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  • African PlatformZambia

     

    Country information

    Zambia’s economic performance improved in 2004 with real Gross Domestic Product (GDP) growth estimated at 5.0% from 4.9% in 2002. This was driven by strong expansion in mineral and agricultural production as well as generally favourable external sector conditions. The local currency (Zambian Kwacha remained stable against the United States dollar, while interests rates edged downwards. The average annual inflation also declined in 2004.
    Country Size: 750,000 Km2
    Population: 11 million
    Currency: Zambian Kwacha (ZmK)
    Languages: English
    Capital City: Lusaka
    GDP (US$): 352 Million
    Main Economic Sectors: Agriculture, tourism, manufacturing and mining
    Main Exports: Non Traditional Exports mainly wet blue leather, finished leather, skins (crocodile), high value crops, copper, cobalt, electricity, tobacco, flowers, cotton
    Main Imports: Textile, processed meats, milk and hardware. machinery, transportation equipment, petroleum products, electricity, fertilizer; foodstuffs
    Industry (Main Industries): Agriculture, tourism, mining, and manufacturing
    Natural Resources: Zambia has abundant natural resources which include 42 million hectares of arable land out of which only 14% is under cultivation; adequate underground water, rivers, dams and lakes to irrigate 500,000 hectares of which only 65,000 hectares  (13%) is developed; and  vast grasslands and forests for timber and honey production. The country has also abundant sunshine with enough rainfall ranging from 650mm to 1,800mm per annum suited for the production of a wide range of crops, livestock, fish, timber and honey.

    Agriculture

    (Main Products):

    		 Livestock products (beef, poultry, eggs, pork, milk) and crops (maize, soybeans, Virginia / burley tobacco, mixed beans, groundnuts, cotton, sunflower, irrigated wheat, assorted vegetables); and floriculture products.
    International Organization Member: ACP, AFDB, AU, C, FAO, G-77, IAEA, IBRD, ICAO, ICCT, ICFTU, ICRM, IDA, IFAD, IFC, IFRCS, ILO, IMF, Interpol, IOC, IOM, ISO (correspondent), ITU, MIGA, MONUC, NAM, ONUB, OPCW, PCA, SADC, UN, UNAMSIL, UNCTAD, UNESCO, UNHCR, UNIDO, UNMEE, UNMIK, UNMIL, UNOCI, UPU, WCL, WCO, WHO, WIPO, WMO, WTO, WTO
    Infrastructure: The Republic of Zambia is a land locked country and it borders eight countries, namely Zimbabwe, Namibia, Botswana, Mozambique, Malawi, Tanzania, the Democratic Republic of Congo and Angola. Zambia is connected to these countries by good international transport and road network, railway system, three airports and telecommunication network.

    Livestock

    Cattle Population: 2,500,000
    Sheep Population: 90,000
    Goat Population: 1,000,000
    Cattle Off Take Rates: 8%
    Sheep Off Take Rates: 20%
    Goat Off Take Rates: 35-40%
    Livestock Policy: The livestock policy aims at conservation of indigenous breeds; improving the productive efficiency of livestock; disease control (vaccination of cattle against Foot and Mouth Disease (FMD), Contagious Bovine Pleural Pneumonia (CBPP) and control of East Coast Fever (ECF)/Corridor Disease); promoting good and hygienic practices in meat processing; facilitating the efficient marketing of livestock, livestock products and livestock by-products and promoting investment in the livestock industry.
    Slaughter Facilities: 8: commercial abattoirs
    15: slaughterhouse
    > 250: slaughter slabs

