Post date: Mar 10, 2011 6:55:56 PM
Rupiah Banda expects Zambia's economy to grow by 7.5 percent and sets his sights on a 500 million US dollars eurobond issue for roads, power and housing before the next elections, scheduled for 2011.
LUSAKA, ZAMBIA REUTERS - Zambia plans its first foreign bond issue to raise $500 million for roads, power and housing before a presidential election this year that President Rupiah Banda told Reuters he was confident of winning.
The economy of Africa's biggest copper producer is riding the commodity price surge and Banda said at the Reuters Africa Investment Summit in Johannesburg, that growth could be as high as 7.5 percent this year.Zambia recently received a B+ rating from credit rating agency Fitch, putting it on par with continental oil producers Nigeria and Angola, allowing the country to go ahead with a bond issue.
With copper at $10,000 a ton and pressure mounting on Rupiah to maximize revenue from the sector, he ruled out windfall taxes for mining companies arguing that changing the rules would scare foreign investment.
"I see my government's role as one of an enabler, it is not the government's role to own industries and to try to run them, we've tried it before without any success, in fact resulting in confusion and almost bankruptcy-that is what we have tried to do these last three years," said Rupiah Banda, Zambian president
He also hoped to recover more than $200 million in unpaid dues as a result of a tax audit of mining companies.
Banda, said his Movement for Multi-party Democracy hoped to win a bigger majority than when he was elected in 2008 despite the fact that Zambia's two main opposition parties have joined forces in an election pact.
He gave no date for the elections, but said they should be coming soon. Banda's party won the last elections after the death of former President Levy Mwanawasa.
"It is my desire and also that of my government to ensure that the elections are held in a free and fair manner and that the standards of good electoral conduct are upheld. My government and I believe, democracy and good governance is vital for economic growth and poverty reduction, we are strengthening our governance structures to ensure increased accountability and transparency," said Banda
Copper fell to below $3,000 a tonne in late 2008 -- shortly after Banda came to power -- but has since recovered sharply on the back of a resumption in demand from resource-hungry Asian economies such as China and India.
Zambia produces around 800,000 tonnes of copper a year.