Effective management of public resources is essential in the development of any nation. Public resources should therefore, be applied for the best possible public benefit. It is for this reason that the Zambian Government allocates public resources to Parastatal bodies and Statutory institutions as they have an important role to play in service delivery, which ranges from water and sanitation, electricity, education and transportation among others.
The African Continental Free Trade Area (AfCFTA) is a flagship project of African Union Agenda 2063 and refers to a continental geographic zone in which goods and services are to move with, no restrictions; among member states of the African Union (AU). The AfCFTA aims to boost Intra-African trade by providing a comprehensive and mutually beneficial trade agreements among the member states, covering trade in goods and services, investment, intellectual property rights and competition policy. The agreement has been signed by member states of the African Union, bringing together 1.2 billion people with a combined Gross Domestic Product (GDP) of more than US$2 trillion. The draft agreement commits countries to removing tariffs on 90 % of goods, with 10% of “sensitive items” to be phased in later. The agreement is also set with the aim of liberalising services and to tackle non-tariff barriers, which hinder trade between African countries.
The (CFTA) intends to create a single continental market for goods and services, with free movement of business persons and investments, and thus pave the way for accelerating the establishment of the Continental Customs Union and the African Customs Union. Through better harmonization and coordination of trade liberalization and facilitation regimes and instruments across Regional Economic Communities (RECs) and across Africa in general; the CFTA aims to expand intra African trade. It further aims to resolve the challenges of multiple and overlapping memberships and expedite the regional and continental integration processes. Through exploiting opportunities for scales of production, continental market access and better reallocation of resources; the CFTA further aims to enhance competitiveness at the industry and enterprise level.
Zambia faces a challenge to meet rising demand for electricity as the economy, population and electrification continue to grow. Load-shedding in 2015-16 demonstrated just how high the stakes are for meeting this challenge as the economy suffered losses equivalent to 20% of GDP (Samboko et al 2016) and government bore the cost of expensive energy imports. As government undergoes fiscal consolidation in response to high debt levels, it should look to increased investment in Independent Power Producers (IPPs) to develop energy capacity. This approach offers the opportunity to meet increased demand in a way that protects fiscal spending and ultimately promotes long-term economic growth.
IPPs offer a sustainable route to increased energy capacity across Sub-Saharan Africa, where public and utility financing has traditionally been the largest source of investment in power generation. This picture is true of Zambia, where IPPs currently make up a small but growing part of Zambia’s energy portfolio through plants ranging in capacity from a few megawatts to around 300MW. Zambia has faced significant challenges in attracting IPP investment for several reasons, including below-cost tariffs, its regulatory framework and procurement processes, all of which need to be addressed if Zambia is to better exploit the opportunities that IPPs provide.