Implications of Zambia’s $5.2 Reserves, Positive Fitch Rating

By Dr. Situmbeko Musokotwane, Finance & National Planning Minister-Zambia.

Understanding the New Credit Ratings and Why They Matter

Many citizens are asking: “We hear that Zambia’s credit ratings have improved and our national reserves now stand at a record US$5.2 billion — but how does this help my family?”

The question is fair and deserves a clear answer. Credit ratings reflect how the world judges a country’s ability to manage debt. For several years, Zambia lost that trust, which affected jobs, confidence and the cost of living. The recent upgrades by global agencies, lifting Zambia out of default status, show that confidence in our economic governance is being restored.

—Foreign Reserves as a National Shield, Not Spending Money.

At the same time, Zambia’s foreign-exchange (FX) buffers — formally known as Gross International Reserves (GIR) — have risen to an historic US$5.2 billion. These reserves are not for the Government’s routine spending. They serve as a national shock absorber, protecting the country during crises such as drought, global fuel price spikes, pandemics or financial instability.

Just as households keep emergency savings for unforeseen hardship, national reserves safeguard the economy, ensuring essential imports remain available and sudden price shocks are softened.

—How Buffers Help Control the Cost of Living

Strong reserves help stabilise the Kwacha. Zambia imports fuel, medicines, machinery, farm inputs and many essential goods, meaning FX shortages lead to sudden price increases. Reserves reduce panic, speculation and sharp price jumps, protecting households from unpredictable cost-of-living pressures.

—Fertiliser, Food and Reduced Currency Exposure

A structural shift is now underway as Zambia expands domestic fertiliser production. Previously, fertiliser prices rose with the dollar, pushing food prices upward. As import reliance decreases, farmers become less vulnerable to currency swings, strengthening food security and stabilising household costs.

—Investor Confidence and Job Creation

Improved credit ratings do more than restore reputation — they attract investment. Investors bring capital to build factories, mines, tourism facilities and energy projects.

These ventures create jobs for the youth, open markets for farmers, and generate opportunities for artisans, transporters and suppliers. As more citizens earn incomes, household pressure eases and the economy grows in a more inclusive way.

—Fiscal Breathing Space and Better Public Services

As debt pressures decline, The Government can better support health, education, agriculture, social protection, youth empowerment and SMEs. Predictability replaces crisis-driven decisions, giving families a more stable environment in which to plan their futures.

—How Reserves Enable Stronger National Shock Response

Reserves (GIR) also allow for rapid, orderly responses to national emergencies. Food, medicines and fuel can be secured even when global markets are stressed. Without buffers, every crisis becomes a source of panic — and panic always raises prices. With buffers, Zambia responds with calm and order, protecting families from unnecessary hardship.

—Confidence and Predictability in Daily Life

When stability improves, businesses stop raising prices defensively. Families experience steadier, calmer living conditions. This quiet predictability is one of the most meaningful benefits of macro-economic discipline.

—Shared Responsibility and the National Vision

Progress requires more than policy — it requires a shared national mindset. Citizens must support one another’s enterprises, develop skills, and participate in local decision-making. Business must uplift business, farmers uplift farmers, and youth uplift youth.

Ward Development Committees, District Development Coordinating Committees, cooperatives, churches, farmer associations, women’s groups and private-sector bodies form the real heartbeat of development.

Our Scriptures remind us to diversify our efforts (Ecclesiastes 11:2), maintain vision (Proverbs 29:18) and carry one another’s burdens (Galatians 6:2). These are economic principles as much as they are spiritual disciplines.

—A Realistic View of What Stability Achieves

These improvements do not make every commodity cheap overnight. What they do is stop uncontrolled price surges. They create a stable foundation on which farmers, businesses, youth and communities can plan confidently without living under fear of economic collapse.

—A Partnership for Shared Prosperity

Let us treat the credit-rating upgrades and the record US$5.2 billion in reserves not as symbolic achievements, but as practical tools for building a resilient, inclusive economy.

The Government commits to discipline, transparency and reforms that support jobs and incomes. Citizens must seize the opportunities created by stability and work together toward a prosperous, middle-income Zambia where wealth is widely shared.

If we walk this road together — the Government, private sector, civil society, communities and individual citizens — these national achievements will be felt in steadier food prices, calmer transport costs, reliable farm inputs, stronger businesses and a more predictable life for every household.

—Final Thoughts

With thanksgiving to God and profound respect for the patience, discipline and resilience shown by the people of Zambia throughout this period of reform, we now move forward together into the next chapter of our national journey.

May the season ahead be marked by safeguarded stability, strengthened growth and the steady accumulation of national wealth for the benefit of all — founded on sound economic governance, responsible leadership and broad-based, multi-sectoral investment. With sincere goodwill and confidence in our shared future, I wish every Zambian household peace, opportunity and lasting prosperity.