Zambia Investor Briefing: October
OVERVIEW
MINING: First Quantum Minerals (FQM) has confirmed it is engaging in discussions with potential partners regarding its Zambian operations. Meanwhile, President Hakainde Hichilema officially opened the first Zambian Mining and Investment Insaka in Lusaka at the beginning of the month. China Nonferrous Mining Corporation (CNMC) has pledged a $1.3 billion investment in Zambian mining, science, and education technology for the next five years.
TRANSPORT AND TECHNOLOGY: Zambia has become an official member of the Central Corridor Transit Facilitation Agency (CCTTFA). Additionally, after signing a Memorandum of Understanding (MoU) between the Industrial Development Corporation (IDC) and Chinese JIJIA International Company Limited, Zambia will become the first African country to develop the cholera vaccine.
FDI: The US’s Millennium Challenge Corporation (MCC) and Zambia have signed a $491 million Zambia Farm to Market Compact. Meanwhile, the Czech Republic has prioritised Zambia as an investment destination in its list of development cooperation countries. Also this month, Zambia's dollar bonds surged following praise from Morgan Stanley for the country's 2025 spending plan.
WATCH: Zambia is Back has produced a documentary celebrating 60 years of Zambian independence. ‘Zambia: Stronger at 60’ celebrates Zambia’s rich history, vibrant business culture, and promising future. Directed by ZIB’s Choolwe Chibomba, it features a host of guests, including politicians, business leaders, musicians, and football stars.
READ: The latest Forbes ‘African Undiscovered’ edition, ‘Zambia: Driving Change and Connection’, featuring interviews with Minister of Tourism Rodney Malindi Sikumba and Minister of Energy Peter Kapala among others.
COMING UP: KoBold Metals CEO Africa Mfikeyi Makayi will speak at the upcoming Critical Minerals Africa summit in Cape Town from 6-7 November. Makayi will discuss the current project portfolio in Zambia, including the Mingomba Copper Mine, mine development plans and future investment strategy.
A CLOSER LOOK
Mining Developments
First Quantum Minerals (FQM) has confirmed it is engaging in discussions with potential partners regarding its Zambian operations but did not name specific companies involved in the talks. "We're more open to partnerships, and that includes in Zambia, but only if it's in the interest of our Zambian business, the Zambian government and all the stakeholders involved," First Quantum CEO Tristan Pascall said on a conference call with analysts. The announcement follows recent reports that Saudi Arabia's Manara Minerals is close to securing a minority stake in FQM’s Zambian copper and nickel assets in a deal potentially worth $1.5-2 billion.
In other mining news, President Hichilema presided over the official launch ceremony of the Lumwana Mine Super Pit expansion project in Kalumbila District. Barrick Lumwana's extra $500 million investment significantly boosts the country's copper production capabilities. The expanded project is set to create over 3,000 jobs during construction, with an additional 1,500 permanent positions once operational. It includes substantial infrastructure development and the implementation of cutting-edge mining technologies.
The China Nonferrous Mining Corporation (CNMC) has pledged $1.3 billion in investment over the next five years to support its various mining, science, and education technology operations. CNMC group chairperson Xi Zhengping said that by the end of 2025, half of the $1.3 billion investment would have been completed and that the Chambeshi Copper Mines would also receive $450 million. At the end of Xi Zhengping’s three-day visit to Zambia, he told President Hichilema about the plans to reopen shaft 28 at the Luanshya Copper Mine with an investment of $600 million plus a $200 million investment in Sino Metals and a warehouse project.
Earlier this month, President Hakainde Hichilema officiated the inaugural 2024 Zambia Mining and Investment Insaka, which attracted over 2,500 delegates from around the world. The event coincided with the celebration of 100 years of mining in Zambia. During his speech at the Insaka, the President explained, “We need to grow this sector to a level where minor shocks can be absorbed.” He says this is why the government has set a target of three million tonnes of copper production by 2031.
Finally, Zambia unveiled plans to create a mining-funded sovereign wealth fund. The Industrial Development Corporation (IDC), which aims to strengthen Zambia’s industrial base and create jobs, released a statement saying they would establish the sovereign wealth fund next year. The Fund's main goal is to support public finances during financial distress. The IDC said, “the wealth fund will allow us to invest the surplus revenues from our natural resources and other sources, ensuring financial stability.”
Transport and Technology
Zambia has become a full member of the Central Corridor Transit Facilitation Agency (CCTTFA). The Minister of Transport and Logistics, Museba Frank Tayali, signed the agreement during the Interstate Council of Ministers Meeting in Kinshasa, DRC. The Central Corridor is an integrated transport and logistics network which connects member states to the Indian Ocean through the port of Dar es Salaam in Tanzania. Zambia will benefit from greater access to major seaports by joining the Central Corridor, particularly the Port of Dar es Salaam, a significant foreign trade gateway.
In other news, Zambia reached a technological milestone by signing a Memorandum of Understanding (MoU) between the Industrial Development Corporation (IDC) and Chinese owned JIJIA International Company. This MoU will make Zambia the first African country to manufacture the cholera vaccine with the work of the Zambia Pharmaceutical Manufacturing Initiative and partners like Shanghai United Cell Biotechnology Company. Cholera poses a significant threat to the Global South, affecting 1.3 billion people globally and causing 2.86 million cases and 95,000 deaths annually.
Foreign Direct Investment (FDI)
The United States and Zambia have signed a $491.75 million Zambia Farm-to-Market Compact to assist Zambian farmers in accessing regional and global markets. The funds, given under the US MCC, will complement the US government’s investments in the Lobito corridor. The grant, comprised of $458 million from the US government and a $33 million contribution by the Zambian government, was signed as part of ongoing celebrations of Zambia’s 60th anniversary of independence and 60 years of US-Zambian relations.
The Czech Republic says it will invest €3 million per year in various sectors of Zambia from 2024-2030 as Zambia has been prioritised in the European country’s development cooperation list. Cezch Ambassador to Zambia, Pavel Prochazka said the Czech Republic is investing in education, health, nutrition, and many other sectors to promote development. The announcement was made at the Czech National Day in Lusaka, where Mr Prochazka said Zambia had been prioritized because it stood with the Czech people when the former Soviet Union occupied the country.
Zambia’s 2025 budget was announced by Finance Minister Situmbeko Musokotwane at the end of last month. The Budget impressed global markets with Morgan Stanley upgrading its outlook on the nation's bonds due to rising copper revenues and controlled spending. Yields on the nation’s $1.7 billion bonds due in 2033 dropped to 7.86% after the announcement, a record decline.
LONG READS
Zambia Agrees to $1.5 Billion Debt Revamp with Chinese Lenders (Bloomberg, 27.09.24)
Ambitious but Constrained: A “Climate Changed” Budget? (PWC, 30.09.24)
Can AI help Africa close the development gap? (Financial Times, 17.10.24)
Zambia Considering Debt-for-Nature Swap, Finance Minister Says (Bloomberg, 22.10.24)
Zambia: Driving Change and Connection (Forbes Africa)
UPCOMING EVENTS
4-8 November - African Energy Week Cape Town, South Africa
6-7 November - Critical Minerals Africa Summit Cape Town, South Africa
4-6 December - Africa Investment Forum Rabat, Morocco