Zambia
Zda Spotlight
Issue 5
Inside this issue:
Russia Determined to 2
Boost Trade with Africa
2009 First Half Records 2
US$755M Investment
MSE Clinches Multi- 2
Dollar Project
SA Firms Seeking 3 innovative to keep its in-
Agents at ZACS
ZDA Attends Dar-es- 3 Group that its investment
salaam Fair
MSEs Get Market & 3 MSEs earn a living through making simple wares . In picture,
Finance Access Training
Implications of Current 4 courage to attract huge
Financial Crisis
Points of Interest
• “FDI is becoming very
competitive, hence the
need to be innovative to
keep its inflow at par.”
• “Wealthier nations have
the obligation to assist
Africa create joint institu-
tions and companies that
rest on mutual economic
benefits rather than giv-
ing the continent primitive
aid which disadvantage
Africa’s development ”
• There is a steady come
back of investor confi-
dence in the economy
after the credit crunch.
Quote
“The investor of today
does not benefit from
yesterday’s growth”
Warren Buffet
Chinese Firm to Invest US$3.63 Billion
MSEs making pop corn machines. ZDA facilitates the growth of
MSEs in the country to enhance wealth creation. ( Story below)
Government, Zambia Devel-
opment Agency and
Zhonghui Mining Group Lim-
ited of China have signed a
US$3.6 billion Investment
Promotion and Protection
Agreement (IPPA) to guaran-
tee the Group’s investments
in the mining and related
sectors.
Speaking during the signing
of the IPPA, Minister of Com-
merce, Trade and Industry,
30 MSEs Registered with ZDA
ZDA approved thirty Small
and Medium Enterprise ap-
plications for MSE certifi-
cates in June, with a total
investment of K2.1 billion.
The approved investment
applications were from enter-
prises located in Lusaka,
Central, Southern, Western,
and Luapula provinces. Oth-
1
Development
Mr. Felix Mutati said the in-
vestment Zhonghui Mining
Group was bringing to Zam-
bia was the biggest single
investment in the region. Mr.
Mutati said the investment
would translate into more
than 32,000 direct job op-
portunities and an additional
2000 jobs in related indus-
tries. The minister has since
commended ZDA for working
hard to conclude the IPPA
negotiations with Zhonghui
ers were from ventures situ-
ated in North-Western and
Copperbelt provinces.
The K2, 108,142,542 total
investment is expected to
create 170 job opportunities
in the economy.
These applications were
from the manufacturing,
agriculture, trading, service,
Agency
July 31 2009
Mining Group leading to its
signing within a few
months.
Speaking at the same oc-
casion, ZDA Chairperson,
Mr. Luke Mbewe, said for-
eign direct investment was
becoming very competitive,
hence the need to be more
flow at par. Mr. Mbewe
assured Zhonghui Mining
would be well protected
under the laws of Zambia.
And Chinese Ambassador
to Zambia, Li Qiangmin,
commended ZDA for its
investment in the country
. “ZDA, you are very coura-
geous. It is not easy to
bring such a huge invest-
ment into the economy
from a single entity at
once,” said Mr. Qiangmin.
Meanwhile, Zhonghui Min-
ing Group Chairperson,
Yaohui Wang, said the
signing of the IPPA gave
(Continued on page 2)
and construction sectors,
with the service sector re-
cording the largest invest-
ment of about K791.6 mil-
lion while the manufacturing
sector recorded about
K616.2 million.
Other sectors contributed
about K70 million to the
MSE investment certificate
application approvals.
 PAGE 2
Russia Determined to Boost
Trade with Africa- Envoy
Russian Ambassador to Zambia, Boris
Malakhov, has urged African countries
to create effective financial instruments
that promote self-development to with-
stand economic upheavals.
And Mr. Malakhov has charged that
wealthier countries had the obligation to
assist African countries develop joint
venture institutions and companies that
rest on mutual economic benefit rather
than giving primitive aid to the continent
that consequently disadvantaged eco-
nomic growth and development of Afri-
can economies.
Speaking at a Business Forum organ-
ised by the Zambia Development Agency
at the just ended Zambia International
Trade Fair in Ndola, Mr. Malakhov said
Russia’s approach to Africa is to assist
