Zambia and SADC 2026 Outlook: The Green Metal Renaissance and the Path to Structural Recovery

By Pangaea Holdings | December 2025

As we approach 2026, the economic narrative for the Southern African Development Community (SADC) and Zambia, in particular, is shifting decisively. We are moving from the era of acute crisis management and debt restructuring into a period of strategic repositioning. While the global economy faces “multidimensional polarisation” and trade fragmentation, SADC finds itself at the fulcrum of a new commodity supercycle, driven not just by the green energy transition, but by the voracious resource demands of the Artificial Intelligence (AI) boom.

For investors, 2026 represents a watershed moment. It is the year when structural reforms begin to yield tangible dividends, and when the “risk premium” on Zambian assets recalibrates from distressed levels to a frontier growth story.

The Global Backdrop: A Tale of Fragmentation and Opportunity

The synchronised global growth of the past decade is over. In its place is a fractured landscape defined by “US Exceptionalism” and by divergent monetary policy. With the US economy projected to grow at a robust 2.4–2.6% in 2026, driven by fiscal stimulus and AI capital expenditure, the Federal Reserve is expected to maintain a “higher-for-longer” rate environment compared to the 2010s.

However, for resource-rich economies, the silver lining is the “AI Lift”. The massive build-out of data centres globally has created a structural deficit in copper supply. 

Goldman Sachs forecasts copper prices to consolidate around $11,400 per tonne in 2026; however, as “boots on the ground”, we anticipate copper prices to end next year at between $12,500 $12,750. 

This is no longer just an electrification story; it is a computational one. Zambia, as a primary holder of these critical mineral assets, is the direct beneficiary of this new industrial revolution.

Zambia 2026: The Pivot to Growth

Zambia enters 2026 as a bellwether for post-default recovery. Following the successful restructuring of 94% of its external debt and a credit rating upgrade to ‘CCC+’ by S&P Global, the country has regained essential fiscal breathing room. The 2026 National Budget targets aggressive real GDP growth of 6.4%, a significant leap from the drought-induced stagnation of previous years.

Three key pillars underpin this bullish outlook:

1. The Copper Renaissance: The government’s target of 3 million tonnes of annual copper production is moving from ambition to execution. 2026 will see the sinking of the main shaft at KoBold Metals’ Mingomba project, a Tier-1 deposit backed by Breakthrough Energy Ventures, FQML’s S3 launched mid 2025 and peak construction at Barrick’s Lumwana “Super Pit.” These projects are not merely extractive; they are massive magnets for FDI that will stimulate the local service and logistics sectors.
2. The “State-Contingent” Dividend: Zambia’s restructured debt features a unique mechanism that accelerates repayment terms only if the country’s debt-carrying capacity improves to “medium.” For 2026, Zambia is likely to remain in the “weak” capacity category, allowing the government to retain concessional interest rates and channel revenue into domestic growth rather than external debt service.
3. Infrastructure as Strategy: The various PPP programmes are evolving from concept to logistical realities, opening various nodes across the country. The PPPs will integrate the Copperbelt with Atlantic markets, Far East and accelerate efficiency, drastically reducing export lead times and affirming Zambia as a land-linked logistics hub rather than a land-locked state.

Regional Dynamics: SADC’s Multi-Speed Recovery

The broader SADC region is projected to grow at 4.4% in 2026, but performance will be uneven.

• Angola faces headwinds from a projected decline in oil prices (forecast to average ~$56/bbl), making its diversification into logistics via the Lobito Corridor an urgent economic imperative.
• South Africa offers a picture of fragile stability under the Government of National Unity (GNU), with growth edging up to 1.5%. While logistics and energy reforms are taking hold, it remains a low-growth anchor compared to its northern neighbours.
• The Frontier Alpha: The real growth engines are the mid-tier economies, Zambia, Tanzania, and the DR, which are successfully leveraging their critical minerals and strategic geography to attract Western capital seeking supply chain security.

Risks: The Election Year Test

Optimism for 2026 must be tempered with a clear-eyed view of political risk. Zambia goes to the polls on August 13, 2026. The tension between maintaining the strict fiscal consolidation mandated by the IMF (a 2.1% fiscal deficit target) and the political necessity of social spending will be acute. Investors should monitor “Electionomics”, specifically, potential wage bill overruns or unbudgeted subsidies, that could threaten the inflation target of 6-8%.

Investment Implications

For our clients and partners, the 2026 outlook suggests distinct strategic opportunities:

• Fixed Income: With the US Fed cutting rates and the Bank of Zambia maintaining a vigilant stance on inflation, Zambian government bonds offer attractive real yields. The stabilising Kwacha makes the carry trade increasingly viable for risk-tolerant capital.
• Equities: The banking sector is poised for volume growth as the government reduces its crowding-out effect, forcing banks to lend to the real economy. The fintech and telecom sectors will benefit from the continued digitisation of the economy.
• Tangible Assets: The structural deficit in copper and the geopolitical premium on non-Chinese supply chains make mining services, energy generation (solar/thermal), and logistics infrastructure prime targets for direct investment.

Conclusion: The year 2026 is not without volatility, but it offers a rare convergence of structural reforms and favourable commodity dynamics. For Zambia, it is the year the “Green Metal” promise begins to materialise in the real economy. At Pangaea, we remain positioned to help investors navigate this transition, identifying value where global trends meet local resilience.

Disclaimer: This article is for informational purposes only and does not constitute financial advice. Forecasts are based on available data as of late 2025 and are subject to change.