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High commodity prices feed the economic boom
Zambia
Progress made with good governance

Zambia’s booming economy has weakened significantly due to fluctuating global raw material prices and the impacts of the COVID-19 crisis. A further issue is the extremely high national debt, which continues to rise. As a result, the country has been in negotiations with its creditors and the International Monetary Fund for quite some time. Zambia is rich in natural resources, water, fertile land and tourist attractions, yet nearly two thirds of the population live below the poverty line. Rapid population growth – the highest in southern Africa – will cause Zambia’s population to double within the next 20 years. Voter turnout for the democratic election in August 2021 was high, especially among first-time voters, and the peaceful transition of power to the former opposition is raising hopes for further developments in Zambia.
For some years now, Zambia’s government has been decentralising its administration to improve its public service offerings. The aim is to involve the local population in important decisions with a view to ensuring that roads, bridges, markets, bus stations, health facilities and schools are built based on people’s needs, and noticeably improve their lives.
To help municipalities realise relevant projects independently, KfW is supporting Zambian district administrations and their elected representatives as they acquire the expertise they will need. Among other measures, they are being trained in how to plan investment projects using participative processes, how to call to tender and how to review their progress. This process is not just concerned with providing municipal infrastructure and public services for people – the aim is also to generate additional income for the municipalities. The political framework conditions for this are already in place. The newly created autonomous self-governing units give the districts more administrative and financial scope to make decisions. And due to tax reforms, the municipalities now also receive a greater share of the wealth and property taxes.
KfW is also promoting the refurbishment and expansion of the oldest school of administration in Sub-Saharan Africa. The resulting campus is a modern and learning-friendly environment where administrative staff can receive extensive further training and education.
In general, Zambia does not suffer from a lack of water, the country has abundant surface and ground water. But there is major competition for water. There is a lack of good water management to fairly balance the different requirements of agriculture, business and a constantly growing population. Climate change is also placing additional pressure on the valuable resource of water.
Zambia’s drinking water and sanitation services are inadequate. In rural areas, 42 per cent of people have no access to clean drinking water. In cities, this figure is 13 per cent. Less than half of the population is able to use sanitation facilities. Polluted water frequently leads to gastrointestinal diseases and cholera. These illnesses contribute to malnutrition and hinder child development. They also diminish many families’ opportunities to establish income.
So KfW Development Bank is financing the expansion and rehabilitation of drinking and wastewater networks as well as the construction of new treatment plants in (sub)urban areas, where Zambia’s population is growing at the fastest rate. KfW Development Bank is also advising the responsible parties with regard to how they can ensure sustainable operation. KfW is supporting measures to improve water and sanitation services in rural areas as well. These include constructing wells, training technical maintenance staff and conducting awareness campaigns about issues related to hygiene. The population is also receiving support as they build simple sanitation facilities in their communities.
Project information - Water (PDF, 147 KB, non-accessible)
Poor nutrition and illnesses of mothers before and during pregnancy as well as diets not suitable for small children have a devastating effect on child development – they stop growing. In recent decades, Zambia has seen a steady decline in the phenomenon known as stunting in children under five years of age. But the rate is still 36 per cent (WHO, 2019).
The Zambian government has a food security programme that aims to improve child nutrition during the first thousand days of life. This phase is critical for preventing stunting and other chronic effects of undernutrition in children. At the same time, the first thousand days are important for the general development of children – especially for the development of the brain. To this end, mothers receive information in small local groups about healthy nutrition, hygiene, preventive health care and early childhood development as well as small-scale gardening. Women and children are supplied with important trace elements and vitamins too.
KfW is also promoting mechanisation in emerging agricultural operations using funds from the German Federal Ministry for Economic Cooperation and Development (BMZ). For this purpose, a company was founded which uses a leasing model in local currency to make it possible for small farming operations to fully purchase equipment within three to four years, for example a tractor or other processing machines. In general, these small operations do not otherwise have access to bank loans.
Project information - Food security (PDF, 177 KB, non-accessible)
Further information
- Learn more about the impact of our work in Zambia in our transparency portal
- Read more about our completed projects in the evaluation reports on Zambia
- The BMZ's priorities in Zambia can be found directly on the Ministry's website
- On the website of the Federal Foreign Office you will find detailed information about Zambia
Local office
KfW Office Lusaka
Director KfW Office: Stephan Neu
P/Bag RW37X Lusaka
6469 Kariba Road, Kalundu
Lusaka
Zambia
Phone: +260 211 29 22-71
Fax: +260 129 24 07