Zambia 

Zambia country policy

Policy established 07 December 2011

• ILC, bank guarantee or central public guarantee (unconditional)
• The country ceiling is 1000 mln euro
• Early warning signal 100 mln euro
• Public buyers: ORIO facility

Country class: 6

 Voor debiteuren in de mijnbouwsector is er een voorwaardelijke zekerheidseis.

Zambia country facts

Atradius Dutch State Business Economic Research
Country Report last updated :  2 August 2011
Country: ZAMBIA 

Political Situation
Build_Up To Elections

Head of state
President Rupiah Banda (since 2008, next elections: October 2011), president is chief of state and head of government

Form of government
The president appoints the cabinet from among the members of the National Assembly. Unicameral parliament.
Government of Movement for Multiparty Democracy (MMD), which holds 72 of 158 seats in the parliament

Internal Economic Situation :  High Growth

General situation
Zambia’s economy is largely dependant on subsistence agriculture. Maize is the most important crop. The external economy is dominated by the copper mining sector. Due to the rising copper price and bumper maize harvest, Zambia’s economy is booming and economic growth is forecasted at a record-high 6.75% in 2011.  The economy is (and will remain) vulnerable for fluctuations in the copper price and unfavourable weather conditions. 
Policy and institutions are qualified as medium quality by the WB. Inflation is above the inflation target of 5% but decreasing due to the good harvest. The exchange rate of the kwancha is highly volatile and correlates highly with the copper price. High HIV prevalence (17%), poor infrastructure and landlocked geography are structural  restraints to the economy. 
 
External Economic Situation
Fairly Low Foreign Debt

Main sources of foreign exchange
Copper (69%), cobalt (10%) 

Main foreign markets
EU (24%, UK 14%), China (21%), Saudi Arabia (9%), Congo (9%), Egypt (8%).

Main expenses of foreign exchange
Capital goods (44%), manufactures (25%), fuels (12%), food (8%).

Balance of payments 
Trade and capital balances are dominated by export and investment in the mining sector.