Reserves Rebuild on IMF Backing and Mining Recovery

Bank of Zambia Governor Dr. Denny Kalyalya has stressed the importance of maintaining Zambia’s foreign reserves, saying they are critical for emergency response.

Dr. Kalyalya explained that reserves serve as a financial buffer, providing support during crises such as droughts, epidemics like COVID‑19, or international conflicts that disrupt supply chains.

He noted that strong reserves allow the country to source essential imports from alternative markets and maintain economic stability.

Speaking during a media tour at the ongoing Zambia International Trade Fair in Ndola, Dr. Kalyalya also announced that the Central Bank has achieved its target of lowering inflation to between 6 and 8 percent.

He said with low inflation, the prices of goods and services are expected to slow down gradually, and the Bank remains hopeful of reducing inflation further.

Meanwhile, Bank of Zambia Manager for Reserves Management and Financial Markets, Progress Pezulu, explained that reserves had declined between 2019 and 2020 due to the country’s heavy debt burden.

He said reserves began to recover after 2021, boosted by US$1.3 billion from the IMF for the COVID‑19 pandemic and the revamping of mine operations at KCM and Mopani.