Overview

  • Zambia is Africa’s second-largest copper producer achieved middle-income country status in 2011, during a decade (2004-2014) of impressive economic growth, averaging 7.4% per year. However, growth only benefitted a small segment of the urban population and had limited impact on poverty. Zambia ranks among the countries with highest level of inequality globally. Fifty-eight percent of Zambia’s 16.6 million (2015) people earn less than the international poverty line of $1.90 per day (compared to 41% across Sub-Saharan Africa), and three quarters of the poor live in rural areas.

    In 2018, the Zambian economy was projected to expand by 3.5% compared to 3.4% in 2017. The slight increase in growth reflects strong performance of services (in particular, wholesale and retails, pensions and information and communication) in the second half of 2018.

    However, faster recovery was undermined by lower crop harvest, the accumulation of new public expenditure arrears and government domestic borrowing at high yields. In the first half of 2018, K2 billion in arrears were accumulated. As a resulting the financial sector vulnerabilities remained elevated. Despite a narrower trade deficit than in 2017, external pressures remained elevated in 2018, reflecting the high cost of debt service.

    The current account is estimated to have remained wide above 4.5% of GDP. With reduced foreign direct investment (FDI) and portfolio inflows in 2018, the current account was largely financed by a drawdown on foreign currency reserves, which fell to $1.6 billion (two months of imports) in October 2018. External and fiscal pressures exerted pressure began to put pressure on the kwacha (which depreciated by 12% in 2018, before stabilizing at approximately $1= K12. 

    The depreciation has not substantially affected inflation, which has largely remained in its medium-term range of 6-8%. As a result, the Bank of Zambia kept a broadly neutral monetary policy stance 2018, maintaining its policy rate at 9.75% (the lowest level since January 2014) at all its 2018 MPC meeting. Looking ahead, there are several risks to medium-term inflation that may necessitate monetary policy tightening in the coming months

    Zambia is large and landlocked in the center of southern Africa. It shares several of its key geographical and economic features with neighboring Zimbabwe—the Victoria Falls, Lake Kariba (and its hydroelectric capacity), and a stretch of the Zambezi River. It also borders the southern tip of Lake Tanganyika and Tanzania, as well as the Democratic Republic of the Congo, Angola, Botswana, Mozambique, and Malawi. Its population, much of it urban, is estimated at about 16.5 million (2016).

    Zambia is considered a stable country in Africa with successful democratic elections held every five years. The next elections will be held in 2021. The current President is Edgar Chagwa Lungu of the Patriotic Front Party was re-elected in August 2016, in a closely contested presidential race with his main rival, Hakainde Hichilema of the United Party for National Development (UPND).

    A Systematic Country Diagnostic (SCD) has been prepared to augment the World Bank’s understanding of the sort of mechanism needed for poverty reduction in Zambia. The SCD informed the Bank’s Country Partnership Framework (CPF), for the period 2019–2023.  The CPF focus areas are:

    1. Increase opportunities and jobs for the Rural Poor
    2. Increase public Services and Social Protection to build a healthy and skillful workforce
    3. Build Resilient Institutions

    The CPF is aligned to government’s 7th National Development Plan, 2017–2021.

    The five pillars of the seventh NDP:

    • Economic diversification and job creation
    • Poverty and Vulnerability
    • Reduced Developmental Inequalities
    • Enhancing Human Development
    • Conducive Governance Environment for Economic Diversification

    The strategic goal of the seventh National Development Plan is to create a diversified and resilient economy for sustained growth and social economic development. It will also include a results-oriented, performance management system to be used to measure the progress of its implementation.

    Last Updated: Mar 27, 2019

  • World Bank Country Partnership Strategy for Zambia

    The World Bank’s Country Partnership Framework (CPF) for Zambia for the period 2019-2023 is closely aligned with the government of Zambia’s National Development Plan and Vision 2030. The CPF is supporting Zambia in achieving its development goals, by focusing on three pillars; promoting opportunities and jobs for the rural poor, investing in human capital, and building resilience.

    The strategy is aligned with the government’s development priorities.  Zambia ranks among the countries with highest levels of poverty and inequality globally. 58% (2015) of Zambia’s 16.6 million people earn less than the international poverty line of $1.90 per day (compared to 41% across Sub-Saharan Africa) and three quarters of the poor live in rural areas.

    Zambia is Africa’s second-largest copper producer which achieved middle-income country status in 2011, during a decade (2004-2014) of impressive economic growth, averaging 7.4% per year. However, growth only benefitted a small segment of the urban population, with limited impact on poverty.

    Currently, the World Bank portfolio in Zambia has 14 projects with a total commitment of 1.2 billion united states Dollars. Agriculture accounts for 18% of the World Bank portfolio infrastructure (roads, water and electricity), accounts for about 60% of the Bank’s portfolio, and the average life of a project is 3.8 years. The other sectors are currently as follows: environment (11%), agriculture (10%), finance and private sector development (8%), the public sector (8%), and human development (5%). Grants now account for about 18%of the current total net commitments while credits are at 82%.

    Last Updated: Mar 27, 2019

  • Increasing access to electricity in Zambia

    The World Bank is supporting the Zambian Government on electricity access initiatives and continues to invest heavily in access across Zambia. Between, 2009 and 2015, the Bank financed the connection of approximately 91,000 households – benefiting almost 500,000 people. More recently, through the Electricity Access Project, Bank is also supporting subsidizing the cost of connection to the grid for 22,000 low-income households and about 1,000 Small Enterprises in rural areas.

