Zambia has moved out of the external debt default status after S&P Global Ratings upgraded the country’s long and short-term foreign currency sovereign credit ratings to ‘CCC+/C’ from ‘SD/SD/’ with a stable outlook.

S&P Global Ratings is a division of S&P Global that provides independent credit ratings, which are opinions on the creditworthiness of a company or government and its ability to meet its financial obligations.

The upgrade is a major milestone in Zambia’s economic reconstruction journey and is a clear signal of renewed international confidence in the reform programme being implemented by the current government.

It is also a reflection of the steady fiscal discipline, strengthened policy credibility and decisive measures taken by the government to resolve the debt overhang that has constrained economic activity since the year 2020.

The S&P rating action further affirms the improving macroeconomic and institutional landscape driven by tangible progress in restructuring external debt, the resilience of the mining sector and the stabilisation of inflation expectations.

According to a press statement issued to ZANIS by the Ministry of Finance and National Planning in Lusaka today, S&P notes that Zambia has reached restructuring agreements with official and commercial creditors representing about 94 percent value of the debt within restructuring parameters.

This means that only a small portion of the commercial debt, largely with commercial banks, remains under negotiation.

And reacting to the development, Minister of Finance and National Planning, Situmbeko Musokotwane, said that the decision by S&P Global Ratings is a strong vote of confidence in Zambia’s economic reforms, governance credibility and the resilience of citizens.

“It confirms that Zambia has moved out of default status and is steadily restoring its place as a credible, stable and investable economy,” Dr Musokotwane explained.

He added that this rating also stands as a powerful acknowledgement of Zambia’s pioneering role under the G20 Common Framework.

“As one of the earliest countries to undergo this process, Zambia travelled a difficult and uncertain path, navigating complex negotiations, unprecedented legal and technical requirements, and the economic pressures of the debt distress,” he said.

Dr Musokotwane said the upgrade is therefore not only a recognition of economic progress, but the testament to the determination, discipline and endurance of the government and the Zambian people.

The minister further said the upgrade is an affirmation that government policies aimed at debt sustainability, export-led growth, stable macroeconomic environment, improved governance, and expanded energy capacity form a coherent and credible strategy for national resilience and long term prosperity.

“The government remains committed to ensuring that improved ratings, stronger fundamentals, and restored fiscal health translate into more jobs, stable prices, and greater opportunities for youth and women, stronger local business participation, and shared prosperity for all Zambians,” he explained.

He has since profoundly appreciated all official and commercial creditors who are bilateral, multilateral and commercial, as well as  cooperating partners, civil society, private sector actors, and the Zambians in general for supporting the country throughout its most challenging period.

“Their patience, dialogue and constructive engagement made it possible to restore stability and place the country on a sustainable economic path,” he said.

And the government has reiterated its resolve to sustain fiscal discipline, completing the remaining components of the debt restructuring process, expanding energy capacity, strengthening social protection and empowerment programmes, and supporting private-sector-led growth for both local and foreign investors.

Zambia’s move out of the default status now underscores that the risk posed by potential holdout creditors remains contained due to strong safeguards, including comparability-of-treatment principles under the G20 Common Framework for Debt Treatment and most-favoured-creditor clauses built into the Eurobonds.