By: Reuters

Zambia's mining, energy and agriculture sectors have drawn significant investor interest as the government's fiscal consolidation gains traction after emerging from a sovereign default, said Citi's country chief.

"We have noted increased interest, especially when we have seen significant strides being made in terms of bringing stability to the Zambian economy," said Lowani Chibesakunda, Citi's chief executive and banking head for Zambia, in an interview with Reuters on Tuesday.

"We have noted key interests in mining, in energy, as well as in agriculture."

Zambia is rich in copper, positioning it well as demand for the red metal grows, spurred by the transition to clean energy and soaring power needs for AI data centres.

"You cannot talk about the Zambian story without emphasising the importance of mining and seeing how copper prices have remained bullish," said Chibesakunda.

"The focus that is there now on copper-related products, be it your electric vehicles, et cetera, is really driving a lot of growth in that sector."

The government secured 97.85% participation in a cash tender offer for its $1.365 billion outstanding notes, launched on May 29, in what the Ministry of Finance described as part of broader efforts to improve debt sustainability and reduce long-term obligations. Citi acted as sole mandated bank to organize, structure, and execute the transaction.

In November, S&P Global upgraded Zambia's long- and short-term foreign-currency credit rating to CCC+/C from SD (selective default) with a stable outlook, formally removing the country's default status.

The upgrade followed the government's forecast of a rosier fiscal picture for 2026, estimating the budget deficit would more than halve and targeting economic growth of more than 6% after years of protracted debt restructuring and a severe drought.

Chibesakunda said she was also seeing new categories of investors entering the market for the first time.

"We have seen increased interest from players coming through from the Middle East ... just to give you a sense, the pharmaceutical sector, the technology space." In mining, "we've had players coming into this market that are mining for the first time," she said.

The broader investment surge is reflected in the data. According to United Nations trade data, Zambia attracted $1.24 billion in foreign direct investment in 2024, the highest inflow since 2015.

(Reporting by Colleen Goko; Editing by Anathi Madubela and Sonali Paul)