2014年-世界发展银行全球_Zambia_Economic_Brief_June_2014___Promoting_Trade_and_Competitiveness_-_What_Can_Zambia_Do__69页_1mb

Summary of Zambia Economic Brief: Promoting Trade & Competitiveness

Core Content

This Zambia Economic Brief (2014) focuses on promoting trade and competitiveness in Zambia, highlighting the need for structural reforms to support sustainable economic growth and diversification. It provides an overview of recent economic developments, evaluates the performance of trade and competitiveness, and outlines policy implications and opportunities for improvement.

Main Points

1. Recent Economic Developments

• Growth: Zambia's GDP growth rate was 6.4% in 2013, slightly lower than the 7.3% in 2012.
• Sector Performance:
  • Agriculture output declined by 15.4% in 2013 due to reduced maize and cotton production.
  • Mining production rebounded after two years of decline, driven by the opening of the Lubambe mine and increased output at Mulyashi.
  • Services grew by over 8%, mainly due to government services.
• Rebasing of National Accounts: The Zambian economy was revalued to 2010, showing that 2010 GDP is 25% higher than the 1994-based estimate. This reflects better coverage of the informal sector, which is largely in the services sector.
• GDP Composition:
  • Tertiary sector: 53.7%
  • Manufacturing: 7.9%
  • Agriculture: 9.9%
  • Mining: 12.9%
• Inflation: Stayed within single digits in 2013, at 7.0% (down from 6.6% in 2012), but nonfood inflation was a key driver.
• Policy Rate: The Bank of Zambia increased the policy rate from 9.25% in 2013 to 12% by April 2014, to control inflation.
• Fiscal Deficit: Deteriorated significantly, reaching K8.2 billion (6.8% of GDP) against a budgeted deficit of 4.3%. Including liabilities like arrears and guarantees, the fiscal deficit was 8.7% of GDP.
• Debt Financing: The government used domestic financing and bridge loans to cover the deficit, with net domestic financing at 4.7% of GDP (up from 1.5%).

2. Trade and Competitiveness

• Trade Growth: Zambia's trade has grown significantly over the past decade, and its share of regional and global exports has increased.
• Non-Copper Exports: These have grown briskly, with agricultural exports showing potential for further expansion.
• Export Firms and Products: The number of exporting firms and products has increased, but survival rates are low.
• Trade Costs: High border clearance times and regulatory compliance costs remain a major constraint, especially for small traders and informal trade.
• Competitiveness Gaps:
  • Agriculture: High regulatory costs and unpredictable trade policies (especially regarding the FRA) discourage export-oriented production.
  • Mining Sector: Despite a large number of suppliers, the local mining supply cluster lacks value-added content and has low capital and skill intensity.
• Opportunities for Growth:
  • Zambia can become a major food exporter to Eastern and Southern Africa.
  • It has potential to develop as a regional logistics hub.
  • Value addition in the mining sector could improve competitiveness.
  • Services exports can be expanded, particularly in professional services.

3. Policy Implications and Recommendations

• Reduce Trade Costs: Streamline customs procedures, eliminate unnecessary regulations, and improve border infrastructure.
• Strengthen Trade Policy Predictability: Ensure a stable and transparent framework for agricultural exports, especially maize.
• Reform Subsidies: Redirect savings from farm input subsidies (e.g., FISP, FRA) toward long-term competitiveness improvements.
• Develop Local Mining Supply Cluster: Encourage technological upgrades, skill development, and capital investment in local suppliers.
• Leverage WTO Trade Facilitation Agreement: Use the agreement to harmonize border procedures and reduce costs.
• Promote Institutional Partnerships: Collaborate with mining companies and local suppliers to develop a local content strategy.
• Manage Fiscal Deficit: Implement fiscal consolidation to reduce the deficit and avoid crowding out private sector credit.

Key Information

• Challenges:
  • Declining copper prices.
  • Fiscal deficit is growing, driven by subsidy overruns, wage bill, and revenue shortfalls.
  • High borrowing costs and financial market volatility due to global monetary policy shifts.
• Opportunities:
  • Agricultural exports can grow if trade costs are reduced and policies are predictable.
  • Services exports, particularly professional services, offer growth potential.
  • Mining-related local supply cluster can be developed for long-term competitiveness.
• Constraints:
  • High regulatory costs.
  • Unpredictable trade policies.
  • High input subsidies that distort resource allocation.
• Strategies:
  • Reform trade and regulatory procedures.
  • Streamline fiscal spending and improve public investment.
  • Strengthen institutional frameworks to support private sector participation.

Annex Highlights

• Annex A: Provides economic data including GDP growth and government finances.
• Annex B: Analyzes firm-level trade transactions, showing trends in export volumes and survival rates.
• Annex C: Focuses on Zambia's competitiveness in maize production, highlighting the need for policy stability.
• Annex D: Examines the global copper value chain, emphasizing the role of local suppliers.
• Annex E: Discusses institutional design for a mining services supply cluster.

Conclusion

Zambia has the potential to grow faster and diversify its economy by leveraging its copper resources, arable land, and water supply. However, this requires reforms in trade facilitation, predictable trade policies, and fiscal discipline. The government must prioritize reducing trade costs, streamlining subsidies, and improving governance in the mining and agricultural sectors to support sustainable development and private sector growth.