Zambia (view map)

Following independence in 1964 Zambia was widely thought to have the potential to be one of Africa’s richest countries. Today however, Zambia is one of the poorest countries on earth, with over two thirds of Zambians living on less than 50 pence per day with average life expectancy pegged at 37 years.

Located in central southern Africa, Zambia is a large landlocked country which is home to just over 11 million people. The country’s main exports are copper, minerals and tobacco.

Zambia suffered from prolonged droughts in the 1980s and 1990s and was hugely affected by the major southern African famine in 2002. A lack of agricultural training, resources and support along with poor infrastructure and disease has hindered the recovery of Zambia’s agricultural sector.

The Zambian economy is reliant on its main natural resource of copper. When copper prices collapsed in the mid 1970s it was forced to borrow huge sums of money from foreign lenders in order to keep its economy afloat. Despite the recent reduction in Zambia’s external debt burden from $7.1 billion to $0.5 billion, and a boom in copper prices, the desperate living conditions of many ordinary Zambians remains unchanged.

According to a recent SCIAF report, Undermining Development, Zambians were not seeing the benefits of increasing copper prices because foreign companies are extracting much of the profits from the industry. Zambia’s largest copper mining company, Konkola Copper Mines (KCM) - 79% owned by the London based Vedanta Resources - recorded profits in 2007 that were more than the Zambian government’s spending on health care and social protection combined. Zambia sees little of these profits as companies like KCM have enjoyed an effective marginal tax rate of 0% and pay mineral royalties of just 0.6%. This is set to change with a new tax regime introduced by the Zambian government in 2008. When implemented, this will see Zambia increase its income from its greatest natural resource by approximately $415 million in 2008 alone, which the government says, will help to fund health and education spending.

Poverty levels and food insecurity have been made worse by one of the world’s most devastating HIV/AIDS epidemics. One in five Zambians have HIV and over 98,000 people died of AIDS in 2005 alone. HIV/AIDS has wiped out much of Zambia’s workforce, leaving less and less people to work in the mines and harvest crops.

This reduction in productivity, especially in the agricultural sector where fewer hands means smaller harvests, is doing little to reverse Zambia’s desperate situation. Co-operation continues with international bodies on programs to reduce poverty, including a new lending arrangement with the IMF in the second quarter of 2004. A tighter monetary policy will help cut inflation, but Zambia still has serious problems with disease and high public debt.

SCIAF has been working with partners in Zambia since 1985, supporting agricultural and livelihood recovery work alongside areas of food security and advocacy.