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A presentation concerning investing in Zambia

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  • Karibu, Habariyako? That is the Bembe language for welcome and how are you. This presentation is about the country of Zambia, which is located in Sub-Saharan Africa. My name is Allen Wachter and I will be presenting you the nation of Zambia, an emerging country in which to consider starting a business.
  • Zambia is located in the southern part of the country of Africa. Zambia’s official name is the Republic of Zambia and has a population of 11,862,740 and has an official land mass of 290,600 square miles or approximately the size of Texas. Its capital is Lusaka and its official language is English and the Currency is Kwacha. 5200 Kwacha is the equivalent of one US dollar. It’s population consists of seven major and more than seventy minor tribes, each nourishing its own traditions vernaculars. Unlike its neighbors Zambia has never experienced serious tensions between its groups, and there is a unique and vibrant fusion of cultures in Zambia.
  • If you click on the flag you can see the flag of Zambia flying proudly. The nation of Zambia is quickly becoming known as the crown jewel of sub Saharan Africa. Its flag is pretty symbolic of the nation of Zambia. The green stands for the country’s natural resources and vegetation. Among the natural resources are copper, cobalt, zinc, lead, coal, emeralds, gold, silver, uranium and most importantly water. Zambia has one of the largest supply of water in all of the sub Saharan African continent. In addition its natural beauty and majestic rivers and water falls are a source not only of hydroelectric power but also tourism.
  • Zambia is a country of many natural resources and has a unique culture and landscape. The first few pictures depict a compound which is our equivalent of a market area. This is a typical town in Zambia, not a city but a town where people will gather to buy things, eat and sell whatever they can. Typical products include iron pieces, charcoal, honey, food stuffs. It is a land of poverty in places, with many orphans and homes constructed of metal. There are many children with no parents do to the AIDS problem and maternal grandmothers often are the main family unit.There are also hugh ant hills where children play. The rivers and lakes provide sustenance for fishermen. And then there is the wildlife and natural beauty. Sit back as we tour the sub-Saharan and the Zambezi wildlife. And then there is the tourist areas where the locals display their beautiful creations and artwork which you can purchase. During the summer it is dry, during the winter it is a lush green oasis. The Zambezi falls are breathtaking. Even President Obama shows up in Zambia. You will be inspired by the natural beauty of Zambia for sure.
  • Some Quick Facts about Zambia. It has a population of about 13.6 million. Its GDP (PPP) is $12.9 Billion and has a 6.6% growth rate with a 5 year compound annual growth rate of 6.5 %. It’s Purchasing Power Parity is $1,611 per capital Currently Zambia has an unemployment rate of 14% and its inflation rate is 8.7%. The foreign direct inflow is $2.0 billion. Zambia’s economic freedom score is 58.7, making its economy the 93rd freest in the 2013 Index. Its score has increased by 0.4 point due to improvements in labor freedom, monetary freedom, and freedom from corruption that outweigh a considerable decline in the control of government spending. Zambia is ranked 12th out of 46 countries in the Sub-Saharan Africa region, and its overall score is just below the world average. In the graph we see Zambia as red line and the United States as green. The blue line represents Zimbabwe a close neighbor. The Zambian economy still ranks poorly in many areas of economic freedom. There is a serious need for greater structural reforms to increase the legal framework’s efficiency and transparency and improve law enforcement. Widespread corruption erodes entrepreneurial incentives, and political influence undermines the independence and integrity of legal and regulatory systems.High youth unemployment and slow progress in improving the investment environment overshadow the benefits of economic growth that has averaged over 6 percent annually over the past five years. Prospects for sustained long-term economic development depend on effective diversification of the production base beyond the mining sector.
  • Zambia has been in the news recently because it has won the African National Championship in soccer and is one of the few countries in the area which hasn’t had any wars or conflict in the past couple of decades. They are also in the news because China has taken a keen interest in Zambia and has bought up all of the cooper minds and continues to make in roads into Zambia.
