A new study for the first time reveals Lusaka’s contribution to the Zambian economy – African Business

A new study reveals that Zambia’s Capital City Lusaka accounts for more than a quarter of the country’s annual gross domestic product (GDP).

The study, produced by the Zambia Statistics Agency (ZamStats) with the support of the United Nations Economic Commission for Africa (ECA), was endorsed by Zambia’s national and local government officials, data specialists, national account experts, academics, urbanization practitioners and representatives of international organizations at an in-person workshop in Lusaka on 7 October 2022.

Opened by Mr. Joseph Tembo, ZamStats’ Assistant Director for Economic and Financial Statistics, the workshop examined the study’s findings and discussed a range of approaches to strengthen the city’s statistical capacity and the measurement of economic performance.

Key findings

The study offers evidence on the economic performance of the city of Lusaka and points to specific measures that could support the local government in unlocking the city’s full socio-economic potential, including leveraging both formal and informal activities. 

According to the findings, Lusaka City on average represented at least 24.2 per cent of Zambia’s GDP from 2016 to 2020. The average annual growth rate for the city was 3.1% during that same period. The informal sector contributed the largest share to GDP, averaging 40 per cent of the city’s GDP since 2016.

Furthermore, the study shows that in terms of GDP per capita, Lusaka’s economic output per person was US$2,200, which was significantly higher than the national average of US$1,400.

In view of the findings, the study recommended that the government should prioritize policy interventions to attract investors in high-value sectors, improve the city’s competitiveness,  and boost economic productivity by facilitating the formalization of many informal activities.

In a written statement to be given at the workshop Ms. Eunice Kamwendo, Director of ECA’s Sub-regional Office for Southern Africa, stated: “African cities contribute a large share of GDP to the national economy and have the potential to anchor robust economic growth. To unlock their full economic potential, we need disaggregated data at the city level to inform urban planning and management”

The way forward

“Therefore, we hope this study will be of great value to the data landscape of Zambia to support evidence-based urban policy and planning and investment decisions,” she added. “However, this study should not be a one-off exercise. It should be carried out regularly to assess Lusaka’s economic performance and should also be expanded to other Cities in Zambia.”

Ms. Kamwendo continued: “In this regard, we need to strengthen the capacity of ZamStats which is critical to ensuring ownership of city GDP estimation across all levels and equipping national accounts teams with the skills required to regularly conduct measurement studies.”

Addressing workshop participants Mr. Trevor Kaunda, Permanent Secretary for Monitoring and Evaluation at Zambia’s Ministry of Finance and National Planning, thanked ECA for mobilizing resources to facilitate the undertaking of the pilot study on Lusaka’s city GDP and providing technical assistance throughout the process.

He said: “My office considers this workshop to review and validate the [Lusaka]The estimation of city GDP is a crucial study as it will allow for sustainable production and use of data and information for planning purposes, as well as ensure that the data is uptaken by data users. The city GDP estimation will indeed support stakeholders to assess more systematically the economic role, performance, growth, and transformation of Lusaka city.”

The study is part a larger ECA initiative, which aims to promote a standardised practice for measuring city-level statistics disaggregated across Africa. Lusaka is currently one of six pilot cities in Africa that benefit from the initiative for the estimation of their city’s GDP.

The regional report on African city GDP estimation will be based on lessons learned and insights from the six pilot cities. Local governments will be able use the regional experiences in the regional report to measure their cities’ contribution to national economies for evidence-based planning and decision-making.

The study on Lusaka City GDP will be a vital tool to guide the city’s planning efforts in the future as well as to facilitate the rollout of the methodology to other cities in Zambia.

Distributed by APO Group for United Nations Economic Commission for Africa.