Zambia Major Trade Agreements

Discusses key economic indicators and trade statistics, countries that dominate the market, U.S. market share, political situation, if any, the main reasons why U.S. companies should consider exporting to that country, and other issues that affect trade, e-terrorism. B, currency devaluations, trade agreements. These consisted almost exclusively of copper, cobalt, precious stones (mainly emeralds) and cotton. The United States has signed a Trade and Investment Framework Agreement with the Common Market for Eastern and Southern Africa (COMESA), of which Zambia is a member. Zambia is a politically stable, multi-party democracy rich in natural resources with an estimated population of 17.2 million, 42% of whom live in urban areas. The country has experienced positive economic growth for 20 years and has a growing middle class, but the combined effects of the unsustainable debt burden, a series of droughts and spillovers on agriculture and energy production, currency depreciation and the global COVID-19 pandemic are expected to significantly slow growth and economic activity. GDP growth was 1.9 percent in 2019, and the IMF forecasts growth to decline by five percent in 2020. The IMF`s 2019 Article IV report projected that Zambia`s debt would reach 96% of GDP in 2020, even if these estimates predate the pandemic. Inflation has remained permanently outside the Bank of Zambia`s (BoZ) mid-range target of six to eight percent in 2019 and 2020, reaching 15.9 percent in mid-2020. The economy benefits from liberalized prices for most items and has no currency controls.

Zambia`s main export partners in 2018 were Switzerland (due to the location of commodity traders rather than actual exports), China, Singapore, the Democratic Republic of Congo (DRC) and South Africa. During the same period, South Africa was Zambia`s main import partner, followed by China, the United Arab Emirates, India, the Democratic Republic of the Congo and Japan. Administrative corruption can be the most serious non-tariff barrier, particularly in the context of public procurement. Other non-trade barriers include intellectual property infringements, preferential treatment of state-owned enterprises, and a regulatory environment that is too cumbersome and often arbitrary and non-transparent. Zambia is open to foreign trade, which accounts for 75.7% of the country`s GDP (World Bank, 2018). Zambia`s trade policy is aimed at diversifying its economy through privatization programmes and the expansion of its export base. The country is a member of COMESA and has signed Interim Economic Partnership Agreements (Interim EPAs) with the European Commission. The country became a member of the WTO in 1995. Tariffs are high, but the country has few non-tariff barriers. Certain products such as crude oil, medical supplies and fertilizers are exempt from import duties.

However, irregularities in the tax system and high transport costs are real barriers to trade. The country mainly exports copper and other minerals (about three-quarters of total exports), while petroleum products, copper, machinery and transport are the main imported products. Zambian products are based on Switzerland (42.1%), China (14.4%), the Democratic Republic of Congo (9.5%) and Singapore (7.7%), while the country mainly imports South Africa (28.8%), the Democratic Republic of Congo (14.7%), China (13.6%), the United Arab Emirates (6.3%), India (4.7%) and Kuwait (4.7%). .

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