Removal of foreign exchange laws boasts Zambia property sector


“The investment climate right now is positive. We have a lot of opportunity for residential property development with the introduction of mortgages. This is a new thing for Zambia. We haven’t had a strong mortgage market,” Inutu Bagus, managing director of Pam Golding properties Zambia, told CNBC Africa.

“Because of the young and upcoming professionals who are becoming accustomed to credit, we’ve seen that there’s an opportunity there for residential [property development].”

The recent scrapping of the SI33 and SI55 foreign exchange laws has given the Southern African country’s property sector an additional boost, and upward growth is expected over the next few years.


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“It’s definitely a positive for Zambia. I think what we experienced with the introduction of SI33 and SI55, which happened about 18 months ago, was a loss in investor confidence in the country. What made Zambia different from other African countries, and what was very attractive was the fact that we could transact in US dollars and you could index your agreements in US dollars,” Bagus explained.

“With SI33 and SI55 being introduced, with foreign exchange monitoring, we saw a decline in investment. Since [its] scrapping, we can see positive things are happening. We’ve already seen an appreciation in the kwacha, and on the property market people are already talking. We’ve been receiving a lot of calls to say, ‘now, let’s get back into Zambia, and let’s see what we can do ‘”.

Bagus added that Zambia’s property market has since been poised for investment, though the sector hasn’t had substantial investment. Nevertheless, over the past five years, Zambia’s national pension fund has invested heavily in commercial, residential and retail real estate.

(READ MORE: Investor appetite for sub-Saharan Africa’s retail property market)

Retail property development is also on the move, with four shopping malls having being built in the last five years in Lusaka, the capital city. Zambia previously didn’t have any shopping malls.

Migration from the central business district to new property nodes is also indicative of widespread investment and development opportunity in various spaces within the sector.

“There is opportunity not just only in the capital city, but also in the copper belt, which is our mining area, and more recently now with the new mining area, which is the north western part of the country,” said Bagus.

“[The rural area] has really been neglected, but we see a lot of opportunity in the rural areas: convenience shopping centres, some level of structured housing as well. We see that there are opportunities there because the Zambian economy is changing.  There’s a middle income group that is emerging even in the smaller areas and towns. We’re not just looking at Lusaka.”