BOZ CITES INFLATIONARY PRESSURE CONTRIBUTORS

The Bank of Zambia has cited the rising international oil prices, which are currently quoting above US$ 100 per barrel and the projected global grain deficit as some factors to affect inflationary pressure in Zambia.

Zambia has recorded a 6.6 % inflation rate for the month of September, which the central bank however says, does not significantly affect the year-end target of a 7 per cent inflation rate.

This comes against a recorded increased inflation rate of 6.6 % for the month of September, up from 6.4 % in August.

In its bulletin, the Central Statistical Office attributed the September increased inflation to rising prices of food commodities, such as the staple maize meal.

And the central bank’s Monetary Policy Committee has further forecast the October inflation rate around the September levels.

In a statement, the committee has further cited labour related cost-push factors and the rising feedstock prices, as local front factors to affect future inflation until year-end.

The bank has also attributed the Zambian economy’s poor external performance to the current debt crisis in the Euro-zone and slowed down global economic activity.

SABMiller INVESTS US$ 5 MILLION IN ZAMBIA OPERATIONS

Global brewing giant, SABMiller has invested a further US$ 5 million into its operations in Zambia.

The investment is in a new opaque beer packaging plant, for one of its subsidiary companies, National Breweries.

And Company Executive Director, David Carson says the plant, to be commissioned on 3^rd October 2012, will bring efficiency in the packaging of opaque beer.

Among some other Zambian companies, which the SABMiller group owns, is Zambian Zambian Breweries.

ZAMBIA RECEIPTS SOVEREIGN BOND PROCEEDS

The Zambia Central Bank has confirmed receipt of the US$ 750 million Euro-bond.

Recently, Zambia sold its first Euro-bond, which was conversely over-subscribed, raising 750 US$ 750 million, from the initially planned US$ 500 million.

But the Bank of Zambia has confirmed receipting the respective money, which it says came in two tranches.

Part of the money is said to have been transmitted from Europe and the other from the United States, therefore the two tranches.

The respective Euro-bond, with a 5.4 % interest, was facilitated by the Barclays bank group of the United Kingdom and the Duetsche bank group of Germany.

ZAMBIA INFLATION ON THE RISE

Zambia’s inflation rate for September has risen to 6.6 %, from 6.4 % for the month of August.

The new inflation rate is however within the 7 % targeted by government by year-end.

 The Central Statistical office has since attributed this to the recent rise in prices of food, among them the staple food, maize meal.

Under the respective period, prices of maize meal rose by at least 12 % for a 25 kilogramme bag, further giving rise to a 7.5 % monthly food inflation.

Therefore food prices accounted for 3.9 percentage points to the overall inflation rate, while non-food prices accounted for 2.7 percentage points.

ZAMBIA CENSURED ON SOVERAIGN BOND UTILISATION

The World Bank has censured the Zambian government on the need for prudent investment of resources from the recently obtained US$ 750 million sovereign bond.

The Bank says the fact that the bond is a commercial debt, must present a challenge for the government.

In a statement, the World Bank has therefore proposed effective and transparent investment of the money into sectors, with the highest return, to provide lasting benefits for the people of Zambia.

The bank’s regional Director, Kundhavi Kadiresan has further observed that Zambia has a peculiar state of two extremes of social-economic situations, the noted high economic growth and high unacceptable levels of poverty.

She therefore says the country has a wide spectrum for investment of resources from the bond.

Meanwhile, the World Bank has also stated the need for a careful medium-term strengthened debt management strategy, to avoid another debt trap.

Zambia has recently mobilised a US$ 750 million loan, through the floating of a sovereign bond, which was heavily over-subscribed.

The bond has a decade long repayment period at an interest rate of at least 5.4 per cent.

KAFUE GORGE LOWER TIME-FRAME SET FOR 2018

The construction of Zambia’s third major hydro-electricity plant, the Kafue Gorge Lower, has been accorded a time-frame of up to 2018.

This is according to the national power utility, ZESCO in a statement.

The 750 megawatts plant will be built, adjacent to the current Kafue gorge power station.

The Kafue Gorge lower, which is being set up at a cost of US$ 2 billion, is expected to help mitigate the southern African nation’s acute power deficit.

The country is currently grappling with inadequate power supply, owing to increased social-economic activity, rendering the national power utility, ZESCO to ratio the commodity.

Meanwhile, the other major power generation plant at Kariba, will only become fully functional not until the end of 2014.

The Kariba North Bank power station is being upgraded, with the installation two extra generation machines, at a cost of US$ 420 million.