Since coming to power in 2015, Zambia’s young, charismatic president has made delivering economic prosperity his priority. Setting the country on the right path involves some tough decisions and major outlays, but his government’s efforts are bearing fruit in the form of rising credit ratings and unprecedented investor interest. Here, he outlines the developments in areas such as agriculture, tourism and manufacturing, all designed to transform the lives of Zambians forever
You were elected in 2015 and re-elected for a full presidential term in 2016. What is the driving philosophy behind your administration?
The priority of the Patriotic Front (PF) is the mandate of the people – to positively transform their lives. The majority of our people are very poor, but the numbers indicate that we are on the right path. We have been forced to make certain decisions that might not appear in the people’s interest, but ultimately the benefits will accrue. We have been quite daring in removing certain mechanisms – for example, subsidies for electricity. But I’ve done it because I know that in the end we’ll be able to attract enough investment in that area, which means our economy will be able to grow and more jobs will be created. This is the generation that will transform the lives of Zambian people for good. And I think in the next two or three years, prosperity will be evidenced as good times arrive. We are not scared of biting the bullet in order to bring common good to our people.
How important is economic diversification for fostering growth in the country?
A main focus is to move away from dependence on copper to a more diversified economy that will be resilient enough to withstand both external shocks and unfavourable weather. To achieve this, we have set very clear goals. First, we want to prioritise the development of agriculture, livestock and fisheries and the entire value chain that goes with it. For us, food security is very important, and we will intensify agriculture through irrigation and by ensuring we diversify from being a maize producer to a producer of diverse crops. Cassava, for example, is a commercial crop – you can use it for biofuel and products are being set up in that respect. Second, we want to continue with our focus on infrastructure development to make Zambia a regional hub, build market linkages and open the country up to new opportunities. Third, we want to build a more robust energy sector to drive our transformation agenda. For this sector to be stable and resilient we want a healthy mix of sources including hydro, solar, wind, biomass and even nuclear plants. Without power, you cannot talk about industrialisation or advanced funding methods. Right now, we are constructing the Kafue Gorge Lower power station, a huge project which is expected to produce 720 megawatts of power. It should be up and running by about 2020. Fourth, we want to grow not only our tourism industry, but the range of products we can offer as a country. And lastly, we want to expedite the industrialisation of our economy and the use of ICT. To succeed in all these, we need strategic and long-term investment in the key sectors of our economy. As a government, we bring a progressive legal framework and investor-friendly policies. I envision an economy where our raw materials are processed into finished products here at home. We want to see “Made in Zambia” in the world’s top chain stores and supermarkets. That way, our people and the country will get a fair return on our natural resources.
There were problems in the economy in 2015 and 2016, but are we seeing a turnaround and Standard & Poor’s recently upgraded the sovereign bond rating. What lies beneath these positive signs?
Despite 2015 being a challenging year, our economy rebounded to 3.8 percent growth in 2016 and is expected to grow at 4.2 percent in 2017. This was triggered by macroeconomic stability, the implementation of reforms, facilitating trade and favourable commodity prices. And through that, we have realised the folly of not investing in certain sectors of our economy, such as energy. Had we had a policy of consistently investing in the hydropower schemes that are potentially available in the country, we wouldn’t have had the crunch we did. We are still importing electricity, but I think very soon we will be an exporter. Our seven-year development plan is guiding us in terms of how we want to go forward. Today, Zambia is on a very firm footing in terms of opportunities and investment. It’s not by magic that its rating is going up.
The year 2016 saw $3.4 billion in investment pledges. What is the government’s strategy to attract even more foreign investment?
The investment volumes that are coming into Zambia are unprecedented. And we know that those who invest do so for a purpose: to get a return. And the higher the return, the better. So, part of our strategy is to listen to prospective investors and achieve win-win situations in terms of policies. And also in terms of politics – because no one will want to be with you if you are always tearing at each other politically. When an opposition politician gives us an insight as to what we can do to improve the economy or the health sector, we take it into consideration. Besides that, we run a one-stop-shop model for business, have no exchange control or restrictions imposed on repatriations of profits, and my government has deliberately placed a high premium on low trade tariffs and minimal export controls to promote an export-oriented trade regime.
How important are Public Private Partnerships (PPPs) for further developing Zambia?
