Trade and Economy
Trade and Economy
Zambia has recorded several favourable macroeconomic indicators for over a decade. The average Gross Domestic Product (GDP) growth rate of 6 percent has been anchored by good performance in the mining, agriculture, manufacturing, services and construction sectors. During this period, the country's average GDP growth rate has also been generally higher than that achieved in the sub-Saharan Africa (SSA) region. In addition, the country attained the lower middle income status in 2010 and by 2015 its per capita GDP had reached US$1, 800.
Regarding foreign direct investment, inflows into Zambia rose from US$ 72 million in 2008 to a high of US$ 2,100 million in 2013, before reducing to US$ 1,300 million in 2014. In 2014 and first half of 2015, international prices of primary commodities were generally low, which temporarily affected the country's export earnings and some macroeconomic indicators. By June 2016, Zambia had a total of US$1.8 billion in investment pledges across various economic sectors over the preceding six months. The energy sector registered the highest amount of the pledged investments, followed by the agriculture and the manufacturing. This represents an increase of 20%, compared with the US$1.5 billion investment pledges recorded in the first half of 2015.
It should also be noted that as a result of Zambia's business environment reforms, the country is now ranked 8th in Africa, 5th in the Southern African Development Community (SADC) and 4th in the Common Market for Eastern and Southern Africa (COMASA) in terms of the ease of doing business. Furthermore, Zambia is ranked the 8th most competitive country in Africa on the Global Competitiveness Index. Recently, Zambia was ranked 7th by Forbes as the best country for doing business among 54 African countries.
In the area of trade, Zambia recorded a positive trade balance of US$ 300.6 million in 2014, as well as an increase in non-traditional exports (NTEs) over the years from US$ 1,381.8million in 2010 to USD 3,550.3 million in 2013. Copper and cobalt are among Zambia's main exports while non-traditional exports include cotton, coffee, fresh flowers, burley tobacco, gemstones and maize (corn) among others.
Zambia is also eligible to export duty-free goods to the United States under the African Growth and Opportunity Act (AGOA). The Act allows eligible countries from sub-Saharan Africa to export over 6,400 goods to the U.S.
The Vision 2030
The Zambian people aspirations and vision is to make the country a prosperous Middle Income Nation by 2030. It is in this regard that the Zambian Government came up with a national long term plan known as the Vision 2030 which long term development policy scenarios at different points for the next 20 years.
The Vision is being operationalised through the five year developments plans and annual budgets.
The socio-economic development objectives enshrined in the Vision 2030 are to: attain and sustain annual real growth of 6 percent (2006-2010); 8 percent (2011-2015); 9 percent (2016-2020); and 10 percent between 2021 and 2030. Other objectives include to attain and maintain a moderate inflation rate of 5 percent; to reduce national poverty head count to less than 20 percent of the population to reduce income inequalities measured Gini-coefficient of less than 40 percent; to provide secure access to safe water and improved sanitation facilities of 100 percent of the population across the country; to attain education for all; and to provide equitable access to quality health care to all by 2030.
The Seventh National Development Plan (7NDP)
Following the expiry of the R-SNDP in 2016, the Government spearheaded the formulation of the Seventh National Development Plan which will cover the period from 2017 to 2021. The Plan departs from sectoral-based planning to an integrated (multi-sectoral) approach under the theme “Accelerating development efforts towards Vision 2030 without leaving anyone behind”. The formulation of the Plan was guided by the National Planning and Budgeting Policy of 2014, while the Decentralisation Policy of 2014 provided the principles of implementation. Further, the formulation of the Plan was informed by the need to harness the demographic dividend in view of Zambia’s youthful population.
Arising from the chosen theme, the goal of the 7NDP is to create a diversified and resilient economy for sustained growth and socio-economic transformation driven, among others, by agriculture. The realisation of this goal will be achieved through the contribution of a number of developmental outcomes. The key outcomes include economic diversification and job creation; reduction of poverty and vulnerability; reduced developmental inequalities; enhanced human development; and the creation of a conducive governance environment for a diversified and inclusive economy. The Plan will bring about inclusive development without leaving anyone behind and achieving more with less resources, through integration and coordination of developmental efforts. These will be achieved taking into account regional and global development agendas, such as the Regional Indicative Strategic Development Plan (RISDP), which is a comprehensive development and implementation framework guiding the regional integration agenda of the Southern African Development Community (SADC) over a period of fifteen years (2005-2020), African Union Agenda 2063, Sustainable Development Goals (SDGs) and the Common Market for Eastern and Southern Africa (COMESA) protocols.
The Government of the Republic of Zambia places high premium on the implementation of this Plan as it is a turning point in the realisation of the strategic objectives of Vision 2030, because it takes an integrated approach. Actualisation of the 7NDP will, therefore, be achieved through an Implementation Plan, which will guide execution of programmes in this Plan
This Plan will:
Implement interventions to diversify the economy away from mining. The Plan will also enhance programmes for social protection.
Implement employment creating interventions that reduce informality and improve decent work conditions, with a special focus on rural areas.
Re-emphasise the importance of the agriculture, mining and tourism sectors towards poverty reduction and employment creation by improving the incentives structure and removing the binding constraints to growth.
Institutionalise results-based management in all Ministries, Provinces and other Spending Agencies (MPSAs.)