ECONOMIC REVIEW
Zambia’s economic performance in recent years has been positive with real Gross Domestic Product (GDP) growth rising to 6 .8 percent in 2011 from 5.3 percent in 2005. This marked the sixth year in a row in which the economy grew above 5 percent. Zambia continued to recorded strong growth in 2011 mainly due to increased output in mining and quarrying, construction and agriculture. The Government put in place measures to diversify the economy from the traditional (copper and cobalt production) to non-traditional production and exports (products and exports other than copper and cobalt). The non-traditional products began to exhibit a positive and favorable performance in value terms in the country’s balance of payments. The export of these products more than trebled, their value increasing from U S$ 210 million in 2000 to U S$ 1,245 million in December 2011.
OVERVIEW OF ZAMBIA’S INVESTMENT CLIMATE
The country’s central location in the region, as well as a combination of the following key strengths makes it an ideal investment location:
Abundance of natural resources and manpower;
Political Stability since attaining independence in 1964;
Abolition of Controls on: prices, interest rates, foreign exchange rates, free repatriation of debt repayments;
100 % repatriation of net profits;
Guarantees and Security to investors with legislated rights to full and market value compensation;
Duty Free Access to Regional, wider African
and the USA markets under SADC, COMESA/FTA and AGOA (African Growth and Opportunity Act) respectively;
Banking, Financial, Legal and Insurance services of international standard as well as a Stock Exchange;
Double Taxation Agreements with a number of European, North American, African and Asian countries;
Good place to work and live– subtropical climate and vegetation with plenty of water;
Friendly people, mostly English speaking, with high literacy rate;
Thriving Private Sector.
SECTOR PROFILES
1. Mining
Zambia is the world’s fourth largest producer of copper and holds six percent of the world’s known reserves thereof. Copper and cobalt, as the country’s traditional exports account for well over 70 percent of export earnings. These include gold and gemstones (e.g. emeralds, aquamarine, topaz, opal, agate and amethysts).
2. Tourism
The vast potential in the tourism sector in Zambia, with its natural beauty (including the Victoria Falls, which is one of the most renowned beautiful transcendental Seven Natural Wonders of the World) and the wealth of wildlife have yet to be fully exploited.
3. Agriculture
Although the agricultural sector employs more than half of the total labour force, only 15 percent of the arable land is under culti-vation. Government encourages investment in commercial farming and has established farm blocks to facilitate investments in agricul-ture.
4. Manufacturing
The main manufacturing activities in Zambia are the Food, Beverages and Tobacco sub-sector. Support measures designed to aid manufacturing enterprises in non-traditional sectors are being implemented.
5. Energy
With its vast water resources and coal reserves, Zambia offers abundant investment opportunities for hydroelectric power generation, supply and distribution.
6. Health
Major surgery cases are usually referred to the Republic of South Africa. Investment opportunities for establishing specialized hospitals to treat such referral cases are, therefore, unexploited.
7. Infrastructure
Major rail line links Zambia with Tanzania, is jointly owned by the Zambian and Tanzanian governments and is run by Tanzania-Zambia Railway Authority (TAZARA). The Lusaka and Livingstone International Airports are Zambia’s main airports. The smaller airports include Ndola, on the Copperbelt province and Mfuwe, in the Luangwa National Park.
8. Telecommunications
Currently three companies, the Zambia Electricity Supply Corporation (ZESCO), the Copperbelt Energy Corporation (CEC) and the Zambia Telecommunications Company (ZAMTEL) are licensed to operate optic fibre networks, and there are mobile telephone services namely Airtel Zambia, MTN and Cell-Z(a mobile segment of ZAMTEL).
