Zambia Just Got a Credit Upgrade: What It Actually Means for You in Simple Terms

By Savior Mwambwa

Fitch Ratings (one of the world’s three major credit rating agencies) has upgraded Zambia’s Long-Term Foreign-Currency (LTFC) Issuer Default Rating (IDR) to ‘B-‘ from ‘RestrictedDefault’ (RD). This is according to Fitch’s own rating action commentary released on Friday 28th November 2025 titled: “Fitch Upgrades Zambia to ‘B-‘; Outlook Stable”Think of it like your credit score going from “do not lend to this person” to “risky, but manageable.”This happened because Zambia has normalized relations with most of its external commercial creditors after restructuring $3.8 billion in Eurobonds in June 2024, plus reaching agreements on an additional $272 million of other commercial debt.What This Means:

1. Zambia is officially out of default territory
   After becoming the first African country to default during the pandemic, Zambia has clawed its way back. About 94% of the $13.3 billion in debt that needed restructuring has now been dealt with. The remaining $889 million still being negotiated is mostly supplier credits and loans from development banks not the scary commercial stuff.
2. The debt situation is improving (on paper)
   Government debt is projected to drop from 114% of GDP in 2024 to 93% in 2025 and 85% in 2026. That’s still high the typical country at this rating level has debt around 51% of GDP but the direction matters.
3. Borrowing just got cheaper
   The average interest rate on Zambia’s external debt will be below 1.5% through 2027, compared to 7.5% in 2019. That’s a massive difference that frees up money for other things.
4. The economy is growing
   Real GDP growth ( for now lets put aside my own criticisms of the concept of GDP as a measure of growth aside) is FORECAST to hit 6% by 2027, up from 5.2% in 2025, driven by mining expansion and recovering agricultural production.
5. International reserves are building up
   Reserves are expected to grow to 5.4 months of import cover by 2027, up from 3.6 months in 2024. That’s a healthier cushion against shocks.
   What This DOESN’T Mean
6. Zambia is not “fixed”
   A B- rating is still deep in junk territory. For context, investment-grade starts at BBB-. Zambia is five notches below that. Fitch’s own model actually scored Zambia at CCC+ (even lower), but they bumped it up one notch because the restructured debt is so concessional.
7. Everyday costs aren’t dropping tomorrow
   Inflation will average around 14% in 2025 still painfully high, though it’s expected to decline to 8% by 2027. Your mealie meal prices won’t suddenly fall because of a credit rating.
8. The power crisis isn’t solved by this
   The report notes that 2024 growth was “resilient” partly because mines and large corporations got priority access to power during drought-related load-shedding. Regular households bore the brunt. A credit upgrade doesn’t generate electricity.
9. Elections could still shake things up
   Presidential and parliamentary elections are due in August 2026. Fitch expects policy continuity, but elections always carry uncertainty. According to the report, the ruling party could end up with a smaller parliamentary majority than its current 59% of seats.

Zambia can’t borrow freely on international markets
This upgrade doesn’t mean investors are lining up to lend. It means Zambia has graduated from “you literally just defaulted” to “you’re very risky but paying your bills again.” Big difference from “come invest here.”
Conclusion
This is genuinely good news. Zambia has almost completed one of the most complex debt restructurings in modern history and is being rewarded for fiscal discipline. But a B- rating is the financial equivalent of being released from hospital: you’re stable, not healthy.
The real test comes over the next few years. Can Zambia keep running primary surpluses? Will copper prices hold? Can the power sector get sorted? Will the 2026 elections stay calm?
For now, though lets take the win. Zambia is back from the brink.