WHAT DOES THE S&P UPGRADE MEAN FOR “ORDINARY” ZAMBIANS?

WHAT DOES THE S&P UPGRADE MEAN FOR “ORDINARY” ZAMBIANS?

My fellow citizens, following some inbox comments after our initiation press release and my media briefing on Sunday, allow me who has seen many seasons of our nation’s journey to share a word. I have lived through the hopeful days, the difficult days, and the years when things seemed to fall apart faster than they could be put back together.

I was here (as Minister of finance and National Planning 2008-2011) when Zambia’s creditworthiness was strong enough to inspire confidence. I was also here between 2015 and 2021 (as opposition MP), when things began slipping — quietly at first, then suddenly — and the country drifted into a debt storm that many of us feared we would not easily escape.

But today, as I reflect on the S&P decision to upgrade Zambia’s credit rating from Selective Default to CCC+, I feel a type of hope I have not felt in many years — not reckless hope, but the grounded hope that comes from seeing real work being done, real discipline being restored, and real lessons finally being applied.

Let me explain, in simple language, how we got here, and why the upgrade matters for you, your children, and this country we all cherish.

How We Got Derailed

Between 2015 and 2021, the truth is that Zambia lost control of its borrowing. Some loans were signed without proper Ministry of Finance assessment, and most of them even without full parliamentary oversight. Guarantees were issued quietly, records of debts of state-owned enterprises were poorly managed, and big projects were launched without clear analysis of who would pay tomorrow’s bill.

By 2018–2019, the warning signs were flashing red

1) Debt figures kept changing;
2) Revenues could not keep up with expenses;
3) Borrowing shifted from concessional sources to expensive commercial lenders;
4) No IMF anchor existed to guide fiscal discipline; and,
5) And by 2020, when the country failed to pay a US$42.5 million Eurobond coupon, we officially fell into default.

https://youtu.be/p_uX96ZUjhI?si=3xqYfCqLiOC5Y1w2

Let us be honest, it was not just external shocks. It was choices. It was governance gaps. It was systems that were too weak to protect the country from itself. That default stained our credibility and shut the door to international markets. Businesses suffered, costs went up, and the country was thrown into one of its toughest economic phases.

The Turning Point: Post-2021 Reforms and the Climb Back Up

After 2021, something changed — not overnight, but steadily. A new approach took root:

1) Transparency was restored in debt reporting;
2) Fiscal discipline returned;
3) Incorrect and hidden debt numbers were cleaned up;
4) The IMF programme provided an anchor;
5) Debt restructuring negotiations began in earnest; and,
6) And Parliament passed the Public Debt Management Act, 2022, which for the first time demanded that every loan must be approved and justified — no more backdoor borrowing.

These reforms were not glamorous. They were slow, painful, technical, and disciplined. But they restored credibility.

And because of that work, Zambia has now been upgraded by S&P, officially moving out of default territory after five very long years.

Why This Upgrade Matters to Ordinary Citizens

Some people may ask, “How does an S&P rating help me when nshima is still expensive?”
The answer is simple: Ratings determine what the country pays to borrow, and what the country pays influences your cost of living.

This upgrade means:

1) Investors see Zambia as a safer place to do business;
2) Government can access cheaper financing for roads, clinics, schools, energy, and water systems;
3) The economy becomes more predictable — and predictability lowers prices;
4) More investments can flow into mines, tourism, agriculture, trade and logistics;
5) Jobs begin to grow in sectors that were dormant: manufacturing, transport, construction, services; and,
6) The country enters a path where inflation can stabilise and the Kwacha can regain some strength

In short, the upgrade is a step toward normalcy, toward the Zambia we want — where young people find jobs, where businesses can breathe, where farmers can plan, and where the cost of living does not feel unbearable.

A Man Who Has Seen It All — And Now Feels Hope Again

As someone who lived through both the good years and the difficult ones, let me tell you what gives me hope today: for the first time in a long time, Zambia is not just growing by chance, it is growing by design. We now have:

1) A functioning debt management system;
2) Parliament controlling borrowing at a detailed level;
3) An IMF-backed framework pushing discipline;
4) State-Owned-Enterprises being supervised tightly;
5) Transparent quarterly debt updates;
6) A renewed culture of policy predictability; and,
7) And a national commitment to never repeat the mistakes of 2015–2021.

This is why international partners are responding positively. This is why investors are returning. This is why S&P has moved Zambia out of default. The country is not yet where we want it to be, but it is firmly walking in the right direction.

But Let Us Be Cautious: Slippages Can Destroy Everything

Let me sound a warning, from a man who has seen how quickly things can fall apart. Economic recovery is fragile. One wrong step can take us back.

To get to a rating upgrade, we have avoided:

1) Unauthorized borrowing;
2) Opaque deals;
3) Reckless spending;
4) Hidden guarantees;
5) Undisciplined SOEs; and,
6) Weak procurement controls.

If we slip into old habits, this new trust can evaporate in an instant. The safeguard measures put in place after 2022 must be protected fiercely. They are the guardrails that will keep us on the path to prosperity.

Where Do We Go From Here

The S&P upgrade is not just a technical announcement, it is a national milestone, a sign that Zambia can rebuild, reform, and rise again.

If we stay disciplined:

1) Cost of living will stabilise;
2) Energy and agriculture reforms will boost productivity;
3) More jobs will open in mining, manufacturing, tourism, logistics and services;
4) The private sector will expand;
5) SMEs will find more opportunities; and,
6) And our young people, who are the majority, will inherit a stronger, fairer, more resilient Zambia.

We have travelled through a painful valley. Now, cautiously but confidently, we are climbing toward higher ground. Let us protect this progress. Let us stay focused.

And let us never again walk blindly into the mistakes that once brought this country to its knees.

Better days are possible — if we remain vigilant, united, and committed to responsible governance.

– Dr Situmbeko Musokotwane, MP
Minister of Finance & National Planing