ZAMBIA COMPETITIVENESS REPORT
John C. Keyser
With inputs from
R.V. van Gent
Agridev Consult Ltd.
The World Bank
Environmental, Rural & Social Development Unit
COMPETITIVE COMMERCIAL AGRICULTURE IN AFRICA (CCAA)
Zambia Competitiveness Report
1. This paper presents the Country Competitiveness Analysis for Zambia undertaken as part of the Competitive Commercial Agriculture in Africa (CCAA) study. The primary objective of the CCAA study is to explore the feasibility of restoring competitiveness and growth in selected African countries by identifying key commodities, production systems, and marketing arrangements that are capable of underpinning rapid development of commercial agriculture. The analysis in all CCAA countries covers seven important commodities and three farm sectors ranging from individual family farms to large-scale commercial enterprises; the commodities are cassava, cattle, cotton, maize, rice, soybeans, and sugar.
2. In Africa, the CCAA competitiveness analysis is being undertaken in Mozambique, Nigeria, and Zambia. In these countries, as elsewhere, the restoration of agricultural competitiveness depends on a number of factors, including the technical performance of agricultural commodity chains (comprising production, assembly, processing, and exchange activities); supply and demand conditions in domestic, regional, and global markets; and the appropriateness of the institutional and policy environment. By identifying commodity chains and production systems that have potential to compete effectively in an increasingly globalized world economy, the CCAA study is intended to inform the design of integrated programs of policy reforms, institutional changes, and supporting investments needed to promote the emergence of successful commercial agriculture in the three African case study countries. 3. To establish international benchmarks of successful development, a parallel analysis of value chain performance is also being carried out in Brazil and Thailand. These assessments are meant to allow production costs and other aspects of value chain performance in Africa to be compared on a global scale to help determine where the best opportunities for rapid growth in each target country can most likely be found. Cross-country comparisons and final conclusions will be written-up later by CCAA team leaders as part of an overall synthesis. This report looks exclusively at the factors that shape current competitiveness and development options in Zambia. 4. The paper is organized in six sections including an introduction. Section II provides an overview of the Zambia country context and factors that shape the opportunities for competitive development. Section III introduces the quantitative methodology used for the CCAA study and Section IV summarizes results of the input analysis of materials used for agriculture production and marketing. Section V presents the main value chain analysis for each of the seven CCAA commodities and the discussion concludes in Section VI with a summary of important findings and areas for further analysis. Results of various sensitivity tests of alternative price and yield assumptions are presented in Appendix 3 and the full set of spreadsheet templates completed for the Zambia analysis is presented in a quantitative annex.
Approach and Limitations
5. The analysis is based on qualitative and quantitative data. From the qualitative perspective, the approach is to try and identify major policies, institutional, and organizational factors that affect costs and shape Zambia’s trading relations. This part of the country work began with an extensive literature review carried out as a distinct first phase of the Zambia analysis. 1 The review is presented separately and includes a wealth of information relevant to the planning of...