Hichilema Re-election Gives Investors Continuity, But They Want Growth - CNBC Africa

Zambian President Hakainde Hichilema's re-election hands investors the policy continuity they sought, while negotiations on a new International Monetary Fund programme provide an early test of whether a second term can turn economic stabilisation into sustained growth. The copper producer is emerging from years of economic turmoil after becoming the first African sovereign to default during the COVID-19 pandemic in 2020. Hichilema's first term was dominated by a lengthy debt restructuring and IMF-backed reforms. "For investors, Hichilema offers continuity," said Stuart Culverhouse, chief economist at Tellimer. "The challenge now will be to build on gains in macroeconomic stability, lower inflation and fiscal discipline while accelerating growth and investment." Zambia aims to secure a new IMF programme by year-end after its previous $1.7 billion arrangement expired in January. Finance Minister Situmbeko Musokotwane said fresh investment was needed to drive growth and create jobs. Africa's second-largest copper producer is targeting annual output of 3 million metric tons, nearly triple current levels, as it seeks to capitalise on rising demand for the metal in electric vehicles and renewable energy. However, analysts warned that El Nino weather risks could disrupt hydropower and copper production, as happened previously when drought hit electricity output and caused rolling blackouts. Zambia's 2033 dollar bond was bid at 97.72 cents on the dollar, broadly unchanged despite the election result, suggesting markets had already priced in a Hichilema victory.