Its strategic location and membership in organisations such as the Southern African Development Community position Zambia as an important player in trade and regional integration. While the economy continues to grow, Zambia’s government faces the challenge of achieving more inclusive growth and improving its fiscal stability for sustainable development.

In recent years, Zambia has focused on diversifying its economy, reducing its reliance on copper exports and promoting sectors such as tourism, manufacturing and renewable energy. Despite facing challenges such as fluctuating commodity prices, droughts and inflation, Zambia has made progress in infrastructure development and attracting more foreign direct investment.

Since Zambia’s independence in 1964, its economic journey has been marked by fluctuating fortunes, often tied to the global market performance of key commodities. Periods of growth typically aligned with high international prices for copper and other exports, while downturns were triggered by falling commodity prices and environmental challenges. Over the decades, Zambia has struggled with persistent economic instability, largely owing to over-reliance on copper mining, mismanagement of state-owned enterprises, limited economic diversification and inconsistent macroeconomic policies.

These issues were further intensified by rising external debt and repeated fiscal deficits. In the 1980s and 1990s, the implementation of structural adjustment programmes, aimed at stabilising the economy, often led to austerity measures that failed to stimulate sustainable growth or reduce the debt burden. As a result, the economy bore deep structural weaknesses, and living standards for many Zambians declined.

Despite these long-standing challenges, Zambia entered a period of economic recovery from 2000–2005, with GDP growth rising from 3.9% to 7.2%. This rebound was driven by rising copper prices, improved macroeconomic management and greater investment inflows, offering a glimpse of the country’s potential for economic revitalisation.

Zambia saw strong economic growth in the 2000s, driven by policy reforms and poverty reduction strategies that prioritised rural development, infrastructure and social services. Support from the IMF and successful debt relief under the Heavily Indebted Poor Countries initiative led to the cancellation of more than US$6.6 billion in debt. The country achieved middle-income status in 2010, but its economy later faltered because of falling commodity prices, poor fiscal management and rising debt. By 2020, Zambia entered recession and became the first African country to default on Eurobond debt during the Covid-19 era.

Recent reforms aim to restore stability. ‘In pursuit of long-term growth and development, the country has implemented successive national development plans focusing on diversification, industrialisation, job creation and poverty reduction,’ according to the African Centre for Economic Transformation.

Historically, mining has played a central role in Zambia’s economy, accounting for between 11% and 19% of GDP since 2012, with the largest contribution (19%) in 2021. Zambia’s mining sector is heavily centred on copper, which plays an outsized role in sector output and the national economy. Copper is the cornerstone of Zambia’s mineral exports, making it one of the top copper producers in the world. A handful of major mining firms account for the bulk of copper production, with many of their operations having been active for years – yet they continue to be vital to the industry’s performance.

In 2023, Zambia’s Ministry of Mines and Mineral Development processed 1 840 applications for mining and non-mining rights through its Mining Licensing Committee. To streamline the process and improve transparency, the ministry launched a new online application system at the close of the year, marking a significant step forward in modernising how licences are issued.

Since taking office in 2021, the United Party for National Development-led government has made expanding mining output a national priority. One of its boldest moves came in its first budget, where it set an ambitious goal – ramping up annual copper production from around 800 000 tons to 3 million tons by 2031.

Reaching this target won’t happen overnight. It hinges on several key efforts – boosting production from current mines, addressing long-standing issues that have held some operations back, encouraging the discovery of new mineral assets and bringing more small-scale and artisanal miners into the fold.

At the same time, the government is looking beyond copper. Exploration activity is being stepped up for a broader range of minerals, including precious stones and metals, along with critical resources such as lithium, cobalt and manganese – materials that are essential to the global energy transition. In the first quarter of 2024, mining contributed 15.6% to Zambia’s overall economic output, reaffirming its role as the country’s second-largest contributor to GDP – in 2023 and into early 2024. While the sector saw a 5.9% contraction in 2023, it rebounded strongly with 9.6% growth in the first quarter of this year.

Looking ahead, prospects for the sector are improving. Growth is expected to be driven by rising production levels and concerted efforts to address long-standing operational hurdles, particularly at key sites such as Konkola Copper Mines (KCM).

Production at KCM has dropped significantly since the mine was placed under liquidation in 2019 at the request of Zambia Consolidated Copper Mines Investment Holdings. However, in a major development in September 2023, control was returned to majority shareholder Vedanta Resources, under a commitment to inject US$1.2 billion into reviving operations. A substantial rise in output is anticipated as these investments begin to take effect.

