Zambia sales US$1 billion bonds

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Zambia has sold 10 year bonds worth US$1 billion with and 8.5 per cent coupon, reports Thom Shonga for the Zambian Eye.

According to reports by Bloomberg Zambia attracted more demand from investors in Africa’s first dollar-bond sale of 2014.

Zambia’s acting finance minister, Edgar Lungu who is also minister for defence, issued a statement that the proceeds will be used for transportation and energy infrastructure.

“The second bond just like the first was significantly oversubscribed – an expression and affirmation of the confidence the international community has in Zambia,” Lungu said.

Zambia, which was recently overtaken by the Democratic Republic of Congo (DRC) as Africa’s largest copper producing country, relies on copper for about 70 per cent of its export earnings. It sold its first dollar bond worth $750 million in 2012 at a coupon of 5.375 per cent.

The 2012 bonds sales were by Deutche Bank AG and Barclays Plc (BARC) attracted bids worth $12 billion. This year’s sales are led by the same banking institutions.

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