Zambia's economy demonstrated resilience in 2024, expanding by 4% despite facing challenges such as drought and power outages. This growth was largely attributed to the mining sector and services, while the agriculture sector encountered difficulties but contributed minimally to GDP.
The latest Zambia Economic Update (ZEU) maintains an optimistic outlook for the country's economy. It highlights robust momentum in the mining sector, a rebound in agriculture, and improvements in tourism as key drivers. Real GDP is projected to rise by 5.8% in 2025, with an average growth rate of 6.5% expected for 2026-27. The anticipated expansion in 2025 is partly due to base effects as the economy recovers from severe drought, aided by adequate rainfall during the current rainy season.
The ZEU recommends several measures:
- "Unleashing agricultural productivity by fully transitioning to the e-voucher system, improving targeting, and shifting toward private-sector-led financing to limit public liabilities."
- "Raising productivity through greater competition in the energy sector."
- "Closing tax gaps by strengthening revenue administration."
- "Maintaining monetary policy tightening to anchor inflation expectations and protect policy credibility, to achieve positive real rates."
A special section of this edition explores how Zambia can leverage Energy Transition Minerals (ETMs) for economic transformation. The ZEU suggests that maximizing this potential involves:
- "Scaling ETM Production: Implementing comprehensive reforms to boost ETM production, including identifying mineral resources, ensuring a reliable and cost-competitive clean power supply, transport, and logistics services, upskilling the workforce, and strengthening environmental and social risk management."
- "Maximizing Fiscal Potential: Strengthening ETM revenue management and allocation to support fiscal sustainability and broader inter-generational development objectives."
- "Adding Value to Mineral Resources: Developing the copper value chain and addressing barriers to greater value-adding activities, including the lack of access to raw materials and finance, enhancing the inefficient investment climate, augmenting the electricity supply, and reducing trade and transport time and costs."