Zambia has reached a historic US$5.2 billion in foreign exchange reserves, marking a significant turning point for the economy.
Speaking in an interview with Lusaka Star, Economist Yusuf Dodia said the increase could stabilize the currency and make imports like fuel and machinery cheaper for businesses.
“The milestone might be mostly symbolic, as Zambia still faces debt challenges after its 2020 sovereign debt default. These obligations could limit the practical benefits of the reserves,” Mr. Dodia said.
He stated that the milestone is notable and has the potential to influence economic stability, but its real impact depends on debts as the benefits may remain limited.
Meanwhile, Business Owner Tracy Phiri said that this would help make business operations more predictable for business owners.
She said the reserves could support currency stability, adding that a stable currency lowers production costs and eases inflation.
She added that the boost may also encourage investor confidence as lower risks make Zambia more attractive to investors, making it easier for businesses to secure adequate financing.
By Joseph Daka