Zambia

Zambia was a spearhead in the struggle against apartheid, and for more than fifty years has been a peaceful country in a turbulent part of the world. The country is highly dependent on international commodities prices.

Facts about Zambia

Population
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Millions
Life expectancy
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Years
GNI pr capita
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USD
Percentage poor people (below 1.25$)
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%
HDI
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Ranking
Source:

Bilateral assistance million kroner

Bilateral assistance million kroner

Bilateral assistance million kroner

Zambia became independent in 1964, and Norwegian development aid to the country commenced two years later. Zambia soon became a main partner country, and was one of the chief recipients of Norwegian aid through the 1980s and 1990s. Norwegian aid to Zambia was reduced after grants peaked in 2011, and in 2016 the Norwegian Embassy in the country was closed.

Development aid to Zambia commenced after Norwegian authorities, who wanted geographical concentration of aid, had already started to cooperate with the East African countries Tanzania, Kenya and Uganda.

Front-line state

President Kenneth Kaunda and his United National Independence Party (UNIP) led the country from the time of its liberation and right up to 1991. Zambia introduced a one-party system in 1972. Kaunda and UNIP pursued a nationalist socialist ideology. African solidarity against segregation and colonialism was important.

Zambia, Botswana and Tanzania were the three original frontline states, a group of independent African states that fronted the struggle against the white minority governments in Rhodesia (now Zimbabwe) and South Africa.
In the late 1970s, in particular, Norway placed great emphasis on displaying solidarity with the frontline states. Development aid to southern Africa became a central part of this policy.  Zambia bordered on Rhodesia, Namibia (which was under long-term occupation by South Africa) and both Mozambique and Angola. In the latter two countries, the armed struggle against the Portuguese colonial power continued until 1975. Zambia was a refuge for liberation movements from these countries. The struggle of the frontline states was crowned with victory when segregation policy was removed first in Zimbabwe (1980) and then in South Africa (1991).

Zambia was impacted economically by the conflicts in the neighbouring countries, but on the whole avoided being drawn directly into their wars. For the most part, the country also kept out of the wars that raged in several neighbouring countries in the late 1990s and 2000s.

Copper industry

Its vulnerability to fluctuations in global copper prices is a common thread running through Zambia's history. Copper from the mines in the Copper Belt province is by far the country’s most important export product. The copper market is international. Mining and refining are largely dominated by big, international companies.

The price of copper was high until the mid-1970s, and Zambia experienced solid economic growth. Then the price fell, and export revenue plunged. In the 1960s and 1970s, the government nationalised the copper mines through a gradual process that culminated in the establishment of the state mining giant Zambia Consolidated Copper Mines (ZCCM) in 1982. Inadequate investment in the state-owned mines led to lower production and even less revenue.
In the 1980s, the country sank deeper and deeper into an economic crisis. One reason for this was the failing export revenue from the copper mines. In addition, Zambia had taken on substantial debt. In the early 1980s, loans in USD were far more costly to service, a factor that helped to trigger a debt crisis. As an oil-importing country, Zambia was also hit by high oil prices.

Falling export revenue, costly debt and high oil prices also hit many other developing countries in the 1970s and 1980s, but the impact on Zambia was greater than in many other places. The International Monetary Fund (IMF) and the World Bank are two international institutions whose responsibilities include assisting countries that get into economic trouble. They made the necessary loans and credits to Zambia contingent on extensive changes in economic policy, which caused many conflicts between Zambia and the international lenders. Since 1991, the UN has included Zambia in the group of least developed countries (LDCs).

On top of the country's economic problems came the HIV epidemic, which hit Zambia very hard. The number of deaths linked to HIV peaked in 2002, and in the following years mortality declined. In 2016, 1.2 million people in Zambia were living with a HIV infection.

Taxation

Norway has been assisting Zambia since 2007 with a programme to bring about greater efficiency in the collection of tax from the copper mines. The background to this was a decision in 1995 to privatise the cooper mines, which were subsequently sold to foreign mining companies. The turn of the century saw the start of a record rise in prices for copper and other metals on the world market. Five years later, real copper prices (adjusted for inflation) had regained the high level of the 1960s, when Zambian became independent. The price rise was particularly attributable to strong demand from China. This resulted in robust growth in Zambia’s economy in the form of jobs and increased activity. However, tax revenue to the state treasury from the mining companies was low.

Through the aid programme Taxation for Development, Norway assisted in the review of tax agreements and of the accounts of the big mining companies. In addition, Zambia’s Directorate of Taxes was strengthened. The result was that the tax system was restructured, and that there was more transparency about what the mining companies were paying in tax. The country has also gained more tax revenue. According to an IMF estimate, tax revenue amounted to almost nothing in 2006, and to NOK 4.8 billion in 2012. Global copper prices have fallen again since 2011, which has also affected tax receipts.

Agriculture

In terms of number of jobs, agriculture is the most important economic sector in Zambia. From the late 1970s, Norway supported an extensive programme for the development of rural areas in Zambian’s Northern Province. The programme aimed at persuading farmers to abandon slash-and-burn farming in favour of modern, sedentary agriculture with the aid of fertiliser, and to switch from cultivating the cereal type sorghum to maize. This approach has since been criticised for not taking account of the fact that traditional agriculture had many valuable aspects, and it has been difficult to demonstrate positive results of the Norwegian aid.

Since 1996, Norwegian agricultural aid has had a different orientation, and has instead been focused on disseminating knowledge about methods of cultivation known under the collective term conservation agriculture. The emphasis in this approach is on working the soil as little as possible, to avoid soil desiccation and erosion. Instead of ploughing or tilling, crops are planted in small basins or furrows in the field. Some 215 000 farmers have received training in these and other techniques. Many have had improved yields and higher incomes.

NGOs

A number of Norwegian NGOs have provided assistance to Zambia in many areas. Norwegian Church Aid, Save the Children Norway and Caritas are among the main ones.

In 2010, Lions launched a major eye health programme with money from their Red Feather collection and involvement by Norwegian eye specialists. In the course of 2015, more than 1500 patients had operations for cataracts and other eye diseases, thanks to a new Eye Unit at a provincial hospital in the town of Mongu. Many people regained their sight after being blind. Major aid organisations have also had a number of projects in Zambia.

Bonde i Zambia driver klimasmart landbruk ved hjelp av traktor
Conservation farming in Zambia
Climate smart agriculture increases productivity, make farming more climate resilient, reduces greenhouse gas emissions and reduces poverty. Norway has supported Zambian Conservation Farming Unit (CFU) for years. CFU teaches farmers to be innovative, and farmers who have received proper training, continue to use the method.
Gruvearbeidere utfører vedlikeholdsarbeid i gruve i Zambia
Taxation of the mining industry in Zambia
Zambia is one of the world’s largest copper exporters. A few years ago, Zambia asked for Norwegian assistance to improve their tax administration and their ability to raise taxes from large tax payers, especially from the mining industry.
Published 28.08.2014
Last updated 20.02.2019