The World Bank in Zambia

Zambia is a large, landlocked, resource-rich country with sparsely populated land in the center of Southern Africa. It shares its border with eight countries (Angola, Botswana, Democratic Republic of Congo, Malawi, Mozambique, Namibia, Tanzania, and Zimbabwe) that serve as an expanded market for its goods. 

Zambia is experiencing a large demographic shift and is one of the world’s youngest countries by median age. Its population, much of it urban, is estimated at about 17.9 million and is growing rapidly at 2.8% per year, partly because of high fertility, resulting in the population doubling close to every 25 years. This trend is expected to continue as the large youth population enters reproductive age, which will put even more pressure on the demand for jobs, health care and other social services. 

Economic Outlook

The Zambian economy is expected to recover by 3.3 percent in 2021 following a historic contraction of 2.8 percent in 2020. The recovery is driven by high copper prices, improved post-election market confidence, and continued recovery in agriculture. Poverty is expected to increase slightly in 2021 by 0.2 percentage points to 60.3 percent, reflecting COVID-19 impacts.  Economic activity will gradually pick up, averaging 3.8 percent over 2022-25. However, risks stemming from prolonged debt negotiations and low COVID-19 vaccination rates will need to be managed.

Growth in the first three quarters of 2021 picked up to 4%, reflecting recovery in activities across all sectors except mining, which has been beset by COVID-related supply chain disruptions and excessive rainfall. High copper prices, improved market confidence following the August 2021 elections, and normal rainfall patterns are expected to buoy economic activity in 2022. Inflation has remained in double digits since mid-2019, reflecting exchange rate and food price pressures.

Political Context

Zambia gained its independence in 1964, under the leadership of first President Kenneth Kaunda. The nation is considered a stable country with successful democratic elections held every five years. After many years of a one-party state, Zambia became a multi-party state in 1991.

Zambia’s democracy is evident by the nine Presidential elections and four different political parties that have so far ruled the country. Among them are the United National Independence Party (UNIP 1964-1991), Movement for Multiparty Democracy (MMD 1996-2011), Patriotic Front (PF2011-2021) and currently the United Party for National Development (UPND). The current President Hakainde Hichilema of the UPND was elected in August 2021, after defeating then-incumbent President Edgar Lungu of the Patriotic Front. The next presidential elections in Zambia will be held on August 12, 2026. 

Last Updated: Apr 17, 2022

World Bank Country Partnership Strategy for Zambia

The World Bank Zambia Country Partnership Framework (CPF) FY19-23 supports the government in achieving its development goals, and is closely aligned with the government’s National Development Plan and Vision 2030. 

The CPF is underpinned by the Systematic Country Diagnostic (SCD), conducted in 2017 to augment the World Bank’s understanding of the mechanism needed for poverty reduction in Zambia. 

The CPF focus areas are: 

• Increase opportunities and jobs for the rural poor 
• Increase public services and social protection to build a healthy and skillful workforce 
• Build resilient institutions 

Zambia ranks among the countries with highest levels of poverty and inequality globally. More than 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. 

The current World Bank portfolio in Zambia is comprised of 14 projects with a total commitment of $1.4 billion and Trust Funds of about $150million. Health accounts for about 18.5 % of the World Bank portfolio and Social Protection (about 18%), followed by Education (13%), Transport (13%) and Environment (12%).

International Finance Corporation (IFC)

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)

MIGA also is providing support for Zambia’s development. MIGA guarantees in Zambia stands at around US$139million, covering projects in agribusiness, manufacturing, financial and energy sectors (see table below). These guarantees are expected to improve agriculture productivity, boost job creation, deepen financial inclusion and increase access to cleaner energy. In addition, the country is expected to benefit from MIGA’s guarantee of approximately EUR 359 million to cover Standard Chartered Bank (and other lenders) for their non-shareholder loan investments in the Eastern and Southern African Trade and Development Bank (TDB).

Regional Trade Facilitation 

Zambia has committed to implementing policy reforms to enhance regional trade. The country 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. 

The World Bank’s Response to COVID-19 in Zambia

Zambia’s location in Southern Africa — it is surrounded by eight countries — increases the risk of imported diseases from neighboring countries and beyond. This is because Zambia is a major trucking route for goods, both for import and export, as well as a destination and transit point for labor migrants, asylum seekers, illegal migrants, and victims of human trafficking in the region. 

The Bank is providing $25 million to support Zambia’s response to the COVID-19 pandemic. Of this amount, $20 million will come from Crisis Response Window resources, while $5 million is a grant from the Global Financing Facility for Women, Children and Adolescents (GFF). The funds will be channeled through the Zambia COVID-19 Emergency Response and Health Systems Preparedness Project. 

