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The Zambian Economy
Background
In the last few years, the Zambian economy has
performed strongly. The strong performance of the
economy is attributed to the reforms that the country
has been implementing since the early 1990s. With
the change in 1991 from the one party system to a
plural political system, the country embarked on a
social and economic journey that transformed Zam-
bia from a state dominated centralised system to an
open economy with a significantly reduced role of
the state.
The reforms of the 1990s included the abolition of
foreign exchange controls, the deregulation of inter-
est and foreign exchange, removal of price controls
and consumer subsidies, reform of land tenure, re-
duction of trade tariffs and embargoes to open up
domestic markets, privatisation of many state owned
enterprises and the strengthening of the financial
sector. In addition, the reforms provided for the stat-
utory protection of investments and the repatriation
of up to 100 percent of profit and dividends without
restriction.
The ultimate objective of the reforms of the 1990s
was to create an economic environment that enables
the private sector to thrive and become the engine
of investments, growth, employment creation and
poverty reduction.
Zambia is endowed with rich and abundant natural
resources. These resources include minerals, such
as base metals (copper, zinc, lead), precious met-
als (emeralds, amethyst, aquamarine, garnets, and
citrines), industrial minerals (iron) and energy pro-
ducing minerals (coal). Other resources that Zambia
also has in abundance include land, water resources
(both ground and surface water), and an impressive
network of wetlands, plentiful wildlife, and fish re-
sources, extensive forestry resources and a unique
and wide range of national heritage, all within a fa-
vourable sub-tropical climatic regime. The total land
surface area is relatively vast (752,000 square. km)
and the physical landscape is still of quality and
pristine, characterized by fascinating and varied
Barclays Bank Zambia head office
Zambian Amethyst
land systems and soil types. Total land suitable for
agriculture is estimated to be about 58 percent of
Zambia’s total land surface, and only an estimated
14 percent of this land is currently utilized.
With regard to wild life, the country is home to 19 Na-
tional Parks and 23 Game Management Areas that
provide a pristine and unspoilt habitat for a variety of
animal species. There are about 733 bird species,
150 species of reptiles, 404 species of fish and 224
species of mammals. Of these wildlife species, 25
species of mammals, 36 species of birds and 4 spe-
cies of reptiles have international significance and
are protected. In terms of area extent, wildlife pro-
tected areas occupy about 40 percent of the coun-
try’s land surface area. This gives Zambia one of the
largest wildlife estates in the sub-region.
The country also has scope for development of pri-
vate wildlife estates, as there is availability of land in
communal (open) areas. There are also over 3,000
sites of outstanding natural and cultural heritage with
a great diversity of attractions and unique features
such as the world renowned Victoria Falls.
With its location at the centre of the Common Mar-
ket for Eastern and Southern Africa (COMESA) and
Southern Africa Development Community (SADC)
regional markets and having 35-40 percent of the
water resources in the SADC region, Zambia has the
potential of becoming the bread basket of the region.
The abundance of water resources from rivers and
lakes also provides the country with vast potential
for development of hydro power generation capacity
that can cater for the ever increasing need for elec-
tric energy in the country and the region.