As a government we are embarking on serious, massive infrastructure development. And our goal of modernising the country’s infrastructure cannot be achieved without the effective participation of the private sector, so we have added incentives to encourage that participation. We, as a government, consider PPPs as important instruments for bridging the infrastructure gap across all sectors of the economy. There are certain areas we want to build up – agriculture, tourism and more – but there cannot be development in those areas if the roads are not there, or if the airports are not functioning properly. So, we have opened up these areas for possible investment, and based on that, we can safely say this economy will grow rapidly over the next five years. Nothing succeeds like success, so when you are a success story, people want to share that success with you. All those who have invested in Zambia will be able to say they are making money here.
What are the opportunities for Zambia now that Britain is exiting the European Union?
Brexit offers the two countries an opportunity to explore new frontiers of cooperation, while also strengthening existing ones. We believe there is a lot we can do with Great Britain in terms of focusing on development issues. Our presence in the Commonwealth will fit in well with the new approach because I have the impression that Britain will probably start paying more attention to the Commonwealth in the post-Brexit era. If they do, we will hear them. We consider the UK as an import ally and Zambia’s entry point to the rest of Europe. At the same time, Zambia’s geographical position offers the UK a unique opportunity to advance its economic interests in this part of Africa.
The crux of Zambia’s foreign policy is focused on economic diplomacy. What existing business synergies are there, and where do you see the biggest potential to boost economic cooperation between the UK and Zambia?
We want British investment to take a lead in sectors that have the greatest potential to improve the lives of our people and help in diversification. Agriculture is a salient example of what the UK?s Commonwealth Development Corporation (CDC) is doing in Zambia through its partnership with Zambeef, a large agribusiness in Zambia. CDC has invested $65 million to expand poultry production and increase its cold chain processing plant. This has enabled the company to be listed on the London Stock Exchange. In energy, I recently launched a gas and oil exploration project in the northern part of Zambia with British company Tullow Oil. The CDC has also expressed interest in investing in the Kalungwishi Hydroelectric Project. In finance, leading British financial institutions such as Barclays and Standard Chartered Bank are playing a critical role in our economy, and there is more potential to get involved. There are also opportunities in infrastructure and tourism, among other sectors. I am happy to note that the British Chamber of Commerce was established in Zambia in August 2014 to further promote bilateral trade and enhance private sector cooperation. Like all things in life, the opportunities available are not infinite and are quickly being taken up by investors. Therefore, I urge investors from the UK to partner with their Zambian business counterparts and complement our efforts to develop Zambia on a win-win basis.
How can Zambia’s tourism sector reach its full potential?
Tourism in Zambia is a big part of our economy, but we can do more. We’re looking at bringing in one million visitors annually, and we are already close. Our wildlife sanctuaries are unique, not only in the vast number of animal species, but also in their size. The Kafue National Park, for example, is not only the biggest national park in Africa, but it also occupies an area the size of Wales. We have some beautiful waterfalls in northern Zambia, which are not known to the outside world, even to normal people in Zambia – the Kalambo Falls and Lumangwe Falls. So, we really should do more in those areas. Furthermore, we have a tropical climate, with sunshine throughout the year and we pride ourselves on being a very hospitable country. We have to do a bit more in the area of wildlife and increase the number of lodges and beds. We’re also talking about improving airports and the country’s airstrips.
When your current mandate expires in 2021, what would you like to have achieved?
For me, the first thing is to continue to create economic prosperity for our people, leaving no one behind. I would like to be remembered as having improved living standards in these five years, which means good healthcare, affordable food, education, as well as overall economic prosperity for our people. But you cannot talk about prosperity without peace and stability. The two go together: peace and development. Things have been stagnant for a long time. Zambians have been dependent on copper. But even when copper mining is going up and other activities are doing well, we need to be saying: “what else can we do?” We are a mining country, for sure, but now we can also be an agricultural country and we can export energy in the region.
Zambia has remained a beacon of peace and stability in the region and at the same time it is a safe haven for refugees. What does this say about the country?
Zambia is proud to have more than 70 tribes living in harmony, guided by our motto of One Zambia, One Nation. As a result, Zambians are tolerant, peaceful and accommodating towards all humanity. Zambia is a haven of peace where refugees and those fleeing from civil strife elsewhere can find shelter. We were also home to the liberation movements of southern Africa. Many people around the world still regard Zambia as their home away from home. This peace does not come about by accident, but through collective responsibility. Our Constitution also emphasises the importance of morality and ethics, patriotism and national unity, democracy and constitutionalism, human dignity, equality, social justice, non-discrimination, and good governance. These values and principles have helped us remain a unitary, multiparty and democratic state. We are a country on the march to a better and brighter future, and we invite investors to come and be part of this epic journey.