Zambian Watchdog

Implications of Zambia’s movement out of LDC category

May 23
17:31 2011

By Kanni Wignaraja, UN Resident Coordinator in Zambia

The recently ended 4th UN conference on Least Developed Countries (LDCs) held in Turkey assessed the results of the 10-year action plan for LDCs adopted in Brussels, Belgium, in 2001. The conference closed with a number of recommendations seeking to halve, from 48 to 24, the number of LDCs during the next 10 years.

The pace and pattern of the movement out of the ‘LDC category’ has significant implications for Zambia in both the immediate and long term. First, it points to a changing development finance landscape for the country, where the traditional sources and uses of Official Development Assistance (ODA) see a transition. ODA will flow more to areas in patterns that follow the middle income countries – for more targeted interventions that look to address issues of inequity and exclusion, to better access global and regional public goods, and for niche areas of market development and job creation.

Newer forms of ODA, including that which flows through public-private partnerships and market driven instruments such as forms of climate financing will also become more of the norm. Zambia will have to ensure it is highly competitive in this new world, and has the policy mix and institutional capabilities to support and sustain such engagements.

Second, it can change the very fundamentals the economic drivers of growth for the country. During the conference, the majority of the delegates of the LDCs, including Zambia, voiced the need for LDCs to have greater access to international markets for their products and appealed to the developed world to support them in building the capacity of their respective public and private sectors’ economic and social institutions. This demand was incorporated into the key recommendations of the conference. Developed countries have been advised to realize timely implementation of duty-free, quota-free market access on a lasting basis for all LDCs consistent with Hong Kong declaration by the World Trade Organization in 2005, make substantial efforts for early conclusion of the Doha trade talks and reaffirm special and preferential treatment for LDCs in WTO trade agreements.

Zambia has a young population, with 46% of the population being under the age of 15. The realization of vision 2030, for Zambia to become a prosperous middle income country, lies in investing in its people and institutions, to raise its bar on human development. The quality of education, sharpening entrepreneurship skills and opening up markets so competition can thrive with government oversight, is key to meeting the needed global standards to attract the right quality of development financing and investments that Zambia strives for, to ensure a level playing field that’s best for the country in an increasingly competitive world.

Reality in the picture: Zambian children in a rural ‘classroom’. No desks.

 

In the last 10 years the country has experienced sustained and significant economic growth, averaging over 5%, and while this has pushed progress on some fronts such as in infrastructure development and primary school enrolment, the broader based benefits of this growth must now be focused on improving the lives of the rural and urban poor. As global experience shows, this broad based ‘lift’ to rural economies will establish a higher level of human development and a rise in the overall institutional capabilities of a country, that then attracts and maintains a more predictable and broad-based investment pattern where much of the gains of the new development finance, including FDI, remain to benefit a broader segment of the country.

Third, all LDCs face tough and very real choices, of where to invest scarce resources and what policy reforms and institutional transformations are needed to ensure broad based and more equitable growth. National leadership that looks beyond short term gains for the few, and invests in lifting levels of prosperity for the whole population over the long term, makes the difference. For Zambia to make a big dent in reducing rural poverty and penetrate the regional and global market it must diversify and invest in agriculture and tourism, creating decent work for all, particularly empowering women and youth. “This is where the jobs have to be created; through new investments that diversify the

Zambia has such an advantage, given the rich natural resource base it enjoys. The wise and sustained management of these resources, beyond the purely extractive industries, will be at the heart of whether Zambia’s middle income growth trajectory positively impacts all. Eco-tourism, for example, can become a mainstream and highly competitive industry here in Zambia. She said “based on patterns of climate change variability across the world, we know that the protection and regeneration of land and forests to sustain livelihoods and combat the adverse effects of climate change will have an increasing say on Zambia’s development trajectory and attainment of Vision 2030”.

Fourth, the LDC conference, while asking for the easing of existing regional and global trade barriers, also recognized the need for developing countries to raise the bar on the quality of their export products and services to be able to do so. “For many LDCs, including for Zambia, this translates into modernizing production, going up the value chain, and putting in place a strong quality control system that ensures its products and services meets international standards”, underlined the UN Resident Coordinator. She further noted that a well- targeted marketing campaign that familiarizes the world to what it has to offer, and packages these products must also follow, if countries such as Zambia are to out-bid its competitors in the same fields.

LDCs were further recommended to promote women’s entrepreneurship and remove barriers to investment, securing contract enforcement and promoting respect for property rights and promote public-private partnerships.

The UN system in Zambia, “Delivering as One”, is supporting Zambia towards these sustainable human development goals that underpin the Sixth National Development Plan (SNDP) 2011-2015.  Policy and investment choices that are driven by an inclusive growth will take the country along a middle income path that means better lives for all, including those currently made vulnerable through poverty, HIV or climate change. She said that in support of the SNDP, the UN system in Zambia would promote the creation of decent jobs and skills development particularly for young people and women to be entrepreneurs that benefit from a global and regional market place, in areas of agriculture and tourism.

Zambia was represented at this global conference by a high level delegation led by President Banda. The UN General Assembly convened the First United Nations Conference on the LDCs in Paris in 1981 to respond to the special needs of these countries. Halving the number of LDCs that meet at the next LDC conference in ten years’ time is an achievable goal.

 

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