be important to lend the money to sectors that have the capacity to pay back.
If the money is not properly utilised, the country risks running into a debt trap that will be difficult to dis-engage as the debt portfolio has already reached $5 billion.
There is also the need to ensure that Government and stakeholders apply maximum fiscal discipline in the management of funds so that it benefits the people of Zambia and not just a few selfish and corrupt individuals.