    Industry profile

    Hides and skins

    Tanning

    Footwear

    Leather goods

    SWOT analysis

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     Hides and skins

    Quantity Hides: 180,000
    Quantity Goat: 100,000
    Annual Collection Level Hides: 90%
    Annual Collection Level Goat: 90%
    Flaying Methods: Both machine and hand flaying. But hand flaying is more prominent.
    Preservation Methods: Most hides are preserved by salting. Some hides are preserved by chilling and biocidal.
    Grading Systems, available grades and percentage of Each: Grade I: 21%
    Grade II: 42%
    Grade III: 24%
    Grade IV: 7%
    Rejects: 6%
    Hides & skins trade channels: Through South Africa, Tanzania and Malawi.
    Market (%): 90% hides: export
    10% hides: local markets
    Annual Export Value (US$): US$ 6 million (2003)
    Average market Bovine price: US$ 0.80 - 1.40 / Sqft (local market)
    Average market Goat price: US$ 0.80 - 1.40 / Sqft (local market)

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     Tanning

    Number of Tanneries: 5
    Installed tanning capacity: 1,500 hides per day (wet blue)
    2,000 hides per day (finished leather)
    Tanneries in Operation: 4
    Utilized capacity: 40%
    Output of the industry: Wet blue: 90%
    Crust: 2%
    Finished: 8%
    Number of employees: 420
    Market (%): 90% export
    Major Markets: China, Europe, Central Africa.
    Estimated Annual Export Value (US$): US$ 7 million (2003)

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     Footwear

    Number of Footwear Factories: 5
    In Operation: 3
    Manufacturing capacity: 10,000 pairs /day (Installed capacity)
    30% utilized capacity
    Number of employees: 1,500
    Market (%): 80% export
    20% local market
    Major Markets: Congo DR, Malawi, Zimbabwe
    Estimated Annual Export Value (US$): 414,090 (Estimated - 2000)

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     Leather goods

    Number of Leather Goods and Garment Factories: 2
    In Operation: 2
    Number of employees: 800
    Market (%): 100% local

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     SWOT analysis

    Strengths: Abundant raw materials especially hides and skins.
    Weaknesses: 1. Lack of access to low cost finance.
    2. High interest rates on loans makes borrowing prohibitive.
    3. High freight costs to markets.
    4. Exports of non- value added raw hides and skins create a shortage for the tanneries.
    5. Imports of second hand shoes and other leather items create stiff competition on the market for manufacturers of finished products.
    6. Lack of a research institute to spearhead research so that tanneries are able to cope with increasing demands for top quality leather products.
    Opportunities: Great potential for investment and expansion of leather industry. It can be said that the leather and crocodile industry could earn significant foreign exchange for the country and also offer employment to a reasonable proportion of Zambians.
    Threats: Illegal /smuggling of raw hides and skins.

    Government policy

    Fiscal Policies: Zambia encourages and promotes exports of products and to make these products competitive at regional and international markets , the following fiscal policies have been put in place.

    VAT: VAT is standard rated at 17.5% for products marketed within the country and is zero rated for exported goods.

    Levies: Export duty is not applicable on goods for export. Therefore no export duty is charged on exported leather and leather products.

    Corporate taxation: Normal corporation tax applies at 35%  on profit and 15% for Non Traditional Exports.

    Ministry of Finance and National Planning is responsible fiscal policies in the country.  website: www.mofnp.gov.zm
    Monetary Regulations: The Bank of Zambia was enacted by the Parliament in 1985 under Bank Act No.24 of the laws of Zambia (as amended, Bank of Zambia Act No. 43 of 1996). The statutory functions of the Bank of Zambia include but not limited to the following:
    • Formulate and implement monetary and supervisory policies in order to promote macro-economic development.  
    • Licence, supervise and regulate the activities of the banks and financial institutions so as to promote the safe, sound and efficient operations and development of the financial system (The Banking and Financial Services Act No. 387 of the Laws of Zambia)
    • Support the efficient operation of the exchange system.

