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					Investing in Zambia
Zambia at a glance

 •Surface area: 752,614 square meters
 •Landlocked surrounded by 8 countries
 •Population: 12 million
  Population growth rate: 3.1%
  GDP per capita 1,270
Zambia at a glance cont’d

 Official Language: English

Main Exports: (a) Traditional exports: copper
and cobalt;

Non-Traditional exports: agricultural products
and horticultural products, gemstones, timber,
electricity and cement

Main Imports: crude oil, equipment, textiles,
etc
Investment Climate
    Investment Act No. 39 of 1993 bestows full protection
     on investment against nationalization
    The Customs & Excise Act regulates customs duty
     taxes
    The Value Added Tax (VAT) Act regulates the VAT
     taxes
    The Income Tax Act regulates corporate taxes and
     other direct taxes
    The Companies Act of 1994 regulates the company
     formation and operations in the country
    100% repatriation of After-tax profits
Investment climate cont’d


     Predictable laws and policies
     Committed Government to investment
     Peaceful and highly friendly people
     Well advancing Free market economy
     Equal treatment of national and foreign investors
Key economic indicators


   Inflation rate is averaging   11 %
   Interest rate (Dec 2006)      27.8%
   Exchange rate (K/US$)          K4,300
   NTEs        (2006)            $658.4m
   Real GDP Growth (2006)         5.8%
    Zambia’s Uniqueness

     Distinctive advantages for investors such as:

      Favorable investment climate
      Peaceful multi party democratic country
      No exchange controls
      No restriction on foreign ownership
      No restriction on repatriation of profits & dividends
Investment Policy

 Government actions in creating an enabling
 investment climate:

     Removal of subsidies and price controls
     Abolition of forex controls
     Repatriation of 100% forex earnings
     Zambia Development Agency Act (2006)
     Lusaka Stock Exchange (1994)
Priority Sectors
 Prime growth sectors for investment are:
  a)   Floriculture

  b)   Horticulture

  c)   Processed foods

  d)   Beverages and stimulants (Tea, coffee and their products)

  e)   Production & processing of cotton, cotton yarn, Fabrics and
       garments

  f)   Manufacturing of Engineering products such as Copper, iron ore
       and steel, cobalt and other engineering products

  g)   Beneficiation of phosphates and any other related materials into
       fertilizer

  h)   Beneficiation of rock materials into cement
Priority Sectors
  i).   Production and processing of raw timber into wood products

  j).   Production and processing of the following products in the leather
        sector: Cattle hides, crust leather and leather products

  k)    Building of Mini-hydro power stations

  l).   Education and skills training

  m) Information and communication technology

  n)    Health sector and its various support services

  o)    Manufacturing

  p)    Tourism

  q). Processing of Agriculture products, forest products, non-ferrous
      metals and gemstones.
AGRICULTURE
  SECTOR
    Government Focus
To promote a self-sustaining and export-led
                                              Tobacco
Agriculture sector through:

   Creation of farm blocks
   Encouragement of out-grower schemes        Cotton

   Investment in irrigated agriculture
     Agriculture Investment
         Opportunities
Government has identified farming blocks in each of the nine provinces
Opportunities exist especially in the production of cash crops such as:

       Cotton
       Tobacco
       Sugar – Luena Sugar project
       Paprika
       Fresh Flowers and Vegetables
       Jatropha Curcus
       Fisheries
       Livestock
TOURISM
SECTOR
    Government Focus

   To place tourism development in the hands
    of the private sector
   To improve infrastructure and security in the
    tourism areas
   Encourage community participation in the
    preservation of wildlife and natural
    resources
    Facts on Zambia’s Tourism
     Home of the Mighty Victoria Falls

     Nineteen (19) National Parks

     Thirty-four (34) game management areas

     Rich and diverse cultural heritage
Tourism Investment Opportunities
   Development of tourism infrastructure such as
    lodges and hotels to offer accommodation and
    conference facilities

   Tour operations and Adventure activities in
    National parks

   Establishing private game ranches

   Establishing sports tourism related ventures such
    as white water rafting, canoeing and skiing
    Tourism Fiscal Incentives

    10% initial and 5 % annual depreciation for Hotels
    50% depreciation allowance for tourism machinery
     for two years
    Reduced duty or duty free on certain tourism raw
     materials
    Low import duty of 15% on intermediate goods
    Duty free on commercial scheduled aircrafts
    Import VAT deferment on Tourism capital goods
MINING
SECTOR
  Government Focus

To implement a comprehensive program aimed
at promoting private-sector led mining
     development
Zambia’s mining
   potential      • Zambia’s Substantial mineral
                  wealth includes Metals,
                  Gemstones such as
                  Aquamarine, Amethyst,
                  Tourmaline and Emerald,
                  Industrial and Energy minerals