  • Formerly Northern Rhodesia, Zambia gained is independence form the British in 1064. In 1991, the government of Kenneth Kaunda, in power since independence in 1964, enacted a new constitution instituting multi-party democracy. Michael Sata of the Patriotic Front won the presidency in 2011, the first time a candidate from a party other than the Movement for Multiparty Democracy had been successful. In April 2012, Zambia released a draft constitution that included press freedoms, decentralized government, a bill of rights, and a 50 percent-plus-1 vote required for a presidential win. Zambia was the world’s third-largest copper producer and a middle-income nation in the 1960s, but falling copper prices and mismanagement of state-owned mines led to steadily declining income from 1974 to 1990. Recent increases in copper prices have boosted trade revenues by 30 percent. High rates of HIV/AIDS, high unemployment, and market-distorting agricultural policies contribute to persistently high poverty rates.
  • Zambia is set to achieve a growth rate of close to 8% in 2012, the highest level of growth in the past 20 years. In this video you will see YvetteeBabbe, an African Research Strategist at Sandard Bank talking about investment opportunities and growth areas in Zambia..
  • The question is Should you Invest in Zambia. Let’s talk about what is good and what is poor in Zambia for investment. The government is poor and runs on borrowed money mostly. Its citizens are equally poor with millions not working. Again despite the poverty, one can look at this as an opportunity. What aspects of investments would benefit the poor? What products and services are most essential to the poor and those living in rural areas? These are good questions to ask as you address the poor’s plight. Solar energy for example is one area that could benefit the majority of Zambians all across the country at the same time make someone some big money.One of the challenges of investing in Zambia is that it is very poor. As you come to do business in Zambia, realize that it is a small market compared to other markets. Depending on how one looks at it but it can be a great opportunity because the market is still fresh and immature. Which means, it leaves open so many industries untapped that one can venture into. For instance, internet usage is still less than two percent in Zambia. There are other industries such as agriculture and tourism that still need some substantial investment.The lack of adequate infrastructure presents a real challenge for many potential investors. One, therefore, has to be prepared to face the worst. If, for example, your investment is going to be in transportation, then you have to buy vehicles that will stand the Zambian roads. You must realize that you will be spending more on vehicle maintenance simply because the roads are not as good. Again, the lack of infrastructure should not only be a challenge for an investor but also an opportunity. For example, office space is becoming an issue in especially the capital Lusaka. Those who are investing in real estate will be reaping it big soon. Lusaka cannot get enough offices, shopping malls, play parks, schools, etc.On a positive note, Registering a business in Zambia is quite easy. You pick up the forms from the Registrar of Societies, fill them in and have all the necessary people sign them. Attach copies of articles of association as well as identification for all the directors. The whole process of registering a business takes less than a week provided you have all the required material. You do not have to be Zambian to do this.Politicians especially those in the ruling government have a lot of influence on state controlled companies. To do business with a state controlled company or a government department, you have to know someone who is senior. It is important to point out that in Zambia, the government is the biggest spender and almost everything revolves around the government. Businesses that do business with the government are the winners on the Zambian market. It is in your favor to be friends with the politicians and more benefiting if you can get key accounts with the government.Zambia has generally poor work culture especially in government run institutions. Workers are not usually in a hurry to do their work and meet deadlines. They get to work late and leave early. The customer service is very poor. You can walk in a store and the attendants will not pay attention to you. Instead, they will continue reading the newspaper or their conversations.Therefore, as one pursues business in Zambia it is important to understand its people so that you can devise ways to overcome frustration. If you are going to employ people or have business partners, be sure they know what your work culture is and what your expectations will be in the relationship.In Zambia, you have to be prepared to wait for everything. If you are from a western country like the United States you will immediately notice the difference. In the west people are usually in a hurry to meet deadlines or get work out of their way. However, in Zambia people are not usually in a hurry to do work. Even when you have an appointment with someone, they will come 20 or 30 minutes late without being apologetic. Therefore, you need a lot of patience to do business here in Zambia.This is a picture of President Sata- Bribery is against the laws of Zambia. However, it is a common practice here in Zambia. It is difficult to get anything done without giving or promising an official something. This is especially applicable to big business contracts in government or private sector. Every time you have a business proposal to another institution, the official on the other side is asking, “What is there for me?” Depending how badly you want the business from that institution, sadly you will need to find ways to motivate that official.
  • Watch the video, and imagine meeting one of the most popular national British heroes of the 19th century where you might ask him “Dr. Livingston I presume. One of Zambia’s greatest resources is its natural beauty and has opportunities to expand its tourism industry.