    The Statutory Instrument No. 44 of 1994, Bank of Zambia (Foreign Currency) Regulations of 1994 suspended the Foreign Exchange Controls, implying that individuals or companies are free to bring into the country and take out unrestricted amounts of money. This provides conducive financial environment for investment, marketing and trade.
    Trade regulations: Zambia liberalised its trade regime with the aim of simplifying the national trade regime, stimulating economic diversification and promoting export led growth. Zambia is a member of World Trade Organisation (WTO, Common Market for Eastern and Southern Africa (COMESA) and is a signatory to the SADC protocol.

    The requirements for export or import of products are : Application for an agricultural export or import permit, veterinary health certificate and phyto-sanitary certificate form Ministry of Agriculture and Cooperatives, P.O Box 197. Lusaka, Zambia. However, export of raw hides and skins is not allowed but wet blue and beyond.

    Investment environment

    Requirements For Foreign Investment / Joint ventures:
    • Incorporate a company in Zambia
    • Official list of shareholders/directors
    • Minimum capital of US$50,000 per shareholder for a new company or US$35,000 for an existing company
    • Business plan/feasibility study
    • Proof of finance
    • Secondary licence
     
    Tax Incentives:
    • Income received from farming charged at 15% corporate tax
    • 50% depreciation for machinery used for farming
    • 20% capital expenditure allowance per year for five years on farm improvement
    • 10% development allowance for the first year of production
    • 100% farm work allowance on farmland expenditure such as stumping, clearing, soil erosion prevention, sinking boreholes, wells, water conservation and aerial/geophysical surveys
    • Dividends received from farming are tax free for the first five years of operation
    • Customs duty exemptions on most capital machinery and equipment for agriculture
    • Reduced duty/duty free on imports of certain raw materials
    • Import VAT deferment on eligible plant/machinery and raw materials
     
    Free Trade Zones: Zambia is a member state to COMESA Free Trade Area and SADC region with a combined market of over 600 million people.

    Institutional support

    Institute Name
    Leather Industry Association of Zambia (LIAZ)
    Export Board of Zambia
    Department of Veterinary and Livestock Development
    Zambia Wildlife Authority
    Ministry of Commerce, Trade and Industry
    Zambia Bureau of Standards
    Zambia Investment Centre
    Environment Council of Zambia
    Zambia Crocodile Farmers Association

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     Leather Industry Association of Zambia (LIAZ)

    Contact Name: Chris Spyron
    Job Title: Chairman
    Address : Plot No. 2151/4782, Mumbwa Road
    P.O.Box: 32922    
    City: Lusaka
    Country: Zambia
    Phone: 260-1-286 053    
    Fax: 260-1-286 053    
    Email: liazcfc@zamnet.zm
    Activity:
     Association  
    Presentation of the institute: The Leather Industries Association of Zambia is registered body under the Registrar Society Act LIAZ has a membership of five (5) tanneries and 5 leather manufacturing companies. The functions of LIAZ are to lobby with the Government for better policies in order to enhance sustainable production of good quality hides / skins, wet blue/ finished leather and leather goods; and marketing/trade. The association also endeavours to promote, amongst its members, sustainable technologies at all levels in the value chain addition and production processes.

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     Export Board of Zambia 

    Contact Name: Glyne Michelo
    Job Title: Executive Director
    Address 1: Ground Wing and First Floor
    Address 2: Kwacha House Annex, Northend Cairo Road
    P.O.Box: 30064    
    City: Lusaka
    Country: Zambia
    Phone1: 260-1-228 106 Phone2: 260-1-224 790
    Fax: 260-1-222 509    
    Email: ebzint@zamnet.zm / ebztid@zamnet.zm
    Website: http://www.ebz.co.zm
    Activity:
     Other Government body  
    Presentation of the institute: Statutory body established by the Export Development Act 1985. (as amended by Act No.9  1994) objective of promoting, developing and encouraging export of non-traditional goods from Zambia. Functions include:
    • Collecting collating and disseminating trade information, relating to existing and potential markets.
    • Providing technical know-how and specialised assistance on quality, supply and pricing.
    • Recommending for approval by the Board of Directors and relevant Government ministries policies relating to development, promotion and encouragement of export of goods and services.
    • Export trade promotion.
    • Recommending for approval of the Minister any such things that will help develop Zambia exports.

