Zambia is a land-linked country with great potential and aspirations to become Southern Africa’s breadbasket and a regional hub for trade. With fertile land and an exceptional climate for a variety of crops — from commercial commodities like wheat and maize, to vegetable crops like onion and horticultural products like cut flowers — unlocking investment in the aviation subsector can open up many new markets for Zambia’s agricultural products. More broadly, the country has significant unspoiled natural resources and wildlife. Expanding the aviation subsector is also important for growth in the tourism industry, which has wide downstream effects on a variety of industries and is highlighted in the country’s development plans as a key driver of job creation and economic growth.

The USAID Business Enabling Project in Zambia is a five-year project that aims to catalyze private sector investment in four sectors (agriculture, trade, energy and tourism). The project launched in 2022 and conducted an institutional architecture constraints analysis (IACA) that highlighted constraints to private sector investment in Zambia in the project’s four priority sectors. The IACA highlighted the need to enhance the competitiveness, economic sustainability and the contribution of Zambia’s aviation subsector to contribute to the nation’s economic expansion, particularly through synergies with sectors such as agriculture and tourism. The sector facilitates trade, job creation and foreign exchange inflows into the country. Zambia’s strategic geographical location positions it as a promising hub for both cargo and passenger aviation. During the project’s inception phase, stakeholders shared that high regulatory costs, limited competition in the subsector and a disjointed legislative framework led to underinvestment in this critical linkage for agricultural trade and tourism.

Responding to stakeholders to generate evidence

Stakeholders report that Zambia’s aviation subsector suffers from several major challenges that inhibit its ability to contribute to Zambia’s economic growth, including:

• Coordination in the sector for trade and tourism is multisectoral, but responsible institutions often operate in silos; no single point of contact exists for international airlines with interest in operating in Zambia.
• Insufficient infrastructure — a lack of municipal airfields inhibits access to domestic markets and places onus on private farms to register runways; infrastructure for jet fuel and airport facilities is lacking, inhibiting cargo and passenger travel.
• The Zambian Airways agreement with Ethiopian Airlines is not “fit-for-purpose”; it precludes competing with Ethiopian Airlines on long-haul routes and competes with the private sector to regional destinations.
• Taxes and fees are comparatively higher than in other places, reducing competitiveness.
• High levels of bureaucracy.
• Insufficient data for decision-makers in government and domestic or international airlines to support an improved enabling environment for the subsector.

Bringing it all together

Above and beyond all other recommendations, the most critical need for the growth of the subsector right now is the elimination of silos. In response, the project is coordinating closely with the Public Private Dialogue Forum (PPDF), a presidential initiative to bring together stakeholders in key economic sectors to grapple with — and resolve — major issues blocking the growth of business. The PPDF with project input constituted a subcommittee of over 20 relevant government and private sector representatives from the Ministry of Commerce, Trade and Industry; Ministry of Finance and National Planning; Ministry of Transport and Logistics; relevant aviation bodies in the Government of the Republic of Zambia; think tanks; Zambia Tourism Agency; industry associations, including the Aircraft Owners and Operators Association; the Zambia Export Growers Association; the private sector board of airlines; and more. The subcommittee will now use the compiled findings of the study to address its recommendations.

Top of the list is establishing “Access Zambia,” an interagency committee dedicated to increasing air traffic in the country. This will kick off a campaign in data on aviation services and demand. Through improved coordination, other recommendations — such as empowering the Zambia Airports Corporation Limited (ZACL) to push for improved infrastructure and introduce greater competition into air handling services (among other improvements) — will also be achieved. These changes are expected to lead to an increase in cargo and tourist arrivals by 40% combined, more effective use of public funds for aviation growth, connectivity to 15 domestic tourism locations (nearly double the current connectivity) and create as many as 500,000 jobs.