By Derrick Silimina

Bank of Zambia Governor Denny Kalyalya says the country has experienced remarkable growth in foreign direct investment (FDI) in 2024, reaching an unprecedented $2.36 billion.

Speaking on his behalf by BoZ Deputy Governor – Operations Francis Chipimo said these developments signal renewed investor confidence in Zambia’s economic recovery, policy direction, and medium-term outlook.

“This outstanding performance was largely driven by reinvested earnings, particularly in the mining, manufacturing, and deposit-taking sectors, as well as increased equity capital in mining and manufacturing, and heightened intercompany debt inflows towards mining firms,” Dr. Kalyalya said this during the 2025 Investor Perceptions Survey Dissemination held at the Mulungushi International Conference Centre in Lusaka.

Dr. Kalyalya noted that this figure represents the highest level since the survey began and is a significant increase from $641.1 million in 2023.

He outlined that on the other hand, net private sector foreign liabilities remained relatively stable, with a net inflow of $712.9 million adding that this stability can be partially attributed to a reduction in other investment liabilities, primarily due to loan renegotiations in the mining sector.

“As a result, the stock of foreign liabilities increased by 9.9 percent, reaching $19.8 billion. The mining sector accounted for 60.1 percent of this amount, followed by manufacturing at 15.5 percent, deposit-taking corporations at 8.0 percent, electricity at 6.4 percent, and wholesale and retail trade at 4.2 percent,” Dr. Kalyalya stated.

He further highlighted that these inflows are poised to generate significant macroeconomic benefits, which are expected to strengthen export growth, improve foreign exchange reserves, enhance fiscal revenues, stabilise the exchange rate and potentially lower inflation over the medium to long term.

Dr. Kalyalya underscored that ultimately, these advancements will contribute to greater economic resilience and improved living standards for the people.

In a meantime, the Central bank Governor disclosed that in the first half of 2025, preliminary data suggest a drop in FDI inflows to $157.9 million, from $580.5 million during the same period in 2024.

“This decline is primarily linked to debt repayments owed to affiliated entities in the mining sector. Concurrently, the stock of private sector foreign liabilities rose by 12.7 percent totalling $17.9 billion. This increase was driven by reinvested earnings and currency deposits, with FDI representing 64.8 percent of the total.”