PMRC Governance Series Seventh National Development Plan (2017 – 2021)
Explaining Critical Features Of The 7NDP – Part 2 | Theme: Economic Diversification and Job Creation
DEVELOPMENT OUTCOME 1: A DIVERSIFIED AND EXPORT-ORIENTED AGRICULTURE SECTOR
According to statistics in the Seventh National Development Plan (7NDP), agriculture sector is the fourth largest contributor to GDP (8.7 percent) and the largest contributor to employment. The sector is critical for achieving diversification, economic growth and poverty reduction in Zambia. We observe that the 7NDP will focus on agricultural development, considering two major leverage effects:
Increasing farmers’ incomes directly supports rural demand, which results in the development of new activities and the diversification of the local economy, contributing to the overall process of structural transformation.
Increasing agricultural outputs leads to the development of both upstream and downstream activities, the consolidation of value chains and the expansion of agro-industries, which are significant sources of employment and present ideal opportunities for economic diversification.
Diversification within the agriculture sector will be central in improving productivity, providing inputs to agro-processing and the manufacturing sector, for increased contribution to foreign exchange earnings among others. Agro-diversification and development will thus be based on comparative and competitive advantages in line with the Government’s Green Revolution agenda. From the 7NDP it is clear that focus will be placed on improving production of high value exports, such as cashew nuts, coffee, maize, wheat, tea, cotton, sugar, fish, agro-forestry and livestock products as well as other commodities to support the local manufacturing sector. Further, in view of agriculture development, suffice to say that, irrigation development remains a key intervention for increasing crop diversification, production and productivity.
Fisheries Potential: Fisheries offer great potential for diversification, gainful employment and poverty reduction. The fisheries sub-sector in Zambia is however, underdeveloped contributing around 3.2 percent to national GDP and many natural water bodies have been overfished due to inadequate legislation, control and surveillance. Thus, the transformation of both livestock and fisheries into diversified, competitive and export-oriented sub-sectors envisaged over the 7NDP period will require increased investment in water management and aquaculture-related infrastructure, ICT, logistics, storage, cold chain and road infrastructure.
Strategy 1: Improve production and productivity
Production and productivity improvement to be undertaken along the entire product value chain from farm to agro-processing and manufacturing at the sector and enterprise levels. The increase in production will be achieved through intensified agricultural mechanization, increasing the area under cultivation and the number of farmers participating in production.
Strategy 2: Improve access to finance for production and exports
This strategy will focus on enhancing access to affordable finance for farmers, agri-business MSMEs and exporters of high value agricultural products. Other interventions will include access to finance for auxiliary services to production and exports.
Strategy 3: Enhance agriculture value chains
Development in the sector value chains will include investment in production, agro-processing and marketing, including export market and distribution mechanisms. Value chain development will promote the participation of small and medium enterprises, coupled with provision of business development services to enterprises along different value chains. A notable development is that; Agro-processing parks will be established to support the processing of primary agricultural products into value added products.
Strategy 4: Promote diversification within the agriculture sector
The 7NDP clearly indicates that focus will be placed on agricultural diversification in crops, fisheries, livestock and forestry products based on comparative and competitive advantage of each product and agro-ecological zones.
Strategy 5: Enhance investment in agricultural infrastructure
Investments in agricultural infrastructure will be prioritised to create a conducive environment for a vibrant agriculture sector. Key among such infrastructure will be warehousing, storage, breeding centres and irrigation, among others.
Strategy 6: Promote small-scale agriculture
Small-scale agriculture has the potential to create jobs and enhance the living conditions of rural communities with the proviso that some key actions are implemented to improve the income, rights and status of farmers . These actions include addressing risk reduction through improved farming systems, a better market environment, secure land rights and adequate provision of public goods and social protection among others.
DEVELOPMENT OUTCOME 2: A DIVERSIFIED AND EXPORT-ORIENTED MINING SECTOR
The main mining activity in Zambia is large-scale copper mining while the production; processing and export of other minerals has remained underdeveloped. Under the 7NDP, emphasis will be on broadening the range of minerals to cover non-traditional mining of gemstones, gold and industrial minerals as well as promotion of value addition to mining products.
PMRC observes that under the 7NDP a programme will be set up, financed through the Environmental Protection Fund and will be invested into productive jobs for environmental restoration, notably reforestation. This is a very positive move in view of the need for a green economy. Another development sighted is that: mining of iron ore will be scaled-up to support the growth of the newly declared Kafue Iron and Steel Multi-facility Economic Zone. PMRC further observes that there is an opportunity for small-scale miners to tap into the programmes that are being lined up under the 7NDP in the mining sector.
Strategy 1: Promote exploration of gemstones and industrial minerals
Focus will be on increasing exploration, mining, processing and promoting use of industrial minerals and gemstone products, to increase contribution to the growth of other sectors. Under Mining, we observe that the Government has resolved to strengthen policy implementation and regulatory enforcement that does not stifle exploration of new mineral deposits.
Strategy 2: Promote local and foreign participation in mining value chains and industrialization
Under this strategy, efforts will be made to facilitate mining-based value addition and industrialization by supporting the development of manufacturing industries to produce inputs for other sectors, to contribute to the growth of other sectors.
Strategy 3: Promote petroleum and gas exploration
The strategy facilitates the establishment and capacity development of relevant institutions to monitor and regulate petroleum exploration. In addition, a governance framework for the sector will be established to attract investment and ensure efficient, safe and environmentally friendly petroleum exploration.
Strategy 4: Promote small-scale mining
As part of the diversification agenda within the mining sector, the Government will focus on building the productive capacity of small-scale miners involved in the exploration of gemstones and industrial minerals.
DEVELOPMENT OUTCOME 10: ENHANCED RESEARCH AND DEVELOPMENT
As a public policy research think tank, PMRC welcomes this development outcome, as it underscores the critical role and importance that research and development (R&D) plays in the innovation and development process of our country. It is a fact that Research is a key element of many developmental agendas and, when well-planned and used, enables a government to formulate evidence-based policies that lead to massive economic gains over a period of time. The 7NDP is key to Zambia’s development agenda. R&D is expected to play a critical role in the diversification process and to explore opportunities that will enhance the productive capacities of the various sectors of the economy. During the Plan period, R&D will be given priority. PMRC submits that in order to achieve the objectives set out in the 7NDP, there is need for the Government together with stakeholders to invest in research and development. It is through research that evidence to inform cost-effective programming and policy changes can be generated to allow positive contributions to economic diversification and creation of decent jobs. PMRC positions itself as a medium through which various research will be conducted; that compliments the strategies and programmes set out in the 7NDP.
Strategy 1: Enhance research and development, and innovation capacity
The strategy will focus on developing a high quality research base with a critical mass of highly qualified human resource, modern adequately equipped infrastructure and a technology development structure that will popularise science and technology for promoting and creating a national culture of research and innovation. This will increase national research activities in all sectors of the economy to enhance value addition for increased productivity.
Strategy 2: Enhancing policy formulation and analysis
To drive the economic diversification agenda, the Government will focus on strengthening policy-making processes through investing in research and analysis. Therefore, capacities will be strengthened to produce evidence-based analytical studies that will adequately inform policy development and subsequent paradigm shift.
The 3rd edition of the 7NDP-OPED series will focus on development outcomes in Tourism, Energy, Transport and Infrastructure.