COVID-19 Vaccine Rollout 

The World Bank has successfully contributed to Zambia’s COVID-19 vaccination efforts by providing additional financing in the amount of $24 million ($14 million IDA credit co-financed with a $10 million grant from GFF). The financing will enable affordable and equitable access to COVID-19 vaccines and help ensure effective vaccine deployment in Zambia, including supporting strengthening the vaccination system in the country. 

Last Updated: Apr 17, 2022

The 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 center is facilitating laboratories compliance with regionally harmonized standard operating procedures for surveillance of Multi-Drug Resistant Tuberculosis (MDR-TB) case notification.  

The Africa CDC Regional Investment Financing Project in the amount of the US$90million IDA credit aims to strengthen public health and response systems in Zambia as well as the Southern Africa subregion to improve national and regional health security. The support is part of the regional support to Africa CDC to strengthen continental and regional infectious disease detection and response systems on the African continent. The project was approved on December 10, 2019. 

The Girls’ Education and Women’s Empowerment and Livelihoods (GEWEL) Project, with a current total of US$347 million over the period 2016-2024 (US$312 million IDA, and $35 million TF grants from FCDO, SIDA and Irish Aid). GEWEL is a "cash plus" intervention whereby productive inclusion and women, and girl's empowerment components are layered over the social safety net:    

• The project has so far benefited 75,000 women with a package consisting of life and business skills training, a productive grant of US$225. Early results from the randomized control trial impact evaluation of Supporting Women Livelihood (SWL) show that the productive grant has significant positive impact on household food security, profits, savings, income, diversification, and happiness.
• Through the Keeping Girls in School (KGS) Component, over 58,000 girls from the poorest households have benefited to date from bursary support covering their secondary school education costs aimed at reducing their rate of drop out from school. As school fees have recently been abolished in Zambia, the project has been restructured to utilize the savings to address the other barriers which lead adolescent girls to drop out from school and expand the target number of girls to 80,000. Namely, these activities include providing an education grant for other school necessities such as uniform, shoes and books; rolling out a case management system to support girls at risk of dropping out; and initiating school clubs that increase awareness among students as well as parents on issues of gender norms, sexual and reproductive health and GBV.
• GEWEL also provides direct financing to the Social Cash Transfer (SCT) which has allowed for more timely and predictable payments to beneficiaries in 2021 and a scale up to support over 973,000 SCT households, with a plan to support over a million households in 2022 (nearly 30% of the population and 50% of the poor). Previous impact evaluations of the SCT have shown positive impacts on household food security, expenditure on health and education, and agricultural productivity. World Bank simulations also show that the expansion of the SCT in 2021 and the increase in the transfer value is expected to have reduced poverty in Zambia by 6% points.

The 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 center is facilitating laboratories compliance with regionally harmonized standard operating procedures for surveillance of Multi-Drug Resistant Tuberculosis (MDR-TB) case notification. 

Energy

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. 

Climate Resilience

The Strengthening Climate Resilience Project has provided support in strengthening Zambia’s institutional framework for climate resilience and improve the adaptive capacity of vulnerable communities in the Barotse sub-basin. Specifically, the project has supported: 

• Mainstreaming of climate risk consideration into the Communal Development Plans (CDPs), 14 Districts Integrated Development Plans and 16 Ward Development Plans. All this influenced the mainstreaming of climate risk consideration in the National Development Plan and the subsequent development and approval of a National Climate Change Policy, which was approved on April 26, 2016. 
• The design and equipping of the National Emergency Operation Centre (NEOC) in Disaster Management and Mitigation Unit, significantly contributed to the government’s ability to monitor and respond in real time to the COVID emergency. 
• Thirty-four secondary and tertiary canals have been rehabilitated, providing additional land to more than 2,000 households to grow crops such as rice, winter maize, vegetables, sweet potatoes, cassava, sorghum, and millet 
• 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.  
• Support to strengthen climate change related research in the country the project has supported 16 Zambians in their post-graduate research to help in identification of climate change response and adaptation solutions. 
• The Transforming Landscapes for Resilience Development (TRALARD) Project in Zambia is building on lessons from the PPCR’s success and seeking to replicate it at scale in three provinces of Zambia namely Luapula, Muchinga and Northern. The project is proof that effective adaptation to climate change requires behavioral change, through better and targeted climate information and awareness. 

Last Updated: Apr 17, 2022

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 the government’s development efforts.

The World Bank Group

World Bank support to Zambia commenced in 1955, well before it attained its independence in 1964.

As of February 2022, the World Bank portfolio in Zambia has 14 national IDA projects- with total net commitments of about US$1.4 billion. In addition, there are four regional projects (total net commitment of US$222 million), and Trust Funds of about US$150 million. The portfolio is focused on social protection, health, education, transport, and the environment. Other sectors covered are agriculture, water, energy, and trade.

IFC has a resident representative in the Lusaka Country Office. 

Last Updated: Apr 17, 2022