Diversify economy, Zambia urged
Lusaka – Zambia’s economy will only develop if the country diversifies from mining, a leading stakeholder in the extractive sector has noted.
Like many African countries, Zambia largely relies on mining for economic competitiveness, with very little value addition being conducted at home.
In Zambia’s case, the over-reliance on mining is compounded by the fact that most extraction is that of copper, whose price fluctuates so often it makes economic planning any policymaker’s nightmare.
The price of copper has fallen by US$300 to US$6 700 per tonne in recent months.
This has prompted Zambia Consolidated Copper Mines Investment Holdings (ZCCM-IH) board chair Willa Mung’omba to call for diversification in terms of economic output.
ZCCM-IH is the state’s vehicle for investment in the mining sector.
Mung’omba recently said there was need for greater linkages between mining, manufacturing, agriculture and tourism.
“We do not believe mining will transform the Zambian economy and fight poverty on its own,” he said at the 87th Agricultural and Mining Exhibition in Lusaka.
For him, agriculture holds the key to Zambia’s future economic growth.
“Zambia will industrialise only when she has harnessed this sector (agriculture) effectively. As ZCCM-IH, we have come to understand this reality and therefore believe that the Zambian economy and businesses are better placed to adapt to change because of our country’s rich natural resources endowment,” he added.
While Zambia has a huge mining sector, it also possesses much potential in agriculture and tourism.
Experts point out that properly harnessing agriculture, complemented by mining, will grow the country’s industrial and manufacturing base much quicker and more sustainably than relying on minerals and metals extraction alone.
The country experienced the pitfalls of over-reliance on one sector in the 1970s when the prices of copper plummeted.
Zambia is Africa’s largest and the world’s seventh biggest exporter of copper.
Expansion projects could see Zambia becoming the world’s fourth-largest exporter of the red metal in the next three years, but experts say much more local beneficiation of resources is needed for the country to realise the full potential of its mineral base.
ZCCM-IH has made the first tentative steps towards local beneficiation by putting up funding for establishment of manufacturing plants in Zambia.
“ZCCM-IH, has been mandated to exploit the significant opportunities that exist for the establishment of local industries to produce some of the inputs into the mining industry as well as add value to the output from the mining industry beneficiation,” Mung’omba said.
He added, “ZCCM-IH recognises the importance of skills development within industry in Zambia.
“The shortage of skills impedes innovation for our country and causes the private sector to struggle to attain high levels of productivity.
The goal is for our industries to strive to contribute to economic development.”