80
Investment & Legal Framework
• Certificate of ,ncorporation
• /and sNetch
• /etter of consent from the land’s chief
• 5ecommendation letter from the local council
FOREIGN CURRENCY
While money can easily be exchanged in the main
cities throughout the country, payments may only
be made in Kwachas, even if the price is quoted in
USD. After clearing immigration at the airport, for-
eign currency will not be accepted.
As long as foreign currency has been declared on
arrival through a currency declaration form, there is
no limit on currency importations.
CONSIDERATIONS&INCENTIVES
The Zambia Development Agency (ZDA) Act of
2006 offers a wide range of incentives in the form of
allowances, exemptions, and concessions for com-
panies. The act provides investment thresholds that
investors must meet in order to qualify for fiscal and
non-fiscal incentives. Investors can be divided into
five categories as described by the ZDA Act. There
are a number of general incentives for investors,
but depending on an investor’s categorization, he
or she may be entitled to more.
1
.
Inv
estors that inv
est 1
0
mil
l
ion USD or more
in an identified sector or product.
This category of investors is entitled to negotiate
with the government for additional incentives.
2
.
Inv
estors that inv
est 5
0
0
,
0
0
0
USD or more
into the Mul
ti Facil
ity
Economic Zones (
MFEZ)
and /
or in a sector or product of a priority
sector
or a priority
product under the ZDA Act.
This category, in addition to being entitled to the
general incentives, is entitled to the following incen-
tives:
•Zero percent ta[ rate on dividends for five \ears
from year of first declaration of dividends.
•Zero percent ta[ on profits for five \ears from the
first year profits are made. For year 6 to 8, only
50 percent of profits are taxable and years 9 &
10, only 75 percent of profits are taxable.
•Zero percent import dut\ rate on raw materials,
capital goods, and machinery, including trucks
and specialized motor vehicles for five years.
•'eferment of 9$T on machiner\ and eTuipment
including trucks and specialized motor vehicles.
3
.
Micro or smal
l
enterprises
Like the second category, this category is also, in
addition to the applicable general incentives, en-
titled to the following incentives:
• For an enterprise in an urban area, their income is
exempt from being taxed for the first three years.
• For an enterprise in a rural area, their income is
exempt from tax for the first five years.
4
.
Inv
estors that inv
est l
ess than 5
0
0
,
0
0
0
USD
in a sector or product identified w
ithin a prior-
ity
sector or considered to be a priority
product
under the ZDA Act.
This category is only entitled to general incentives.
5
.
Inv
estors that inv
est any
amount in a sector
or outside of w
hat is considered a ZDA priority
sector.
This category of investors is only entitled to gen-
eral incentives provided under the various pieces
of legislation.
MISCELLANEOUS MATTERS
In spite of the economy’s robust performance, the
country is still faced with challenges, including the
need to generate more employment opportunities
and to raise incomes. To address these challenges
and achieve the country’s long-term vision of be-
coming a prosperous middle-income country by
2030, the government has implemented the Sixth
National Development Plan. The plan’s primary fo-
cus is on infrastructure development in an effort to
accelerate economic diversification.
The diversification program is intended to achieve
broad, sustainable growth is able to generate em-
ployment opportunities. In this regard, priority has
been placed on the non-mining sectors of agricul-
ture, energy, manufacturing, tourism, and transport
to provide alternative sources of growth and em-
ployment.
Ag
ricul
ture
In agriculture, the focus is on enhancing produc-
tivity by extending services and controlling and
managing livestock diseases and farmer input sup-
port. Other measures being undertaken include the
