Zambia Economic Forecast

Zambia Economic Outlook

November 17, 2020

After the economy slipped into a technical recession in Q2 as the pandemic’s fallout battered the trade and construction sectors, available figures hint at a slow recovery so far. The external sector, in particular, seems to have staged a strong comeback as soaring shipments of copper—which accounts for the lion’s share of the country’s exports—combined with rallying prices for the commodity due to upbeat demand from China, translated into a massive increase in export revenues in August–September. Domestically, the private sector PMI continued to crawl higher, hitting a near two-year high in October, albeit still pointing to a deterioration in business conditions. Meanwhile, in late October, S&P Global Ratings cut the country’s credit rating from CCC- to selective default, after the government missed an interest payment and announced the suspension of debt service to external creditors. The country is headed to become the region’s first pandemic-era sovereign defaulter.

Zambia Economic Growth

Although the economy is poised to contract at the sharpest pace since the mid-1990s this year, it is seen bouncing back to growth in 2021, albeit remaining subdued by historical standards. Significant downside risks prevail, including uncertainty over the pace of the global economic recovery and the government’s massive foreign-currency-denominated debt burden. FocusEconomics panelists see GDP growing 1.6% in 2021, which is down 0.3 percentage from last month’s forecast, and 2.6% in 2022.

Zambia Economy Data

2015 2016 2017 2018 2019
Population (million)16.216.717.217.818.3
GDP per capita (USD)1,5081,2931,5661,608-  
GDP (USD bn)24.521.627.028.6-  
Economic Growth (GDP, annual variation in %)  
Industrial Production (annual variation in %)  
Fiscal Balance (% of GDP)-9.5-6.1-7.7-8.3-  
Public Debt (% of GDP)62.360.761.978.1-  
Money (annual variation in %)
Inflation Rate (CPI, annual variation in %, eop)
Inflation Rate (CPI, annual variation in %)
Exchange Rate (vs USD)11.009.9310.0111.9414.09
Policy Interest Rate (%)15.5015.5010.259.7511.50
Exchange Rate (vs USD, aop)8.6610.319.5410.4812.92
Current Account (% of GDP)-2.3-3.2-1.6-1.2-  
Current Account Balance (USD bn)-0.6-0.7-0.4-0.30.2
Trade Balance (USD billion)
Exports (USD billion)
Imports (USD billion)
Exports (annual variation in %)-28.0-
Imports (annual variation in %)-16.0-12.515.217.4-23.7
International Reserves (USD)

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Zambia Facts

Value Change Date
Bond Yield33.000.0 %Dec 31
Exchange Rate14.090.0 %Jan 01
Stock Market0.30.0 %Jan 06

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