the continent to unlock its potential to
boost its trade and economic stamina in
the world.
“What we want is to assist African coun-
tries to the extent of unlocking their own
possibilities. Russia is looking for such
ways and means of mutually beneficial
cooperation and providing assistance,
which by all means cannot be called
dead aid,” Mr. Malakhov said.
He said although the global financial
and economic crisis had substantially
undermined world economic stability
and affected every country, further
strengthening of friendly relations with
the African states and promoting multi-
faceted cooperation remained the high-
est priority of Russia’s foreign policy.
Mr. Malakhov said Russia’s trade policy
paid less attention to African and Latin
American continents in the 1990s, a
situation the country has revisited.
“Russia’s change of approach towards
Africa can be shown by the recent visit
of the Russian Federation President, Mr.
Dmitry Medvedev, to Egypt, Namibia,
Nigeria and Angola. The visits were
meant to give boost to our trade and
economic turnovers with Africa, which
currently stands at US8.2 billion Dol-
lars,” he said.
And Mr. Malakhov has said there was
need for cooperating partners to sign
intergovernmental agreements to en-
courage and protect investments that
faced difficulties in kick-starting due to
legal complications. Mr. Malakhov has
since commended the Zambian Govern-
ment for facilitating the exchange of
economic information to appropriate
institutions that helped in organising
business forums and presentations to
enhance mutual understanding among
partners.
“Russia and Zambia have good experi-
ence of cooperation in many spheres.
This facilitated our investment in Zam-
bian soil. For example, through Zambia’s
cooperation in economic and investment
information exchange, several Russian
investors have shown interest to invest
in Zambia based on business proposals
prepared by the Russian-Zambia Busi-
ness Council in September 2008 ,” Mr.
Malakhov said.
The Ambassador said the Russian Em-
bassy was ready to broker the establish-
ment of business relations with Russian
partners. He said potential areas of co-
operation could be in energy projects,
mining industry, oil and gas, tourism and
agricultural cooperation.
2009 First Half Injects
US$755.3m
ZDA has recorded more than US$ 755.3
million planned investment in the first
and second quarter of 2009. And the
Agency has recorded a tremendous rise
of investment in the second quarter
compared to the first quarter of the year
by more than US$ 357.7 million.
ZDA Senior Investment Promotion Offi-
cer, Roy Kapembwa, attributed the in-
crease to the steady coming back of
investor confidence in the economy from
the credit crunch. “The confidence of
investors is steadily coming back after
serious investment decrease experi-
enced recently due to the uncertainties
that were caused by the credit crunch,”
Mr. Kapembwa said.
The real estate sector contributed the
largest amount of pledged investment of
more than US$208.2 million, due to the
high demand for modern office spaces
by the market . The recorded investment
pledges during the period under review
were US$198, 777, 750 and US$556,
510,450 in the first and second quarter
respectively.
ZDA at the ZACS
Zambian Development Agency (ZDA) will
be explaining how it facilitates growth for
Medium and Small Enterprises (MSEs)
at the 83rd Zambia Agriculture and Com-
mercial Show slated for 30th July-3rd
August 2009. ZDA will use the ZACS to
promote the vast investment opportuni-
ties of Zambia to investors and entrepre-
neurs locally and abroad. This years’
theme is: “Challenge of Change,” a
theme that tallies with ZDA’s mandate of
facilitating growth of the MSE sector.
2
I S SUE 5
Chinese Firms to Invest
US$3.6bn
From page 1
confidence for the Group to invest in the
Zambian economy. “The IPPA is a guar-
antee that we can entrust our money
into the Zambian economy and very
soon both parties will see good results.
We hope to flourish with our Zambian
brothers and sisters,” Mr. Wang said.
Mr. Mutati signed on behalf of the Gov-
ernment, Zhonghui Mining Group Lim-
ited Chairman Yaohui Wang for the
