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Zambia

Situation and cooperation

Young girls sell fruit at roadside, Zambia.

Since 1990, Zambia has transformed from a centralised one-party state to a comparatively stable democracy. However, there are deficits as regards responsible governance and the rule of law, as well as in the observance of human rights. In 2016, Zambia was ranked 87th out of 176 nations assessed in the international Corruption Perceptions Index (CPI).

When President Michael Sata died in October 2014 after a long illness, extraordinary presidential elections were held in January 2015. Edgar Lungu of the Patriotic Front (PF) won with a small majority. He was re-elected for a further term in August 2016. In the run-up to the elections, the opposition were repeatedly banned from holding meetings and the freedom of the press was curtailed by means of invoking a Public Order Act from colonial times.

Economic development

Between 2010 and 2014, Zambia’s economy grew by more than six per cent on average. However, in 2015, economic growth dropped to just 2.9 per cent, and the International Monetary Fund (IMF) expects a similar rate for 2016. In the spring and summer of 2016, inflation occasionally ran higher than 20 per cent and for food it was even more than 25 per cent. Since October last year, the situation has eased a little once more.

However, the budget deficit continues to grow, due in part to high exposure to foreign borrowing, with loans worth billions; cost-intensive public subsidy programmes for energy and the agricultural sector; and considerable expenditure on public service. Public debt is close to 60 per cent of Gross Domestic Product (GDP). At the end of 2015, the government started to undertake first consolidation measures. A programme of assistance is currently being prepared by the International Monetary Fund.

Zambia is home to Africa's biggest copper mining and smelting industry. The Zambian economy’s heavy dependence on copper exports, however, makes it vulnerable to commodity price swings.

More than half of the population earn their living in agriculture. Experts reckon that Zambia could in fact produce significantly more food, including for regional export, as it enjoys favourable natural conditions. To date, however, only a small part of the country's arable land is being used for agricultural purposes; productivity is low and value creation negligible.

Zambia also has considerable potential to generate energy using hydro and solar power. The country has about 40 per cent of southern Africa's water resources; 95 per cent of Zambia's electricity is generated by means of hydropower. As too little was invested in the energy sector in recent decades and the right framework is lacking (tariffs, for instance, are too low to cover costs), this potential is not being harnessed. In fact, the country is currently facing an energy crisis with several hours of power outages a day because of several years with low levels of rainfall and a lack of investment in energy infrastructure.

The government is currently carrying out three major traffic infrastructure programmes, upgrading roads throughout the country. Many parts of the country, however, remain inaccessible, especially during the rainy season. And many of the transit routes into neighbouring countries have not yet been sufficiently improved.


Social situation

Mother and child in Zambia

In spite of Zambia's many years of economic success, the situation for the people living in poverty has improved only marginally. Throughout the country, nearly two thirds of the population still lives below the poverty line, in rural areas the proportion rises to around three quarters of the population. The economy is still too narrowly focused on copper mining, a sector that offers few jobs. The structural reforms that the economy needs are being implemented only slowly. There is a lack of sufficiently trained personnel and funds, especially at the local level of public administration. On the latest United Nations Human Development Index (HDI 2015), Zambia is ranked 139th out of 188 countries (164th in 2011).

The malnutrition rate in Zambia lies at 47.8 per cent, leading to significantly impaired health – especially in children – and constituting a major obstacle to the country's development in general.

The wide prevalence of HIV in Zambia is a further huge issue for the country; 12.9 per cent of adults between the ages of 15 and 49 are infected. Average life expectancy has plummeted in the wake of the epidemic and stood at merely 41 years in the late 1990s. The availability of antiretroviral therapy has since brought it back up to 60 years. With the support of its international cooperation partners, the government is actively striving to fight HIV and AIDS, with some visible success.

The social and legal status of women in Zambia is largely determined by traditions. Although gender equality is enshrined in the constitution and is being demanded by an increasingly active women’s rights lobby, social change is slow in coming. State sanctions against gender-specific violence and oppression of women are inadequate.


Environment

Sunrise at the river Zambezi in Zambia

Zambia is increasingly struggling with the impact of climate change and is active in international fora to promote climate action. Precipitation patterns have become increasingly irregular, leading to more and more droughts and flooding. The current energy crisis is largely due to less rainfall, because hydropower is the main source of energy in Zambia.

Zambia's biodiversity is unique and conservation measures are urgently needed. Although the regulatory framework for such measures is in place, efforts to implement such measures still fail all too often due to the lack of political will and environmental awareness and because the relevant institutions are underfunded and lack capacity.