  • Some do’s and don’t’s for doing business in ZambiaDon’tRaise your voice when you are angry. Zambians avoid speaking loudlyRefuse gifts as they are a sign of respect or gratitudePoint your index finger at other people or try to get their attention by whistling as these gestures are considered rude. DoUse your right hand when interacting with peopleAccept invitations to social events – it will help build trust and establish strong relationships with your Zambian colleaguesArrive on time- even though Zambians have a relaxed approach towards time they expect foreigners to be punctual.Address people by their surnames and with their full titleHandshakes are important between both sexes. Will also clasp their hands in front of chest as a greetingIn business office, dress is typically casual but pay attention to how dressed- women wear long skirts- don’t expose your knees or shouldersAn indirect communication is preferred. Problems are never addressed directly but are instead referred to in an implicit way. Use a third party if there is an issue
  • Recently Zambia and Canada signed an investment promotion agreement. If you are considering doing business in Zambia here is some advice on Business DecorumBusiness hours in Zambia are Monday to Friday from 8.00 to 17.00 with a one hour break between 13.00 and 14.00.Appointments should always be scheduled in advance but be prepared that they may not be kept without giving prior noticeBusiness structure in Zambia is hierarchical and has a strong influence on working relationships. Typically supervisors are never questioned. You can ask open ended questions to find out if something is wrongIn business organizations managers or senior members tend to have the final wordMen and women tend to keep separate in Zambian culture and have clearly defined responsibilities. Women are seen as care givers to the family and expected to do their fair share of filed work. In the urban workforce, leadership is dominated by men. Foreign women in high positions should therefore be prepared for a fair amount of attention from their Zambian counterparts.Clan relationships and responsibility tend to influence business culture so it is important to understand how this can impact your work.Zambians like to add a personal touch to their working environment. They exchange niceties and take the time to talk about their family. Respectful behavior and education are qualities which are highly regarded by your Zambian counterparts. Religion – Just over half of the population follows Christianity yet traditional animistic religion remains pervasive in Zambian culture. Myths and legends are passed on from one generation to the next and the elders continue to perform tribal rites and customs. Zambians are tolerant towards people of other faiths but may find it difficult to understand if someone is not religious at all.Time – Zambians approach time in a very relaxed manner. Schedules are not adhered to and it is common for meetings to be delayed by one or two hours. Although people tend to be more punctual in professional settings, working hours and deadlines are perceived as an orientation rather than fixed timeframes.
  • Take this quick quiz to see if you are ready to do business in Zambia.
  • Zambia, an emerging nation, the new crown jewel of sub Saharan Africa awaits you. Come and be part of a great investment opportunity in agribusiness. Right now we are feeding much of sub Saharan Africa. We have the most water of the region, which we can harness for hydroelectric power. We have a cheap labor force, we have many natural resources, we are 8th out of 46 countries in the sub Saharan area for places to do business. Yes we have a few problems, our people are poor, we have a lot of AIDS, and our infrastructure needs some work, but we have gold and we have a great potential. Besides if you don’t come and invest, China will. Come and see our natural beauty and our land of opportunity. Zambia. Maishamarefu! Afya! Vifijo!
  • Final zambia pp

    1. 1. An Emerging CountryZambiaDr. Allen Wachter DVM, Dmin, CVPM, CMMBA 516 2/22/13
    3. 3. Green stands for the countrys natural resources and vegetation Red symbolizes the struggle for freedom Black the people of Zambia Orange the countrys mineral wealth The eagle represents the peoples ability to rise above the nationsThe Zambian Flag problems
    4. 4. Zambia
    5. 5. Population: 13.6 millionGDP (PPP): $21.9 billion 6.6% growthUnemployment: 14.0%Inflation (CPI): 8.7%FDI Inflow: $2.0 billionPurchasing PowerParity: $1,611 percapitaElectricity Produced:10 Billion KVAdult HIV/Aids Rate:13%
    6. 6. Zambia’s Current Economic Situation
    7. 7. Zambian Culture- Key Concepts and ValuesZambia Winners of African National Cup in Soccer
    8. 8. Zambia Past and Present
    9. 9. The Economic Future of Zambia
    10. 10. Should you invest in Zambia
    11. 11. Tourism- one of the gems of ZambiaVictorian Falls
    12. 12. Don’ts and Do’s in Zambian Business Etiquette
    13. 13.  Zambia and Canada sign investment promotion agreement Business Decorum
    14. 14. • Time for a quick quiz: If Zambians are discontent with a person they tend to avoid contact? True or False?
    15. 15. So should you do business in Zambia