Inclusive Growth in Zambia

Topics: Poverty, Economics, Economic growth Pages: 8 (2972 words) Published: December 19, 2012
The main purpose of this essay is to discuss the limitations of inclusive growth in Zambia, and it will begin by defining the concepts of inclusive growth and economic growth. The essay will also take into account measures of inclusive growth and go on to evaluate the current state in Zambia by identifying the factors that promote the productivity of growth and the limits of inclusive growth and a conclusion will finally be drawn. The concept of inclusive growth has been defined by differently by different scholars. According to Ah and Nwason (2007:12) cited by Chigunta, inclusive growth is defined as, “Economic growth that not only creates new economic opportunities, but also one that ensures equal access to the opportunities created for all segments of society particularly for the poor.” Economic growth is the quantitative increase in the monetary value of goods and services produced in an economy within a specified period of time usually a year. Economic growth is also what is known as the national cake. Runiyar and Kawbur (2010) cited by Chigunta, defined inclusive growth as growth that includes and extends to pro poor growth. Pro-poor growth is improvement in social opportunities which imply the extent to which opportunities such as access to health or education benefit the poor. Ah and Zhwang (2007) cited by Chigunta, stated that growth is inclusive when it allows all members of the society to participate in and contribute to and benefit from, the growth process on an equal basis regardless of their individual circumstances. According to the Commission on Growth and Development (2008) as cited by the Economics Association of Zambia, inclusive refers both to the pace and pattern of growth. Pace and pattern of growth are considered to be interlinked and need to be addressed together and inclusive growth is not only concerned with the rate at which an economy is growing but how the economy is growing. It is argued that, Inclusive growth is a combination of two options that is the process of growth refers to participation in the baking in the National Cake which is economic growth or the input of large amounts of people in inclusive growth, while outcome of growth refers to equitable sharing of growth benefits. Inclusive growth adopts a long term perspective and is concerned with sustained growth. For growth to be sustained in the long run, it should be broad based across sectors. For example issues of structural transformation for economic diversification should take a front stage. Growth should also be inclusive of the large part of the country’s labour force this can be in the case of equality of opportunities in terms of access to market resources and unbiased regulatory, according to the Economic association of Zambia (2008). The key ingredients or measures of inclusive growth include growth, productive employment, and economic infrastructure, Income poverty and equity including gender equity, Human capabilities and social protection according to Chigunta. Zambia according to the Human development index (1999) ranked 156 out of 174 countries and according to the Human development index (2007-2008) Zambia ranked 165 out of 177 countries. Zambia’s Human development is low because there has been a slight decline in the ranking in the Human development index from 156 to 165 respectively and this shows that despite Zambia’s mineral wealth and fertile soil it is one of the poorest countries in the world. Zambia has enjoyed high Gross Domestic Product (GDP) growth rates averaging between 5 to 6 percent since 2000 and the GDP growth has rose to 7.6 percent in 2010 before falling to 6.6 percent in 2011. Zambia’s per capita income has risen from about US$370 in 2000 to over US$1,176 according to Chigunta. After decades of declining standards of living Zambia’s economy started growing and it’s per capital income has risen since the late 1990’s. Zambia has secured a stable growth record in recent years and increase untapped...
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