Group and ZDA Board Chairperson,
Luke Mbewe, for the Agency.
The Zhonghui Mining Group Limited
project involves the mineral explorations
works, mining, concentrator works,
smelting, marketing and selling the cop-
per on the domestic and international
markets. An initial US$3.633 billion has
been earmarked for the project during
the first 5 years.
The investment project will be imple-
mented by the Group through its sub-
sidiary companies namely, Zhonghui
Mining Industry Zambia Limited, which
was incorporated on 19 July 2007,
Golden Lion Mining Industry Zambia
Limited, incorporated on 6 May 2008,
and Wang Wang Holdings Zambia Ltd.
MSE Clinches Multi-Dollar Pro-
ject
A Small and Medium Enterprise has
partnered with Lumwana Mines and
Marli Investment (Z) Limited to under-
take Jatropha Curcas Linn seedling
farming and supply the Linn-seedlings
to Lumwana Mines. Zam-Vizwear (Z)
Limited is undertaking the project under
the out-grower scheme initiative with
Marli Investment Zambia. In this vain,
Zam-Vizwear acquired a 10 hectare land
for the project at an estimated total
investment of US$38,000.
The US$38,000 covered expenses for
land acquisition and preparation, crea-
tion of a water reservoir, designing and
laying out the irrigation system, pur-
chase of Jatropha seeds, water pumps
and horse power engines for irrigation.
To kick-start the project, Zam-Vizwear
purchased 10×25kg bags of Jatropha
Curcas Linn seeds from Marli Invest-
ments (Z) Limited with each bag con-
taining 40,000 seeds at a total cost of
US$5,454.
Upon satisfactory production of the
seedlings in accordance with the terms
of reference and specifications, Marli
 I S SUE 5
Investment (Z) Limited bought the entire
Jatropha seedlings off the nursery on
behalf of Lumwana Mines at
US$290,909.09.
Following the country’s projected land
use of 2,000,000 hectares for bio-fuels
the market value for the seedlings is
projected to rise by 20% as most farm-
ers were closely following up the bio-
fuels in the agro-sector
The Jatropha project is Zam-Vizwear’s
diversification strategy from its initial
business of supplying industrial safety
requirements, protective clothing and
reflective materials to the Zambian busi-
ness community and the surrounding
Sub-Saharan African countries.
The major clients of Zam-Vizwear have
been the mines, but due to poor per-
formance of the sector, the company
experienced poor cash flow hence opt-
ing to venture into agro-related business
to cushion the impact of the losses
caused by the mining sector’s poor per-
formance.
South African Firms Seek Dis-
tributors, Agents at ZACS
Six South African companies under the
South African International Business
Linkages (SAIBL) have confirmed partici-
pation at this year’s Zambia Agriculture
and Commercial Show. These compa-
nies include Fred Footwear, ShineOn
Polish cc, Zhauns Group, Powa Brands
cc, The Smart Food Company, and Mak-
haya Bushmen Ceramics.
The companies manufacture a number
of products among them small-medium
machinery for food processing and dia-
per manufacturing, ceramic products
like tiles and bathroom assortments,
nutritional food (instant porridges, vita-
min and fortified foods), school and
formal leather footwear among others.
The companies are looking for agents,
buyers and potential distributors of their
products as a way of broadening the
market for their products in the region.
Those who wish to wish to get more
information on any of these companies
can contact their Trade Representative,
Patrick Chilombo on 0955 600 010 or
saiblzambia@yahoo.com.
ZDA Attends Dar-es-Salaam Fair
The Zambian stand at this year’s Dar-es-
Salaam International Fair, which took
place from 28th June to 9th July 2009,
attracted many visitors with chain stores
placing huge order for Zambian prod-
ucts.
Zambia Development Agency (ZDA) coor-
dinated the participation of six Zambian
companies in the 12 metre stand, which
was visited by Tanzanian President,
Jakaya Kikwete.
Mr. Kikwete was impressed with the
products on display and walked away
with product samples comprising as-
sorted fruit juices from California Bever-
ages, pharmaceutical baby care prod-