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     Department of Veterinary and Livestock Development

    Contact Name: Dr. Peter Sinyangwe
    Job Title: Director
    Address : Mulungushi House, Independence Avenue
    P.O.Box: 50060    
    City: Lusaka
    Country: Zambia
    Phone: 260-1-250 274    
    Fax: 260-1-252 608    
    Email: pgsinyangwe@maff.gov.zm / aphhq@zamnet.zm
    Activity:
     Other Government body  
    Presentation of the institute: The Department of Veterinary and Livestock Development is responsible for regulation and monitoring of all livestock related production and processing ventures in the country; disease control and issuance of animal health certificates for the export of livestock, livestock products and livestock by-products. The Department also works in collaboration with other line ministries to ensure quality production of marketable livestock, livestock products and livestock by- products and development livestock standards.

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     Zambia Wildlife Authority

    Contact Name: Hapenga M. Kabeta
    Job Title: General Director
    Institute Name: Zambia Wildlife Authority
    Address : Chilanga
    City: Lusaka
    Country: Zambia
    Phone1: 260-1-278 524 Phone2: 260-1-278 366
    Fax: 260-1-278 299    
    Email: zawa.org@zamnet.zm
    Website: http://www.zambianwildlife.org.zm
    Activity:
     Other Government body  
    Presentation of the institute: Zambia Wildlife Authority was established by an act of Parliament in November 1999, Statutory Functions:
    • Regulate, control and manage Zambia's wildlife estate
    • Enhance economic and social well-being of local communities in Game Management Areas
    • Manage Game Management Areas in partnership with local communities and grant hunting concessions to hunting outfitters and photographic tour operators.
    • Issue various licences and permits (such as Export / Import permits, hunting licences, to keep animals in captivity, certificate of ownership of live animals and trophies, etc.) under the Zambia Wildlife Act (Section 5,Zambia Wildlife Act No. 12 of 1998)

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     Ministry of Commerce, Trade and Industry

    Contact Name: Mrs. Dorothy Tembo
    Job Title: Director
    Address : Governement complex, Independance Road
    P.O.Box: 31968    
    City: Lusaka
    Country: Zambia
    Phone1: 260-1-224 115 Phone2: 260-96-627 091
    Fax: 260-1-224 115    
    Email: dorothytembo@yahoo.com / dorothytembo@hotmail.com
    Website: http://www.mcti.gov.zm
    Activity:
     Ministries  
    Presentation of the institute: The Ministry of Commerce, Trade and Industry serves as the primary government institution overseeing trade and industrial policy. The Ministry is structured into four departments comprising: Department of Foreign Trade (responsible for external trade relations), Department of Domestic Trade (which oversees domestic trade policies), Department of Industry and a Department for Planning. The Ministry also oversees activities of various statutory bodies responsible for trade-related issues in Zambia. Potential business investors seeking additional information may also direct enquiries to the Permanent Secretary, Ministry of Commerce, Government Complex, Kamwala, LUSAKA.

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     Zambia Bureau of Standards

    Contact Name: Mataa Mukelabai
    Job Title: Director
    Address : Lechwe House, Freedom Way Southend
    P.O.Box: 50259    
    City: Lusaka
    Country: Zambia
    Phone1: 260-1-231 385 Phone2: 260-1-227 075
    Fax: 260-1-238 483    
    Email: zabs@zamnet.zm / infozabs@zamnet.zm
    Activity:
     Other Government body  
    Presentation of the institute: Zambia Bureau Standards (ZABS) is the national standards body responsible for formulation of national standards. Other services offered include certification, metrology, import quality monitoring, training and consultancy. ZABS has published just over 450 standards for the food, construction, petroleum, agriculture, energy and textile industries. Training in quality management systems is also provided. ZABS is currently a correspondent member of ISO (International Organisation for Standardisation).

