As the effects of the global COVID 19 pandemic kicks in, with foreign and international travel and trade almost coming to a halt, economies around the world have now been forced to look to domestic and local investments to keep their economies afloat and the wheels of trade moving.
This pandemic has paralyzed international trade, sports businesses with all major sporting events being put off. When the Zambian Business Times – ZBT spoke to the Livingstone Tourism Association – LTA Chairman George Sikumba, he confirmed that the effects on tourism in so deep such that the industry is now digging deep to find ways to keep their operations running due to high incidents of cancellations.
The Zambian economy has heavily relied on foreign direct trade as the major source of investment into the economy, and hen fact that COVID 19 may take another three to six months at best to clear out, there is need to now focus on domestic trade and domestic investments.
And the Zambia Development Agency (ZDA) has to this effect announced that it has doubled its efforts in promoting domestic direct investment (DDI) and re-investment in the wake of COVID 19 which was declared a global emergency by the World Health Organization (WHO) on 31 January 2020.
ZDA told ZBT that most of Zambia’s FDI sources and export destinations for its copper and now other non traditional [non-copper] exports are affected by the Covid-19. Therefore, Zambia’s Trade and Investment figures have significantly declined in the last two weeks. These include Zambia’s top trading partners such as DR Congo, China, South Africa and the EU market.
A number of investor missions that were scheduled to come for fact-finding missions and explore the opportunities have been postponed or completely cancelled. Others were earmarked to come and actualize their investment pledges but because of the deadly Covid-19 all these activities have been put on hold.
In addition other trade and investment related meetings in Asia, Europe, Southern Africa and other regions have been postponed indefinitely. However, it is the hope of the Agency that COVID – 19 should be contained as quickly as possible so that trade and investment can get back to normal where investors and traders are able to move freely.
ZDA Public Relations Manager Faith Musonda told ZBT on March 22, 2020, that the Agency has continued to strategically focus on promoting DDI, re-investment and the growth of SMEs’ to minimize the economic impact of Covid19.
Musonda stated that considering the current global health pandemic, the Agency will intensify engagement with existing investors for business diversification and re-investment as they already have an appreciation of the Zambian business environment, policy framework and available incentives.
In 2019, of the total projected investments worth USD 12.6 billion, USD 3.3 billion was re-investment, representing 26 percent of the total investment recorded. This reaffirms the great potential within the country working with the already established investors to create wealth and employment.
Some notable re-investments last year included Trade Kings, Intercontinental and Protea hotels, National milling, Californian beverages and University of Lusaka among others. The Agency therefore encourages investors, exporters and MSMEs’ to continue engaging ZDA.
Analysts say a special and strategic focus on domestic investments and trade is what will keep economies afloat in the wake of COVID 19. The sanitizing of local trading facilities markets should not be taken lightly together with strict land and airport boarder controls to prevent the virus from ravaging the remaining engine for local trade.
Local entrepreneurs, local traders and local investors are the remaining engine for the economy that should now be safeguarded to ensure that life in Zambia does not get constrained that may result into economic ruin.
Zambia already has economic challenges from the persistent Kwacha depreciation, power rationing and youth under employment as the major ones. There is a saying that all great challenges have great opportunities hidden in them. This COVID 19 had a silver lining and all efforts should be made to find and leverage the opportunities hidden behind this pandemic.
