Standard Bank calls for improved energy investment in Zambia

Zambia, a country rich in mineral resources, is facing significant challenges in its economy due to factors like El Nino-induced drought and load shedding. The Bank of Zambia is expected to raise its policy rate by 100 basis points to combat high inflation, which stood at 15.4% in July. Helen Lubamba, Head of Corporate and Investment Banking at Stanbic Bank Zambia, highlighted the opportunities and challenges facing the country. Despite the hurdles, Zambia remains an attractive investment destination with stable politics, investor-friendly policies, and an abundance of natural resources. One of Zambia's key attractions is its copper industry, crucial for the global transition to low-carbon economies. However, economic headwinds like power cuts, drought, and debt challenges have raised concerns about the timeline for realizing returns on investments. Addressing the debt situation is underway, with agreements expected by the end of the year. The mining sector shows promise with successful exploration efforts and policy reforms to attract investors. The energy sector poses a critical challenge for Zambia, exacerbated by increased demand and inadequate investment. Load shedding has reached unprecedented levels, impacting businesses and daily life. Efforts are underway to improve the energy infrastructure, including public-private partnerships and diversification away from hydroelectric power. Timely investments in energy infrastructure are crucial to support economic growth and the mining industry. In conclusion, while Zambia faces hurdles in its energy sector, the country's investment climate remains favorable. Timely investments in key sectors like energy and mining are essential for sustainable economic growth and to harness the potential of Zambia's abundant natural resources and youthful population.