LUSAKA, ZAMBIA, December 12, 2024 — Zambia could attract up to $21 billion in new investments and directly create an additional 80,000 formal jobs by 2030 by implementing reforms across four sectors, according to a report published today by the World Bank Group.
The new Zambia Country Private Sector Diagnostic (CPSD) takes a focused look at the Zambian economy, and identifies mining, agriculture, tourism, and renewable energy as sectors where targeted and concrete policy action could realize significant investment potential within two to five years.
The report points to several constraints and specific actions that the Zambian government will need to address in the four sectors to help them contribute to better jobs and higher incomes for the people of Zambia, including the need for a more predictable, market-friendly policy environment.
Some of the specific actions include:
· Standardizing exploration licenses to ten years and introducing non-exclusive reconnaissance licenses to unlock Zambia’s mineral resource potential.
· Facilitating the smooth implementation of regulations enabling independent power producers to access the grid and sell power directly to customers, potentially unlocking up to $1 billion in investments in solar photovoltaics (PV) generation by 2030.
· Reshaping agricultural programs to remove market distortions and fund crucial infrastructure like all-season roads and irrigation systems to enhance the country’s agricultural competitiveness.
· Streamlining tourism licensing requirements and leveraging private sector participation in managing wildlife areas.
If the government were to implement the suggested reforms, net foreign investment could increase to $4 billion annually, significantly exceeding its historical share of GDP, the CPSD authors argue.
“Harnessing the opportunities identified in the CPSD will help Zambian firms realize profitable private investment opportunities, create jobs, generate domestic revenue to finance growth-enhancing spending, and boost inclusive and sustainable economic growth,” said Mary Porter Peschka, IFC Regional Director for Eastern Africa. “IFC is committed to supporting Zambia in increasing the role of the private sector in the economy.”
“There is great optimism about Zambia’s macroeconomic future, especially as the country works to restore fiscal stability,” said Nathan Belete, the World Bank Country Director for Zambia. “Zambia has the opportunity to make some very quick wins for the further development of the private sector by implementing the fiscal measures and regulatory reforms highlighted in this diagnostic.”
Zambia’s diverse minerals, vast arable land, young and growing population, and strategic location present significant opportunities for regional integration and private investment.
The Zambia CPSD informed the new World Bank Group Country Partnership Framework (CPF) for Zambia (2024 – 2029), which was launched recently. The CPF is a strategic document that guides the World Bank Group's support to a member country. The Zambia CPF focuses on three thematic areas: creating more and better jobs, improving human capital, and enhancing climate resilience. It also prioritizes private sector-led growth as a means to foster conditions for inclusive, sustainable, and resilient economic development.
The Zambia CPSD can be downloaded here.
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About the Country Private Sector Diagnostic
The Zambia Country Private Sector Diagnostic (CPSD) is the first in a series of newly revised CPSD reports. Designed from the perspective of an investor or entrepreneur, this new generation of reports seeks to identify untapped private investment opportunities and the barriers that stand in the way (earlier reports can be found here). The sector opportunities are chosen based on their potential to spur private investment, create jobs, generate domestic revenue, and foster sustainable, inclusive growth in response to concrete and targeted policy reform.
The report aims to help country policymakers prioritize the most impactful actions that can boost private sector growth, while delivering on broader development goals. Prepared jointly by the institutions of the World Bank Group, each report discusses the overall business environment within a country and provides a deeper analysis of specific sectors in which private sector investment could accelerate growth, if appropriate policy and regulatory issues are addressed.
The Country Private Sector Diagnostic is one of the World Bank Group’s core country diagnostics produced to guide the design and implementation of public and private investment projects, budget support operations, advisory services, and other analytical work.
About the World Bank Group
The World Bank Group works to create a world free of poverty on a livable planet through a combination of financing, knowledge, and expertise. It consists of the World Bank, including the International Bank for Reconstruction and Development (IBRD) and the International Development Association (IDA); the International Finance Corporation (IFC); the Multilateral Investment Guarantee Agency (MIGA); and the International Centre for Settlement of Investment Disputes (ICSID). For more information, please visit www.worldbank.org, ida.worldbank.org/en/home, www.miga.org, www.ifc.org, and www.icsid.worldbank.org.
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