Zambia Economic Update sets out energy-transition-mineral strategy for diversification

The World Bank-backed Zambia Economic Update outlined a three-pillar strategy to harness energy transition minerals after 4% real GDP growth in 2024. The plan's emphasis on value addition and ESG-aligned resource governance offers a reference point for Indian firms in clean-energy mineral supply chains.

Zambia's economy expanded 4% in real terms in 2024 despite drought and intermittent electricity, driven by mining and services. The Zambia Economic Update projects real GDP growth of 5.8% in 2025, averaging 6.5% over 2026-27. Its flagship chapter on Energy Transition Minerals sets three pillars: scaling ETM production, maximising fiscal revenue, and building downstream value chains. Zambia holds a comparative advantage in copper and cobalt, minerals crucial for electric vehicle batteries and renewable energy storage.

The mining sector, fiscal authorities, processing facilities, and small and medium enterprises in supply networks are most directly affected. On production, the report urges geospatial mapping of ETM reserves, clean energy access for mining, modernised logistics, and workforce upskilling, plus robust environmental and social risk management across the mining lifecycle. Fiscally, it recommends stronger revenue collection tied to ETM extraction, transparent public expenditure, and channeling revenues into inter-generational development funds to avoid commodity-driven macro-volatility.

Zambia should prioritise building the copper value chain by improving access to finance for processing facilities, streamlining regulatory approvals, and integrating SMEs into supply networks. Barriers to monitor include poor investment climates, inadequate electricity supply, and high transport costs. The report stresses focusing not only on extraction but also on value addition and local beneficiation, and aligning ETM strategies with climate risk disclosure, green industrialisation, and sustainable resource governance to enhance investor confidence and development finance access.

Key figure — Projected real GDP growth: 5.8% in 2025