    Zambia Bureau Standards is the inquiry point for World Trade Organisation (WTO) inquiries on Technical Barrier to Trade issues and also serves as a National Accreditation Focal Point.

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     Zambia Investment Centre

    Contact Name: Mr. Jacob Lushinga
    Job Title: Director General
    Address 1: Investment House
    Address 2: 6457 Los Angels Boulevard, Longacres
    P.O.Box: 34580 Zip: 10101
    City: Zambia
    Country: Zambia
    Phone: 260-01-254 214    
    Fax: 260-01-252 150    
    Email: invest@zamnet.zm
    Website: http://www.zic.org.zm
    Activity:
     Other Government body  
    Presentation of the institute: Zambia Investment Centre is a statutory body that was established by an act of parliament to promote, facilitate both local and foreign investment and co-ordinate Government policies on investment in Zambia

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     Environment Council of Zambia

    Contact Name: Justin Mukosa
    Job Title: Senior Communications Officer
    Address 1: Plot N°6975
    Address 2: Corner Church and Suez Road, Ridgeway
    P.O.Box: 351331 Zip: 10101
    City: Lusaka
    Country: Zambia
    Phone1: 260-01-254 130 Phone2: 260-01-254 023
    Fax: 260-01-254 164    
    Email: administrator@necz.org.zm
    Website: http://www.necz.org.zm
    Activity:
     Other Government body  
    Presentation of the institute: The Environmental Council of Zambia (ECZ) was established as an autonomous body through the enactment of the Environmental Protection and Pollution Control Act (EPPCA) No. 12 of 1990 (CAP 204 of the Laws of Zambia) which prescribes the functions and powers of the ECZ as a corporate body. The Environmental Council of Zambia mandate is to regulate and co-ordinate environmental management, promote awareness and ensure environmental protection through enforcement of regulations and the prevention and control of pollution in support of sustainable development, so as to provide for health and welfare of persons, animals, plants and environment in Zambia.

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     Zambia Crocodile Farmers Association

    Contact Name: S.M. Deasi
    Job Title: Chairman
    Address : 3141 Buyantanshi Road
    P.O.Box: 34837 Zip: 10101
    City: Lusaka
    Country: Zambia
    Phone1: 260-1-242 735 Phone2: 260-1-242 718
    Fax: 260 -1-242 718    
    Email: hom@zamnet.zm
    Activity:
     Association  
    Presentation of the institute: The Zambia Crocodile Farmers Association was established in 2003 and currently there are nine (9) crocodile farms, some of which have been in existence for more than 25 years. The crocodile species farmed is Niloticus.
    The total annual production at present is 50,000 skins and the export value is around US$6 million. Some farms are also in the process of setting up facilities to export crocodile meat. The Zambia Crocodile Farmers Association has approximately 1000 workers. The Association plays the role of a facilitator and representative on behalf of members. The Association also handles business inquiries on behalf of members.

    Trade statistics in 2004

    Products

    Exports (quantity)

    Exports ( in USD)

    Imports (quantity)

    Imports (in USD)

    Wet blue

    3 million sqft

    2 million

    negligible

     

    Chemicals

     

     

    200 metric tonnes

    380,000

    Technical cooperation projects

    Commercialisation of Hides and Skins by Improving Collection and Quality in the Smallholder Farming Systems

    Duration: 6 years
    Status: Completed
    Description: Zambia has abundant hides and skins but 40% and 80% of these raw materials respectively, are not collected or are not available to the tanneries. Also the quality of hides and skins, especially from the traditional sector, is poor. Therefore, most hides and skins are wasted and not available to the tanneries. The project, therefore, aims at improving the collection and quality of hides and skins by sensitising farmers on their economic value and importance; training extension workers and farmers on the correct flaying and preservation methods; distribution of correct flaying and lifting devices; rehabilitation and construction of hides and skins preservation structures; and establishment of hides and skins marketing system.

