Amidst African stagnation, Zambia's economy is making progress. The nation has experienced annual average growth of 4.5 percent over the last six years. On President Levy Mwanawasa’s invitation, foreign investments are pouring into the mining, tourism, and agricultural sectors. For example, to build relations with Africa and promote long-term growth, a Chinese hydro company is investing US$600 million to assist the development of Kariba, an important Zambian dam. Similarly, the Indian Vendanta Mineral Resources will invest US$1 billion in the Konkola Copper Mine, the largest mine in Zambia, over the next three to four years. The Zambian economy has indisputably improved—quite the contrast with the past two decades of decline that it experienced. Nevertheless, for success to become long term and for its comparatively rapid economic growth to become even more impressive, Zambia must nurture its domestic economy, reform the tax structure, and strengthen the government's accountability.

To achieve lasting economic gains, the Zambian government must shape a better environment for domestic businesses. Rapid currency appreciation makes the exports sector vulnerable; domestic products are more expensive for international buyers, which in turn makes Zambian businesses less competitive in the international market. To strengthen an economy that relies so heavily on foreign investment, the Zambian government should implement policies that will reduce the cost of production and increase productivity for domestic businesses. For example, improving infrastructure would reduce systematic costs. The difficulty imposed by poorly maintained roadways on the transportation of goods directly contributes to these costs, and the government should establish a project to enhance the condition of its roads. Also, maintaining a nonvolatile political environment for business would undoubtedly increase worker morale and productivity as well as increase consumer confidence in domestically produced goods. With these improvements, Zambian exporters will be more competitive in the global marketplace and will realize greater profits, which can be channeled into the domestic economy.

An imbalanced taxation system is also hindering economic growth. For example, the struggling agricultural industry suffers from heavy taxation, yet the mining industry, the most profitable sector, gives only 0.5 percent of revenue to the government. The Zambian government should reform taxation to reflect the actual distribution of revenue and to incorporate the informal sector, which is estimated to hold three million potential taxpayers who currently pay no taxes to the federal government. If sectors are taxed fairly and the tax base is expanded, ordinary citizens in need of relief will experience the benefits.

Along with these economic reforms, there must be political changes to increase transparency and eliminate corruption in order to maintain the confidence of economic actors. The Zambia Business Forum (ZBF), representing the private sector, alleges that the government was deceptive about the reasons for appreciation. Besides a lack of information flow to citizens, corruption is the biggest setback for the Zambian government. Much of Zambia’s corruption resides in public services, such as permit and license approval, which are essential to the regulation of industry. President Mwanawasa created the Anti-Corruption Commission (ACC) in 2002 as an effort to cleanse the government. Yet although the ACC has arrested many former senior officials, it has failed to convict most of them. The Zambian government must act with increased transparency and accountability of political processes and decisiveness, giving the ACC more power to identify and convict wrongdoers. The Congress should therefore ratify the proposed Constitutional amendment to increase the legal powers of the ACC. It should also ratify the National Corruption Prevention Policy and Strategy designed to reduce corrupt practices by making corruption a high-risk practice. Citizens’ trust in their government and its accountability must be kept in order for the economic growth of the nation to continue.

Zambia has made substantial economic progress, no matter how one looks at it. It certainly outshines its neighbors. Yet there is still much more room to grow, and its economy has the potential to improve at an even more impressive rate. Without strong domestic trade, fair taxes, and a transparent government, Zambia’s economy will lose momentum, despite the billions of dollars of international aid and business currently flooding in. Zambia must focus on these three aspects of development and institute reforms as swiftly and as decisively as possible if it wishes to avoid the stagnation that surrounds it.