World Bank Report Highlights Pathways for Zambia’s Economic Recovery and Job Creation

The report, titled "Unlocking Productivity and Economic Transformation for Better Jobs," provides a comprehensive analysis of Zambia's economic challenges and potential pathways for development.


Devdiscourse News Desk | Updated: 07-06-2024 15:24 IST | Created: 07-06-2024 15:24 IST
World Bank Report Highlights Pathways for Zambia’s Economic Recovery and Job Creation
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As Zambia continues to recover from the impacts of the COVID-19 pandemic and a prior recession, a new Country Economic Monitor (CEM) report by the World Bank outlines strategies to enhance productivity, drive economic transformation, and foster sustained and inclusive growth. The report, titled "Unlocking Productivity and Economic Transformation for Better Jobs," provides a comprehensive analysis of Zambia's economic challenges and potential pathways for development.

Despite significant economic growth in the 2000s, structural issues within the Zambian economy have persisted, resulting in growth that has not been inclusive enough to substantially reduce poverty or generate sufficient quality jobs. The Zambia CEM dissects the limitations of the country’s growth model and reveals that the economy's resilience was already compromised before the COVID-19 pandemic, which subsequently triggered a recession and led to an external debt default in 2020.

“Low job creation trends and a limited poverty response to economic growth could affect Zambia’s sustained and inclusive growth prospects. However, the recent debt resolution and reforms are expected to boost private sector investment and support macroeconomic stability,” said Nathan Belete, World Bank Country Director for Malawi, Tanzania, Zambia, and Zimbabwe.

Key Pathways to Economic Transformation:

1. Enhancing Agricultural Productivity: The report identifies increasing agricultural productivity as a critical pathway for Zambia’s development. Despite the sector's potential, current productivity levels are below expectations and are declining. Albert Pijuan Sala, World Bank Senior Economist for Zambia and co-author of the report, emphasized the sector's significance: “Raising productivity has enormous potential to drive poverty reduction and inclusive growth. However, challenges such as expensive and distortive support programs, alongside increasing climate hazards, constrain productivity growth and limit opportunities to diversify beyond maize.”

2. Promoting Private Sector Investment and Productivity Growth: The second pathway involves implementing critical economy-wide reforms to unlock broad-based private sector investment and productivity growth, essential for job creation and economic transformation. Jorge Tudela Pye, World Bank Economist and co-author of the report, highlighted the urgency of these reforms: “As the country continues to urbanize, the lack of enough good, well-paying jobs is holding back Zambia’s growth potential and its ability to maximize gains from economic transformation. The country must prioritize strategies for new and existing firms in labor-intensive sectors to rise and become more productive, creating more and better jobs for the growing working-age population.”

Path to Inclusive Growth:

The report underscores that Zambia's pathway to inclusive growth relies on addressing structural issues, enhancing agricultural productivity, and fostering a conducive environment for private sector investment. These steps are vital to transforming the economy, creating better jobs, and ensuring sustained growth that benefits all Zambians.

The Zambia CEM provides a roadmap for policymakers and stakeholders to address these challenges and leverage opportunities to achieve a resilient and inclusive economic recovery.

 
 
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