                  • Copper, Cobalt, Lead and Zinc
                  are the most developed with a
                  mining history spanning over 90
                  years
    Mining Investment
      Opportunities
   Cutting & polishing semi and precious stones
    (Gemstones)

   Prospecting for new ore deposits

   Establishment of new mines

   Reclaiming of copper from slug tailing dumps.
     Mining Fiscal Incentives
   Customs, excise duties and import VAT
    exemption in respect of all
    mining/exploration machinery and
    equipment including specialized motor
    vehicles for mining rights holders

   100% capital allowances for prospecting
    and exploration expenditure and mining
    infrastructure development

   10% initial and 5% annual depreciation
    allowance for mining buildings
    Mining Fiscal incentives
            cont’d
   Mineral Royalty Tax for large scale
    mineral licenses is 3%
   Carrying forward of mining losses
    extended from 10 years to 20 years
   Exemption of 5% excise duty on
    electricity used for mining operations
   Corporate tax reduced from 35% to
    25%
   Corporate tax on Non-traditional
    exports (other than copper/cobalt)
    only 15%
MANUFACTURING
   SECTOR
          Government Focus
To rejuvenate and transform the sector into a
competitive export engine. Areas of emphasis are:

     Operationalization of the proposed Multi-Facility
     Economic Zone (MFEZ)
     Promotion of Small and Medium Enterprises
     (SMEs)
     Investment and export promotion for export-
     oriented products
     Promotion of local products, e.g. BUY ZAMBIA
     CAMPAIGN
       Manufacturing Investment
            Opportunities
The following sub-sectors continue to offer tremendous
investment Opportunities:


      Agro-processing and Mineral Processing
      Establishment of Textiles and Garments factories
      Motor Vehicles, Motor Cycles and Bicycles assembly
      Leather processing
      Wood processing
      Fish processing
      Metal/ Engineering Works
      Abundant Phosphates – Fertilizers
      Lime Deposits – Cement and Agricultural lime
Investment opportunities in other
sectors
Energy

   Electricity generation & transmission
   Upgrade/rehabilitation of Large & small
    hydro projects
   Electrification of farm blocks
   Exploration and production of petroleum
    resources
   Coal exploration
   Promotion & development of renewable
    energy resources, e.g. Biofuel
Energy opportunities cont’d
   The country has installed capacity of 1,760 MW.
    Hydro is 1,672 MW and Thermal is 88 MW.

   Potential sites for large hydropower development
    include:

    1.   Kafue Gorge Lower 750 MW
    2.   Itezhi-tezhi 120 MW
    3.   Kariba North Bank Extension 360 MW
    4.   Kalungwishi 163 MW

   Small hydro potential sites scattered across the
    country, mainly in Northern, Luapula and North
    Western Provinces

   Biofuels area of investment includes: Growing of
    Energy Crops, Setting up of Refinery to process
    energy crops and storage facilities for biofuels.
    Energy Opportunities cont’d
     Potential Transmission Projects include:

      •   Grid extension to Rural areas under the Rural
          Electrification Programme
      •   Zambia Tanzania Interconnector at a cost of US$650
          Million
      •   Regional connection to the SADC

     The current regional power deficit, the Rural Electrification
      Programme and the increasing mining activities, provide a
      growing market for potential investments.

     Renewable energy opportunities include biomass
      gasification, biogas and wind energy for water pumping

     Manufacturing of Solar Components

     Coal – The country has about 60 Million Tonnes of proven
      coal reserves.
 Investment opportunities in other sectors

CONSTRUCTION
    Construction of residential and business houses

    Road construction, rehabilitation & maintenance

    Rehabilitation & extension of Rail network

    Irrigation & water utilities infrastructure

    Manufacture of building material

    Government planned infrastructure projects offer additional
     opportunities for private sector investment

    Zambia is actively involving private sector in infrastructure
     development through Private Public Partnerships
      10 BASIC REASONS TO INVEST IN ZAMBIA
1)      Stable political system
2)      Positive & investor friendly economic environment
3)      Investment guarantee and securities
4)      Attractive investment incentives
5)      Progressive banking, legal and insurance services of
        international standards and a Stock Exchange Market
6)      Abundant Natural Resources presenting excellent
        investment and trade opportunities
7)      Duty free access to regional, wider Africa, EU and USA
        Markets
8)      Thriving Private Sector
9)      Repatriation of 100% profits
10)     GOOD PLACE TO WORK AND LIVE
ZAMBIA, THE WORLD
 OF OPPORTUNITIES
    AWAITS YOU!

    THANK YOU!

				
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