    Surveys and reports

    Subregional trade expansion in Southern Africa supply survey on Zambia’s leather and leather products

    Corporate Author(s): Export Board of Zambia
    Year of Publication: 2001
    Number of pages: 44
    Language(s): English
    Abstract: The supply study covers leather and leather products. The different types of leather covered includes cattle hides and skins, crocodile skins, crust leather, finished leather (which includes footwear and leather goods) and leather uppers (upper part of the shoe). These products have been classified according to the Harmonised System (HS) of coding, which Zambia uses for product identification and for customs purposes, as indicated below.
    Publisher: Export Board of Zambia
    Type of Document/Material: PDF Downloadable document

    Company profiles

    Company Name Products
    Bimzi Ltd Belts - Jackets - Coats - Small Leather Goods
    Kabwe Tannery Ltd Footwear - Upper leather - Industrial Gloves - Other - Split Leather - Upholstery leather - Wet Blue
    Kembe Estates Ltd Chrome crust - Footwear - Upper leather - Garment Leather - Industrial Leather - Leathergoods Leather - Pickled - Saddlery and Harness Leather - Upholstery leather - Vegetable crust - Wet blue
    King Quality Meat Products Ltd Chrome crust - Footwear - Lining leather - Footwear - Upper leather - Gloving Leather - Industrial Leather - Wet Blue
    ZamBeef Products Plc Footwear - Lining leather - Footwear - Upper leather - Gloving Leather - Military - Other - Safety - Upholstery leather - Wet Blue
    Zambia Bata Shoe Company Plc Children's shoes - Military - Safety

    Environment and social responsibility

    Environment

    Legislation:

    		 The Environmental Council of Zambia (ECZ) was established as an autonomous body through the enactment of the Environmental Protection and Pollution Control Act (EPPCA) No. 12 of 1990 (CAP 204 of the Laws of Zambia). The EPPCA is the supreme environmental law of Zambia it prescribes the functions and powers of the ECZ as a corporate body. The Environmental Council of Zambia mandate is to regulate and co-ordinate environmental management, promote awareness and ensure environmental protection through enforcement of regulations and the prevention and control of pollution in support of sustainable development, so as to provide for health and welfare of persons, animals, plants and environment in Zambia.
    Labour Laws: Ministry of Labour and Social Security administers two labour laws. The first one is Employment of Young Persons and Children's ACT, CAP 274 of the Laws of Zambia. To enhance this law there is a Draft Policy on Child Labour in conformity with the International Labour Organisation (ILO) convention on child labour. The second law is the Factories ACT, CAP 441 of the Laws of Zambia. This ACT ensures safety and protection of workers against any forms of injury (physical, chemical and emissions). The ACT also provides a conducive working environment (provision of protective clothing or uniforms; cleanliness of factory and its surroundings) for workers in factories or processing plants. Departments of Labour and Occupational Safety and Heath Services in the Ministry of Labour and Social Security are responsible for promoting and enforcement of the Labour Laws in Zambia.
    Other: Poverty Reduction Strategy Programme:

    Poverty levels in Zambia are estimated at 86%. Rural people, women and children are more affected. To mitigate the effects of poverty, Zambia put in place Poverty Reduction Strategy Programme (2000- 2004). This programme ensures employment creation and income generation through commercialisation of agricultural programmes in the Smallholder Farming Systems. Some of the resources have been channelled to infrastructure (agricultural feeder roads, boreholes and wells) rehabilitation; Education and Heath sectors to ensure quality service provision. Because of good performance in the Poverty Reduction Strategy Programme, Zambia successfully completed the HIPC Completion Point in 2005. Cabinet Office, under the office of the Vice President is responsible for coordinating the Poverty Reduction Strategy Programme in the country.
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