ucts from Pharmanova Zambia Limited,
leather shoes from Malar Industries
Limited, baked Beans and Peanut Butter
from Fresh Pikt. Including some as-
sorted garments and textile products
from African Joy and product information
brochures.
Many visitors to the stand wanted to
obtain first hand information about the
products being exhibited, the manufac-
turers, the quality of samples and how
they could make orders.
MSEs Get Finance and Market
Access Training
Zambia Development Agency (ZDA) and
partners have rolled-out a training pro-
gramme for Micro, Small and Medium
Enterprises in all provinces on access to
finance and markets. The training pro-
gramme which is being undertaken by
ZDA’s Micro and Small Enterprise (MSE)
Division and seven relevant institutions
is funded by the Private Sector Develop-
ment Programme (PSDP) at a cost of
K561 million.
Institutions involved in the programme
include Citizen Economic Empowerment
Commission, to explain its role in sup-
porting MSEs; Patents and Company
Registration Office, to highlight the regis-
tration procedures and requirements;
Zambia Public Procurement Authority,
for tender tips and how MSEs can ten-
der. Other partners are the Zambia
Revenue Authority on tax matters, banks
for guidance on financial discipline, a
Transnational Corporation to explain on
business linkages with MSEs, and Zam-
bia Development Agency to give entre-
preneurial tips on bankable business
plans.
Zambia Development Agency Medium
and Small Enterprise Division Director,
Windu Matoka said the programme will
run for five weeks. Mr. Matoka said the
training programme which started in
Solwezi in North Western province and
Mazabuka in Southern province this
month, will be concluded in September
2009. He said after this training, the
team will go back to the provinces to
have one-on-one discussions with MSEs
on challenges they encountered in con-
ducting business in their localities.
3
PAGE 3
ZDA Records More Than
US$100M Investment Rise
Last month’s planned investment inflow
has increased by US$109.7 million com-
pared to May, an indication that the
country has remained an attractive in-
vestment destination despite the credit
crunch. More than US$281.4 million
planned investment was approved last
month, compared to US$171.7 million
that was approved in May 2009.
The approved investment licence appli-
cations were from thirty-two applicants,
with a total of 3, 614 new job opportuni-
ties expected to be created once imple-
mented. These planned investments
were in the manufacturing, real estate,
services, tourism, agriculture, transport
and construction sectors. Other sectors
were health, financial and education
sectors.
The real estate sector attracted the larg-
est planned investment of about
US$200.6 million, while the manufactur-
ing sector with US$22.8 million. Other
sectors shared the total of more than
US$58 million of the approved invest-
ment licences.
Uganda Hosts Smart Partnership
Dialogue
The 19th Global Smart Partnership Dia-
logue was held in Kampala, Uganda with
a strong call for public-private partner-
ship towards improving social-economic
transformation for impoverished na-
tions. Speaking at the opening cere-
mony, President Yoweri Museveni of
Uganda described the Smart Partnership
dialogue as a win-win situation that
could spearhead the transformation of
African societies.
Mr. Museveni pointed out that the devel-
opment human resource, a network of
good roads and railway lines, adequate
and cheap electricity as well as the pri-
vate sector and regional integration are
critical pillars needed to accelerate
socio-economic transformation of socie-
ties in Africa. Mr. Museveni argued that
the Smart Partnership Movement was a
unique meeting that brought together
people of different cultural, political and
economic backgrounds to discuss global
issues with the aim of finding solutions
to the common problems.
The three-day conference attracted over
1,000 delegates and at least half of the
10 heads of government invited. Presi-
dent Rupiah Banda was among those
who attended the conference.
 Zambia Development Agency SELECTED ECONOMIC INDICATORS
P.O Box 30819 JUNE 2008 JUNE 2009

