If there is one pronouncement that has been constant among the different government regimes of the Republic of Zambia is economic diversification. The Covid pandemic has shown that indeed being an import-dependent economy is not good at all. There has been over-reliance on hard commodities such as copper which is the reason why the economy suffers a lot when the prices on international markets go down.
mplementation of the diversification policies has been a bit of a challenge. There are several sectors with great capacity that have not been able to operate to their full potential. One such is the agriculture sector despite the growth opportunity it offers.
Data published by Plecher on Statista shows that, agriculture contributed approximately 2.7% to Zambia’s 2019 Gross Domestic Product (GDP). One would argue that lack of adequate rainfall was the major cause for this decline but then again poor rainfall patterns cannot be entirely be blamed as there has also been lack of adequate investment in the sector that has enabled majority of farmers in our country to be rainfall-dependant in their farming practices.
Furthermore, data from statista shows that the percentage contribution of the agriculture sector to GDP has actually been declining, for the past ten years, from 11.55% in 2009 to 2.7% in 2019. There has been great untapped potential in the Zambian agriculture sector given that the population has been growing at a faster rate.
According to the World Bank, Zambia’s population growth was expected to grow at 2.9% in 2019. The population growth is huge given that Real GDP growth rate was estimated to be at 2% in that same year, 2019, by the African Development Bank (AfDB). Ironically, population growth might be seen as a danger to resources by some lenses, but if it is viewed in the sense of demand then it becomes a good thing. Taking for instance a venture in fish farming. Piers in an article published by Lusaka Times does acknowledge that the per capita supply of local fish has gone down from 12kg to 7kg per annum. Therefore, this entails that there is an excess capacity of fish demand that is unmet by the local suppliers.
According to the department of fisheries, to supplement the deficit, Zambia as of 2017 was estimated to be importing about 40 000 tons of fish every year at a price estimate of U$2.00 per kg. For starters that is a lot of forex going out and eventually contributing to the depreciating of our currency. There is a need for both the government and the private sector to come on board to grow the local fish industry.
We need deliberate policies that will encourage people to venture into agriculture. This is something that the Ministry of Agriculture has been striving for. A huge part of the Zambian population seems to feel like the only time to venture in agriculture is after retirement from formal employment, they do not see it as a lucrative business venture; a mindset change would help greatly, as well.
Furthermore, there is need for the private sector to come on board as well. Recently, the Economic Association of Zambia (EAZ), under Dr. Haabazoka, at an event they hosted in Luapula province, showcased how organized groups of local youths can set up fish ponds.
Lending institutions should also ease the requirements needed to access agriculture loans so that there is an improvement in the access to finance. This is the same point that Siwale in his Masters’ thesis published on OpenUCT website, when he stated that “70% of Zambia’s citizens engaged in agriculture are poor’and that lessening constraint of access to finance is one way to reduce poverty levels”.
The agriculture sector in Zambia has great potential to grow if it is accorded the seriousness it deserves. The export potential the agriculture sector accords the economy would be of great benefit to the Kwacha, seeing how much it has suffered against major foreign currencies such as the US dollar.