How can Zambia boost growth and jobs?

One of the biggest challenges in building a jobs programme is understanding why job growth is not happening. Take Zambia as an example. It has many of the fundamentals right. There is political stability and an economy that has grown by over 7% a year for more than a decade. It has wonderful natural resources, including abundant land and water, and it is rich in commodities, especially copper. It has attracted major international companies, such as Parmalat, Lafarge and Airtel that are selling their goods and services both domestically and regionally. And yet, the country still suffers from 62% poverty and job growth that is not keeping pace with population growth.

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Since we know globally, on average, that growth is good for the poor, why are two thirds of Zambians being left behind in the growth process? The Let’s Work Partnership has designated Zambia to be one of its first Country Pilots, aiming to work with the Government of Zambia to implement its `jobs and economic transformation strategy’.  We are looking at the linkages between different parts of the economy to see if gaps or blockages are preventing job growth and labor productivity growth for the self-employed. These are public good linkages between the government and private sector, out-grower style links between large international firms and smaller micro-enterprises, and value chain links between a strong export sector and a domestic logistics sector that gets exports to market. The challenge is to understand how we can make product, input, and factor markets in key growth sectors function more equitably, to generate more, better, and inclusive jobs. While there is no lack of value chain assessments in Zambia, a challenge is to bring a jobs lens to these value chains.

The Let’s Work Partnership comprises twenty-eight leading international finance institutions who have pledged to work together to address the issue of job creation, and learn from each other’s experiences. The partnership prioritizes, at the country and sector level, private sector activities with respect to jobs and will advance and refine methods for how to estimate job effects in this area.

The key driver of the jobs strategy is to understand opportunities for transformational investments needed in key sectors in order to create more jobs, improve job quality, and connect poor Zambians to job opportunities.

Opportunities  

One such sector is agriculture and agro processing. Zambia is becoming a significant food exporter in the sub-region. It enjoys an abundance of water, fertile land and a good climate for crop production, animal feed, dairy and livestock. Commercial farming of commodities, grain and livestock is expanding. And there is scope to link a growing number of smallholders to commercial farms and agro-processing firms through vertically integrated out-grower programs in areas such as cotton, tobacco and sugar, as well as other cash crops such as soya, maize, vegetables, milk and meats.

Although Zambia is landlocked, it has borders with eight other countries. This creates conditions for the country to become a major food trade hub for the sub region. There are opportunities for investment in the storage, trucking, warehousing and logistics industries, although these are challenged by the copper-induced strength of local currency.

Also, construction is booming. Part of this is due to the infrastructure needs of the copper mines, but it is also due to a housing shortage. Any future development of the tourism industry would also add to the growth of the sector.

It is opportunities such as these that the private-sector focused Let’s Work Partnership for jobs is looking to bolster. We are committed to finding ways to stimulate investment and advisory solutions in Zambia. This will lead to more, better, inclusive jobs and help the government implement its ambitious jobs agenda.

This post first appeared on The World Bank Jobs and Development Blog.

Publication does not imply endorsement of views by the World Economic Forum.

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Author: Sudha Bala Krishnan writes for World Bank. Dino Leonardo Merotto writes for World Bank. 

Image: Zimbabwean farm worker Lovemore Dzapasi harvests tobacco at Lobernvale farm in Harare. REUTERS/Philimon Bulawayo