IFC launches first bond from international issuer on Zambia's capital market
The International Finance Corporation (IFC) issued on Tuesday a 150 million kwacha bond (€20.7 million) to support domestic capital markets and increase access to local-currency finance in Zambia.The International Finance Corporation (IFC) issued on Tuesday a 150 million kwacha bond (€20.7 million) to support domestic capital markets and increase access to local-currency finance in Zambia.
This bond is IFC's first kwacha-denominated bond and the first placement by a non resident issuer in Zambia's domestic capital markets.
"Vibrant domestic capital markets create access to long-term, local-currency finance for the private sector - the key engine of job creation in emerging markets," said Jingdong Hua, IFC Vice President and Treasurer. "The IFC Zambezi bond supports our efforts to deepen domestic capital markets in Africa, so they can sustain a thriving private sector in the region."
The four-year bond was designed to appeal to a broad range of domestic and international investors looking to diversify their portfolios. The order book was over 700 million kwacha, equivalent to an oversubscription of 4.8 times.
In the last ten years, Zambia has seen a robust economic growth, but the economy still relies mostly on mining and the poverty rate remains above 65 percent, according to the IFC. Through the bond, the institution seeks to support the economy’s diversification away from mining.
Mr Hua said during a visit in the country in December 20011 that the nation holds tremendous opportunity for investment and development impact, including the entire value chain of agribusiness, infra and hydro power, tourism, mining, health care, and micro and SME financing.