So far, 2025 has seen a notable uptick in copper production, with Zambia’s mining minister, Paul Kabuswe, announcing a 30% increase in Q1/25, compared to the first quarter of last year. Kabuswe attributed the increased output – around 224 000 tons – to higher production by Konkola and Mopani.

While copper is the mainstay of Zambia’s mining sector, the country produces other minerals that contribute to its export earnings. In Q1/25, Zambia’s production of cobalt, emeralds, nickel and gold demonstrated a mix of steady performance and emerging growth, reflecting the country’s diverse mining sector.

Tourism is another key pillar of the country’s economic transformation agenda. Zambia is rich in natural beauty and cultural heritage, and it offers a range of top tourism attractions, including Victoria Falls (Mosi-oa-Tunya); South Luangwa National Park; Lower Zambezi National Park; Kafue National Park; and Lake Kariba. The country boasts approximately 20 national parks and 36 game management areas and is home to more than 5 540 plant species, 242 mammal species, 757 bird species and 490 fish species.

Last year the country’s tourism sector experienced notable growth, with international arrivals reaching 2 199 820 – a 35.3% increase compared to 2023. Additionally, visits to national parks, museums and heritage sites rose to 530 110, marking a 9% uptick.

The ministry exceeded its revenue targets by generating ZMW319.5 million in non-tax revenue, representing a 59% increase over the projected ZMW200.9 million.

‘The progress we made in 2024 reflects our commitment to promoting Zambia as a premier travel destination,’ Zambia’s tourism minister, Rodney Sikumba, said in February 2025. The sector’s growth has been attributed to strategic marketing initiatives, increased budget allocations and enhanced infrastructure, such as improved air connectivity and the development of national parks and heritage sites

Agriculture is another vital sector in the country’s economy – supporting employment, economic growth and livelihoods. It provides food, jobs and income for more than 70% of the population. According to consultancy Knight Frank, agriculture contributed about 35% to the country’s non-traditional exports and about 10% of the total export earnings in 2023.

That said, the agriculture sector’s direct contribution to GDP has declined over the past few decades, amid challenges such as climate variability (with episodes of severe drought leading to sharp contractions in agricultural growth) and limited mechanisation. The IMF reports that in 2023, agriculture, forestry and fishing contributed just 2.2% to the country’s GDP. In 1993, that figure stood at 30.5%.

To address these challenges, the Zambian government has initiated efforts to diversify exports and enhance productivity in a bid to bolster the agriculture sector’s resilience and contribution to the economy. It is also investing in domestic fertiliser production and promoting commercial farming through the establishment of ‘farm blocks’, as a strategy to boost large-scale grain production and draw in foreign investment. Yet the initiative has struggled to gain traction, according to the International Trade Administration (ITA). Investors have shown limited enthusiasm, largely owing to the semi-public structure of the farm block model and the perception that site selection has been swayed by political considerations.

‘Additionally, government interventions in the agriculture sector, including market-distorting subsidies, export bans and unpredictable changes to agricultural trade policy have undermined private investment in the sector, particularly regarding maize and soybean production,’ the ITA states.

While Zambia does permit the import of genetically modified (GM) food products, the domestic cultivation of GM crops is still not allowed.

Maize and soya bean are Zambia’s primary crops. Some 80% of its grain production comes from low-yield small-holder farmers. Yet due to its nutrient-rich soil and abundant groundwater, Zambia consistently produces surplus grain. It also produces relatively smaller volumes of sorghum, millet, cassava, sugar, groundnuts, rice, cotton and coffee.

The Singapore-based Olam Group – a major player in the global food and agriculture sector – has a significant presence in northern Zambia, where it operates across 7 200 ha of farmland, spread over five estates dedicated to cultivating Arabica coffee for export. It began operating in Zambia in 2012, when the Olam Coffee Estate Company in Zambia was established.

According to consultancy Knight Frank, the company exports around 4 000 tons of coffee each year. Its workforce includes about 3 400 employees under casual and contractual terms, and during the six-month harvest season, it hires an additional 12 000 temporary workers for coffee picking. Notably, Olam now supplies Arabica coffee beans from its Ngoli estate to Starbucks in Seattle, US, marking a key milestone in Zambia’s international trade operations.

Zambia’s economic outlook is a cautious blend of promise and pressure. The country stands at a crossroads – rich in resources, young in population and strategically placed for trade, yet burdened by debt, climate shocks and stubborn structural hurdles. Recent reforms and IMF-backed programmes offer a lifeline – but only if matched by consistent policy, bold diversification and real investment in people. Zambia can’t mine its way to prosperity forever; it’s time to grow smarter, not just dig deeper.

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