Zambia's Bonds and Global Indices: What the Finance Minister is Really Asking For

By Savior Mwambwa
 

27 February 2026, London

Most Zambians have heard Dr Situmbeko Musokotwane say he wants Zambia's bonds included in global indices. I also know that most people are asking  what does that actually mean? And more importantly, what does it mean for us?
 

When the Zambian government needs to borrow money beyond what it collects in tax revenue, one option is to issue bonds. A bond is a simple concept: the government says lend me this amount today, I will pay you back in a set number of years, and every year I will pay you interest. Zambia issues these bonds both domestically in Kwacha and internationally in US dollars. It is the international ones we are talking about here.

Now, in the world of international finance, there are what you might call league tables for bonds. The biggest ones are managed by institutions like J.P. Morgan, Bloomberg, and FTSE. [J.P. Morgan Emerging Market Bond Index (EMBI), Bloomberg Global Aggregate Bond Index, and FTSE World Government Bond Index.] Think of them as the S&P 500 equivalent but for bonds. These indices bundle together bonds from dozens of countries into a single list. Think of it like a curated menu at a restaurant. The chef has already selected what is on offer. If your dish is not on the menu, nobody orders it.
 

Trillions of dollars sitting in pension funds in Europe, insurance companies in America, and sovereign wealth funds in the Gulf are managed passively. That means fund managers do not sit around picking which country's bonds to buy. They follow the index. If the index says buy Zambia, they buy Zambia. If Zambia is not in the index, we simply do not exist to them. We are not on the menu.
 

So Dr Musokotwane is essentially saying “put us on the menu”

The implications are significant. When more investors are buying your bonds, it pushes the price up and the interest rate down. Zambia currently pays very high interest on its international borrowing. Lower interest would mean the government spends less on debt servicing. That money could go to roads in Muchinga, clinics in Luapula, or CDF in Southern Province.
 

There is also the credibility question. In 2020, Zambia became the first country in Africa to default on its debt under the G20 Common Framework. It was a painful and frankly embarrassing moment for the country. Inclusion in global indices would be the financial equivalent of being promoted back to the Super League after relegation. It tells the world that Zambia is creditworthy again. That our house is in order.

Another issue is what it takes to get there. Index providers do not just let anyone in. They look at how much debt you have issued, what your credit rating is, whether foreign investors can easily buy and sell your bonds, and whether your financial market infrastructure meets international standards. Zambia has work to do on several of these fronts.

When big international money comes in, it can also leave very quickly. If there is a global crisis, if commodity prices drop, if investors get nervous about emerging markets, that money exits overnight. The Kwacha takes a hit. Interest rates spike. We saw this happen repeatedly in South Africa and Nigeria during various global shocks. The same pipeline that brings capital in can drain it out just as fast.
 

So yes, Dr Musokotwane's ambition is the right one. Zambia needs to be visible on the global investment map. But visibility comes with vulnerability. The question we should be asking is not just how to get into these indices, but whether we have the buffers and the institutions to manage the volatility that comes with it.

End.