THE ZAMBIA NATIONAL FARMERS UNION HAS ADVISED THE PRIVATE SECTOR TO TAKE ADVANTAGE OF THE COUNTRY’S B-PLUS RATING BY EXPLORING EXTERNAL BORROWING AT LOWER COSTS

THE ZAMBIA NATIONAL FARMERS UNION HAS ADVISED THE PRIVATE SECTOR TO TAKE ADVANTAGE OF THE COUNTRY’S B-PLUS RATING BY EXPLORING EXTERNAL BORROWING AT LOWER COSTS WHICH WILL CREATE AN IMPETUS FOR DOMESTIC LENDING INSTITUTIONS TO REDUCE DOMESTIC INTEREST RATES.

ACCORDING TO A PRESS STATEMENT MADE AVAILABLE TO RADIO PHOENIX TODAY ZNFU PRESIDENT JARVIS ZIMBA HAS NOTED THAT COUNTRIES THAT ARE NOT RATED ARE OFTEN DEEMED RISKIER THAN THOSE WITH A CREDIT RATING WHICH LEADS TO HIGHER INTEREST RATES ON LOANS AND OTHER DEBT INSTRUMENTS OBTAINED EXTERNALLY.

MR. ZIMBA ADDS THAT IN SUCH A SITUATION, INVESTORS INTENDING TO LEND MONEY TO GOVERNMENT OR THE PRIVATE SECTOR REGULARLY USE CREDIT RATING TO EVALUATE WHETHER THE MONEY OWED TO THEM CAN BE REPAID WITHIN THE SCHEDULED OR SPECIFIC PERIOD.

HE HAS STRESSED THAT OBTAINING THE CREDIT RATING WILL HELP REDUCE THE COUNTRY’S BORROWING COSTS ON FUNDS MUCH NEEDED FOR INFRASTRUCTURE DEVELOPMENT AND THE PRIVATE SECTOR ALSO STANDS TO GAIN BECAUSE THE RATING WOULD PROVIDE THEM WITH THE OPPORTUNITY TO ACCESS LONG TERM FINANCE AT REDUCED COST.

MR. ZIMBA HAS POINTED OUT THAT THE RATING PITS ZAMBIA AS ONE OF THE LESS RISKY INVESTMENT DESTINATION AND PUTS THE COUNTRY IN GOOD STANDING WITH INSTITUTIONAL INVESTORS WHICH BROADENS ZAMBIA’S CAPABILITY TO ACCESS GLOBAL CAPITAL MARKETS.

THE UNION HAS URGED THE GOVERNMENT TO CONTINUE TO IMPROVE ON PUBLIC POLICY MANAGEMENT SO THAT A CONDUCIVE ENVIRONMENT FOR DOING BUSINESS CONTINUES TO IMPROVE TO PRESERVED THE CURRENT RATING AND ATTAIN AN UPPER BAND CREDIT RATING SUCH AS TRIPPLE A.

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