Nasser Road 1. Inflation rate (%) 12.1 14.4

Lusaka, Zambia 2. Average Treasury bills rate (%) 12.1 13.9

3. GRZ Bond Yield Rate: (24-month) (%) 14.7 18.9

4. Average Lending Rate (%) 24.4 27.0

Tel: 260-211-220177
5. Exchange Rates: (ZMK/foreign currency)
Fax: 260-211-225270
US$ 3,186 5369
E-mail: zda@zda.org.zm
EURO 5,092 7,181
Website: www.zda.org.zm BPS 6352 8024

RSA 407 627

6. Agriculture Commodity Prices: (US$/MT)

Maize N/A 318

Wheat N/A 385

Soya beans N/A 380

7. Capital Market Activity Equity trading:

Number of Trades 821 564

Volume of Trade 134,932,568 165,065,335

Turnover (US$) 33,710,080 3,975,596

Foreign Portfolio Investment: (US$)

Inflows (Buying) (US$) 16,690,437 811,095

Facilitating Economic Growth

Outflows (Selling) (US$) (10,195,523) (1,723,220)

and Development Net Position (US$) 6,494,914 (912,125) Sources: Bank of Zambia, C.S.O., Luse, Zamace

Zambia Development Agency

ZDA At COMESA Customs Union
Launch
ZDA was part of the Zambian delegation
that attended the 13th COMESA Head of
States and Governments Summit whose
deliberations culminated in a number of
agreements including the launch of the
COMESA Customs Union. The COMESA
Customs Union was launched with a
Common External Tariff (CET) of four
tariff bands. These bands are 0% for raw
materials, 0% for capital items, 10% for
intermediate goods and 25% for finished
goods. The aim of the Customs Union
aims is to create more trade links within
the COMESA region which will stimulate
intra- COMESA trade diversification. The
Customs Union’s interim period will
cover three years for tariff alignment,
plus an extension of five years. Zambia
is expected to realise tremendous bene-
fits from the Customs Union, including
increased Foreign Direct Investment
flows, export diversification and a
stronger negotiation position in multilat-
eral negotiations.
Implications of Current Financial
Crisis
Africa is affected by the financial crisis
in many ways including reduced trade,
financial growth, reduced remittances
and stagnating official development
assistance. This observation was made
at the Expert Group Meeting on Indus-
trial Investment Policies held in Addis
Ababa, Ethiopia. The meeting sought to
address the challenges hampering Afri-
can industrialisation. It was further ob-
served that foreign direct investment is
falling rapidly than global investment.
From empirical evidence, FDI has not
been a key driver of investment in Africa.
As a proportion of GDP, FDI in Africa it
accounts for about 5%. The key to
growth under the current condition is
ability of the economy to adapt to new
changes. There was also need for Africa
to highlight the fact that profitability in
manufacturing is higher at 20% than in
developed economies and the major
driver of investment under the current
global financial crisis is local investment.
Tourism
under theand Investment
current Promo-
global financial
crisis is local investment.
tion
The Ministry of Tourism, Environment and
Natural Resources and other relevant insti-
tutions between 13th and 17th July 2009
undertook a trip to identify tourism sites on
the Northern Tourist Circuit and other
areas to boost the tourism and investment
promotion drive. The exercise was meant
to capture photographs and video footage
of the identified sites to promote and show
existing infrastructure including available
resources in the areas to entice investors
and tourists. The team comprised the Min-
istry of Tourism, Environment and Natural
Resources, Zambia Wild Life Authority,
Zambia National Tourism Board, Zambia
Development Agency, National Housing
Authority and Zambia National Broadcast-
ing Corporation and provincial and district
administration officials in the identified
areas. Areas earmarked for the exercise
include Livingstone ,four sites in the Musi-
O-Tunya National park and two sites uphill
of Mukuni Village; Kafue National Park,
two sites along Itzhi-Tezhi dam and two
inland sites in the park; and Kasaba Bay
with four sites along Lake Tanganyika.