Zambia - Country Commercial Guide
Investment Climate Statement
Last published date:

The U.S. Department of State’s Investment Climate Statements (ICS) provide information on the business climates of more than 170 economies and are prepared by economic officers stationed in embassies and posts around the world.  They analyze a variety of economies that are or could be markets for U.S. businesses.  The Investment Climate Statements are also references for working with partner governments to create enabling business environments that are not only economically sound, but address issues of labor, human rights, responsible business conduct, and steps taken to combat corruption.  The reports cover topics including Openness to Investment, Legal and Regulatory Systems, Protection of Real and Intellectual Property Rights, Financial Sector, State-Owned Enterprises, Responsible Business Conduct, and Corruption.

Executive Summary

Zambia is a landlocked country in southern Africa that shares a border with eight countries: Angola, Democratic Republic of the Congo, Tanzania, Malawi, Mozambique, Zimbabwe, Botswana, and Namibia. 

Zambia’s per capita income in 2022 was $1,522, and more than 60 percent of the population lives below the international poverty line of $2.15 per day (the average poverty rate across sub-Saharan Africa is 41 percent).  With a population of 19.61 million people, three-quarters of which live in rural areas, (3.1 million people live in the capital Lusaka) Zambia presents a relatively small domestic market that is geographically dispersed across a country slightly larger than the state of Texas.  Zambia is one of the world’s youngest countries by median age, and, given its fertility rate (24th highest globally), its population is projected to double by 2050.

From 2000 – 2018 (pre-COVID), Zambia had a robust average annual GDP growth rate above six percent and has been slowly recovering from the pandemic’s economic impact.  In 2022, Zambia’s GDP was $29.8 billion, an increase of 4.7 percent – following 4.6 percent growth in 2021. 

After defaulting on a Eurobond payment in November 2020, in December 2021, Zambia and the International Monetary Fund (IMF) reached agreement on a $1.4 billion, three-year, extended credit facility program to help restore macroeconomic stability and promote inclusive economic recovery.  Simultaneously, Zambia began the process of restructuring its debt under the G20 Common Framework.  While the debt restructuring negotiations have made substantive progress, the parties have yet to reach an agreement.  Due to Zambia’s debt crisis and the IMF program’s borrowing constraints, the government’s ability to financially support new investments is highly constrained.

Zambia is the world’s ninth largest copper producer and provides four percent of the global copper supply.  Zambia’s exports are dominated by copper ($7.7 billion), which comprised 76 percent of total export earnings in 2022.  All other mining products and byproducts, including precious stones, totaled less than eight percent.  Zambia’s second largest single export category (salt, Sulphur, stone, plaster, lime, and cement) comprised only 2.7 percent of 2022 exports earnings.  The mining sector constituted 12.9 percent of GDP in 2022 but accounted for only 2.4 percent of total employment.  While 75 percent of Zambians work in agriculture, the sector comprised only 3.9 percent of GDP in 2022. 

Despite broad economic reforms and debt relief under the World Bank’s Highly Indebted Poor Countries (HIPC) initiative in the early 2000s, Zambia has generally struggled to meet its full economic potential.  President Hakainde Hichilema won the August 2021 election on a platform of democratic and economic reforms, however, progress enacting these reforms has been slow and limited.  Pervasive corruption, cumbersome administrative procedures, inconsistent and unpredictable legal and regulatory policies, insufficient transparency in government contracting, lack of reliable electricity, high cost of doing business due to poor infrastructure, high cost of capital, and a shortage of skilled labor continue to undermine Zambia’s attractiveness as an investment destination.  Despite these challenges, Zambia possesses globally significant resources and offers significant investment opportunities in the agriculture, energy, infrastructure, and ICT sectors.

The U.S. Embassy in Lusaka works closely with the American Chamber of Commerce in Zambia (AmCham) to support its American and Zambian members to increase bilateral trade and investment.  U.S. firms are present and are exploring new projects in tourism, power generation, agriculture, and services.

To access the full ICS for Zambia, please visit the U.S. Department of State’s Investment Climate Statements website.