    Improving maternal, neonatal, child health (MNCH), and nutrition in Zambia

    The Health Services Improvement Project has contributed to an increase in childbirth deliveries attended to by skilled health providers in project areas from a baseline of 27% in 2013 to 48.5% in March 2018 in project areas. Fully immunization coverage for children below one year has also increased from a baseline of 80% in 2013 to 89.5% in March 2018 in project areas.

    Southern Africa Tuberculosis and Health System Support

    Southern Africa Tuberculosis and Health System Support project is a regional center for occupational lung diseases established in Zambia’s copper belt to serve the Southern Africa Development Community (SADC) region. The centre is facilitating laboratories compliance with regionally harmonized standard operating procedures for surveillance of Multi Drug Resistant Tuberculosis (MDR-TB) case notification.

    Girls’ Education and Women’s Empowerment and Livelihoods (GEWEL) Project

    In the first year of implementation, GEWEL exceeded its targets, reaching 26, 000 extremely poor girls and women. By 2020, the program aims to scale up to almost 100,000 girls and women in half of the districts nationwide. The targeting of these girls and women builds on well-tested, national poverty testing techniques used under the national Social Cash Transfer Scheme, as well as participatory community methods. GEWEL is implemented by the Government of Zambia with financial support from the World Bank.

    Supporting Financial inclusion in Zambia

    The World Bank is supporting the government to implement the Zambia Financial Inclusion Country Support Program. The Financial Inclusion Country Support Project includes the provision of advisory services, capacity building, and knowledge, as well as convening services for policy and regulatory reforms to promote financial inclusion that build on existing projects and advisory services. A Country Support Program (CSP) has been developed by the World Bank team in partnership with the Ministry of Finance (MoF), Bank of Zambia (BoZ), the Securities and Exchange Commission (SEC), and the Pensions and Insurance Authority (PIA). Zambia has a well-established National Financial Inclusion Strategy (NFIS) coordination structure that supports the NFIS implementation

    Strengthening Climate Resilience in Zambia

    The Strengthening Climate Resilience Project has supported improving canals in the floodplains. Thirty-four secondary and tertiary canals have been rehabilitated, providing additional land to over 2,000 households; and (ii) in Mbeta Island of Sioma district, a natural lagoon is helping 66 vulnerable households (57 female-headed) to integrate fish farming, thus diversifying their sources of livelihood and promoting the use of a hitherto untapped resource. For sustainability, a National Standard Norms and Procedures Manual for the operation and maintenance of the canals has been developed. 

    Last Updated: Mar 27, 2019

  • The, African Development Bank, European Union, United Nations agencies, Germany Government, British Government, Swedish, Dutch, and United States are among the partners of the World Bank. The World Bank Group’s strategy adheres to the principles agreed with other partners supporting Zambia development efforts, as articulated in the Joint Assistance Strategy for Zambia (JASZ), and comprises highly selective targeted interventions that maximize the impact of government’s development efforts.

    The World Bank Group

    World Bank (WB) support to Zambia commenced in 1955, well before attaining its independence in 1964. As of March 2016, the WB has 14 active projects, including eight national International Development Association-financed projects with a net commitment amount of $861 million, two trust-funded projects ($54m) and four regional projects valued at $162 million. The International Finance Corporation (IFC) is planning to reinstall its Resident Representative in the Lusaka Country Office in the near future.

    The IFC has a significant portfolio in Zambia, mostly in agribusiness and financial services as well as manufacturing. The current IFC portfolio in Zambia includes 13 projects, totaling $86.5 million, which is made up of an investment portfolio of $55.9 million and pipeline to the value of $155.8 million. Multilateral Investment Guarantee Agency (MIGA) are also providing support for Zambia’s development.

    MIGA has about $101 million in commitments in Zambia and guarantees are helping agriculture, livestock and aquaculture development. A MIGA guarantee for Agrivision Africa (formerly Chayton Africa) is helping a large commercial farm in the Copperbelt Province to achieve efficient agricultural practices and expand capacity of a grain processing facility, thereby providing substantial demonstration effect to other farms.

    MIGA has also supported the Silverlands Fund through a multi-country Master Reinsurance Contract with the Overseas Private Investment Corporation in Silverlands Ranching Limited which is helping improve and develop a large cattle farm in Zimba, Southern Province.

    Regional Trade Facilitation

    Zambia has committed to implementing policy reforms to enhance regional trade. Zambia is part of the Common Market for Eastern and Southern Africa (COMESA) and the Southern African Development Community (SADC) bodies that promote regional trade.  Overall, Zambia has performed well in all dimensions of the regional integration index, ranking second in COMESA and fourth in the SADC region.

    Last Updated: Mar 27, 2019

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LENDING

Zambia: Commitments by Fiscal Year (in millions of dollars)*

*Amounts include IBRD and IDA commitments


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Additional Resources

Country Office Contacts

Main Office Contact
Pyramid Plaza
Church Road, PO Box 35410
Lusaka, Zambia 10101
+260-211-373200
+260-211-252811
For general information and inquiries
Carlyn Hambuba
Communications Associate
+260 211 373 218
chambuba@worldbank.org
For project-related issues and complaints
zambiaalert@worldbank.org