The dramatic level of largely uncontrolled commercial logging in Zambian forests is alarming. Large sections of the population are also contributing to deforestation as wood and charcoal are the sole source of energy for most of the population. Zambia now has one of the highest rates of deforestation in the world.

Zambia's large elephant population is under serious threat from poaching. The rhinoceros had become extinct in Zambia; efforts to reintroduce the species in the country have only begun in recent years. The spoil heaps from copper mining along with inappropriate management of toxic substances that are a by-product of mining are sources of environmental pollution, especially affecting rivers and groundwater.


Development potential

Zambia has natural economic advantages: besides copper, the country has ample other mineral resources such as cobalt and gemstones. It has considerable water resources, a comparatively favourable climate, and also wildlife reserves, national parks and large tracts of as yet unused land suitable for agriculture.

The potential of the agricultural sector is especially high. So far, it only contributes 5 per cent to the country's gross domestic product but employs more than half the population. At the same time, expanding the country's agricultural production offers a promising opportunity to reduce poverty and malnutrition in Zambia and to overcome the one-sided focus on copper mining.

Zambia's government hopes that growth in tourism, mining and construction will also help boost the economy. However, the risk here is that major infrastructure projects, especially road projects, are not sufficiently covered by the national budget and need to be financed by loans. This contributes to increasing public debt.


Priority areas of cooperation

Germany is one of Zambia’s larger international cooperation partners. In 2016, the German government committed a total of 97.5 million euros for development cooperation with Zambia for the period from 2016 to 2018. Since 2014, additional funds of up to 20.5 million euros have also been available to Zambia from the BMZ's special initiative ONE WORLD – No Hunger.

At government negotiations held in December 2016, Germany and Zambia agreed to continue cooperation in the following priority areas:

  • Water and sanitation
  • Good governance (decentralisation, promoting public participation, good financial governance/public financial management)

There are two further areas in which Germany and Zambia are engaged in cooperation:

The BMZ Special initiative ONE WORLD – No Hunger:
Zambia is a pilot country for this initiative. Several projects to promote cooperation between the private sector, civil society and public authorities with a view to facilitating agricultural innovation and fighting malnutrition are being supported. A green innovation centre is promoting skills and technological innovation for issues ranging from production to marketing focusing on two value chains, legumes and milk. Projects on agricultural financing enable farmers to take out loans to purchase seeds or tractors, for instance, and get training on financial matters and business management. Another project is aimed at fighting malnutrition. It is based on the international Scaling Up Nutrition (SUN) process and promotes local dialogue on its implementation.

Energy:
In response to climate change, Germany is pursuing a regional programme to encourage greater use of renewable energy sources in Southern Africa. At the government negotiations in December 2016, Germany pledged a considerable amount of funds to Zambia for an innovative programme to expand the use of solar power in collaboration with the private sector, amongst other programmes.


Water and sanitation

Rural Water Supply in Zambia

Zambia has enormous water resources. And yet, almost half of the rural population has no access to safe drinking water. Adequate sanitation services are available to only 36 per cent of the rural population and 56 per cent of city dwellers. Especially in the mushrooming peri-urban settlements, sanitation services are often poor. Climate-smart management of valuable water resources is still in its infancy.

In the light of climate change, one focus of cooperation is on improving the sustainable management of Zambia's water resources. Germany has been a key supporter of the reform process to commercialise the water supply in Zambia and develop an independent regulation system.

Through its involvement Germany is seeking to improve access to safe drinking water and appropriate sanitation facilities for the poor in rural and urban areas. This has so far benefited more than two million people. Fetching water is traditionally a female chore. If they have a shorter distance to go to get water, women have more time to engage in gainful activities and girls are more likely to be able to attend school regularly.


Good governance

Good governance is the basis for favourable economic development and successful poverty reduction. German development cooperation activities in support of good governance can be seen in the following areas:

Zambia's budget planning, implementation and auditing is often not sufficiently systematic and structured. Public revenue is too low, corruption and clientelism are rife. Through development cooperation projects on good financial governance, Germany is providing advice to the Ministry of Finance and the Zambian tax authority on how to improve management of public finances and increase tax revenue.

Germany is supporting Zambia's efforts to implement its policy of decentralisation. The measures focus on advising the relevant government ministries and selected districts on issues such as budget planning, financial management, regional planning and service orientation.

In the field of public participation, Germany is helping to strengthen civil society partner organisations and networks with a view to enabling them to play a more effective role in shaping decision-making processes. Development cooperation has been instrumental, for instance, in launching a constructive dialogue between civil society and the government on a disputed registration law for non-governmental organisations. Together with the EU, efforts are being made to improve the access of poorer people, in particular, to justice.


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