Zambia's economy showed resilience in 2024, expanding by 4% despite challenges such as drought and power outages, largely due to growth in the mining sector and services. The agriculture sector faced difficulties, but its contribution to GDP was minimal, allowing overall growth to continue.
According to the latest , the outlook for Zambia remains optimistic, driven by robust momentum in the mining sector, a rebound in agriculture, and improvements in tourism. Real GDP is anticipated to increase by 5.8% in 2025, with an average growth rate of 6.5% projected for 2026-27. The expansion in 2025 is partly attributable to some base effects as the economy recovers from the severe drought, supported by adequate rainfall in the current rainy season.
The ZEU recommends:
- Unleashing agricultural productivity by fully transitioning to the e-voucher system, improving targeting, and shifting toward private-sector-led financing to limit public liabilities.
- Raising productivity through greater competition in the energy sector.
- Closing tax gaps by strengthening revenue administration.
- Maintaining monetary policy tightening to anchor inflation expectations and protect policy credibility, to achieve positive real rates.
The Special Topic Section of this edition explores how Zambia can leverage Energy Transition Minerals (ETMs) for economic transformation.
In its focused chapter on ETMs, the ZEU argues that to maximize this potential, Zambia should focus on:
- Scaling ETM Production: Implementing comprehensive reforms to boost ETM production, including identifying mineral resources, ensuring a reliable and cost-competitive clean power supply, transport, and logistics services, upskilling the workforce, and strengthening environmental and social risk management.
- Maximizing Fiscal Potential: Strengthening ETM revenue management and allocation to support fiscal sustainability and broader inter-generational development objectives.
- Adding Value to Mineral Resources: Developing the copper value chain and addressing barriers to greater value-adding activities, including the lack of access to raw materials and finance, enhancing the inefficient investment climate, augmenting the electricity supply, and reducing trade and transport time and costs.