Zambia WT/TPR/S/106 
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II. TRADE AND INVESTMENT REGIMES 
(1) THE INSTITUTIONAL FRAMEWORK  
1. Zambia's institutional framework  has remained broadly unchanged since its TPR in 1996.  
Under the 1991 Constitution (as ame nded in May 1996), the Republic of Zambia is a multi-party 
democracy, after having been a multi-party democrac y from its independence in  1964 to 1972, and a 
one-party State from 1973 to 1990. 
2. The President is the constitutional Head of Stat e, the executive Head of Government, and the 
Commander-in-chief of the Defence Forces.  He is el ected by universal adult suffrage for a five-year 
term, renewable only once.  The President is not a member of the National Assembly but it is within 
his authority to dissolve it.  The Cabinet consis ts of the President, the Vice-President, and the 
Ministers.1  The President appoints the Vice-President and the other members of the Cabinet from 
among members of the National Assembly.  The Secret ary to the Cabinet, who also serves as Head of 
the Public Service, is appointed by the President , subject to ratification by the National Assembly. 
3. Legislative authority in Zambia is vested in Parliament, consisting of the National Assembly 
and the President.  The National Assembly comprises a Speaker, 150 elected members, and up to 
eight members nominated by the President.  The Spea ker is elected by the members of the Assembly 
from among non-members, and the Deputy Speaker from among the members.2  The latest legislative 
and presidential elections were held in December 2001. 
4. The Supreme Court is Zambia's final Court of Appeal.  The High Court has unlimited or 
original jurisdiction over all matters except for la bour and industrial matters,  over which the Industrial 
Relations Court has original and exclusive jurisdicti on.  The courts established by Acts of Parliament 
include subordinate courts, with so me criminal and civil jurisdiction,  and local courts with limited 
statutory powers.  Commercial matters are dealt with by a separate Commercial Court, created 
in 2001 at the same level as the High Court;  appeal s can be made to the Supreme Court.  A Revenue 
Appeals Tribunal hears and determines appeals agai nst classification of goods; its president is a 
lawyer appointed by the Judicial Service Commission.3  The Attorney-General, the Chief and the 
Deputy Chief Justice, and other judges are appointed by the President, subject to ratification by the 
National Assembly. 
(2) POLICY FORMULATION AND IMPLEMENTATION  
5. The Government formulates and implements policies and the National Assembly enacts 
related legislation.4  Each Ministry formulates policies relating to its field of activities, and submits 
them by means of memoranda to all Ministries; 21 days are allowed for comments, prior to Cabinet 
consideration.  The Ministry of Legal Affairs then drafts a bill on the basis of information provided by 
the Ministry that initiated the policies.5  The bill is submitted for approval to the Legislation 
                                                      
1 The President also appoints Deputy Ministers, including a Provincial Deputy Minister for the 
administration of each of Zambia's nine provinces. 
2 Issues before the Assembly are decided by majority vote of the members present and voting, provided 
that there is a quorum of one third of its me mbers; the Speaker votes in the case of a tie. 
3 The Judicial Service Commission, inter alia , advises the President on the appointment of judges of 
the High Court.  The Attorney-General may make rules for the Reve nue Appeals Tribunal. 
4 This is the case with all Acts. 
5 In the Ministry of Legal Affairs, there is a Chief Parliamentary Counsel, who is under the authority of 
the Attorney-General. WT/TPR/S/106 Trade Policy Review 
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Committee of Cabinet, and subsequently to Cabine t as a whole; thereafter it is published in the 
Government Gazette .6 
6. The published bill goes through three readings in the National Assembly.7  Upon Presidential 
assent, the bill becomes an Act of Parliament.8  The Act usually comes into force as soon as it is 
published in the Gazette , unless a specific date is mentioned.  Otherwise, a Statutory Instrument (SI) 
may specify the date on which the Act comes into effect, provided the relevant Minister has been 
empowered under the Act to issue the Instrument.  
7. Statutory Instrument (SI) are used to enact subs idiary provisions of Acts.  They derive their 
powers from Acts that lay down the substantive policy provisions.  Every SI must be published in the 
Gazette  not later than 28 days after it is issue; otherwise, it is void. 
8. International treaties, including those rela ted to trade, are signed by the President9, but they 
have to be ratified by Cabinet and incorporated in to Zambian law, with amendments to the law as 
needed.   
9. The Ministry of Commerce, Trade and Industry (MCTI) formulates and implements Zambia's 
trade policies.  Depending on the nature of the issues,  the MCTI consults with relevant Ministries and 
other institutions.  Pre-budget inter-ministerial c onsultations are held on tariff changes for fiscal 
purposes.  In accordance with Article 100 of the C onstitution, no taxation can be imposed or altered 
except by or under an Act of Parliament.  Tariff su spensions and exemptions are generally granted, 
under Parliamentary authority, by the Minister of  Finance (Chapter III(2)(iii));  incentives in the 
mining and quarrying sector are granted by the Minister of Mines. 
10. Ministries, including the MCTI, consult with  the private sector through various means, 
such as workshops on policy, and sensitization camp aign sessions to which various stakeholders  are 
invited (e.g. the Zambia Association of Chambers of Commerce and Industry, the Zambia Association 
of Manufacturers, the Zambia Congress of Trade Unions, the Textile Producers Association of 
Zambia, and the Zambia National Farmers Union).  There are neither reviews nor assessment of trade policies at the national level. 
(3) T
RADE LAWS AND REGULATIONS  
11. The Constitution, and through it Zambian laws, ha ve priority over international treaties, 
including the WTO Agreements.10  However, domestic legislation is  amended to the extent necessary 
to bring it into conformity with obligations undert aken by Zambia in the context of international 
treaties or agreements. 
12. Since its last TPR in 1996, Zambia has revised or amended some of its  trade-related laws.  
The Customs and Excise Act (Chapter 322 of the Laws  of Zambia), as revised in 1999, remains the 
main legislation governing Zambia's fo reign trade.  The Act deals with,  inter alia , the importation 
and exportation of goods, rules of origin, customs valuation, tariff concessions, the Revenue Appeals 
Tribunal, excise tax, and anti-dumping and coun tervailing duties.  The 1994 Companies Act, 
inter alia, regulates the conduct of companies and shareholders' rights. 
                                                      
6 The Committee consists of nine Ministers;  it is chaired by the Minister of Legal Affairs,. 
7 See WTO (1996) for details. 
8 In accordance with Article 78 of the Constitution,  all laws passed by Parliament are called Acts. 
9 The President may delegate the power to do so. 
10 In accordance with Article 1 of the 1996 Constitution, any law is voi d to the extent to which it is 
inconsistent with the Constitution. Zambia WT/TPR/S/106 
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13. The 1993 Investment Act, as amended up to 1998, sets out conditions for investment in 
Zambia (section (6)).  The Act does not apply to ba nking, insurance, and mining and quarrying, which 
are ruled by the Banking and Financial Services Act,  the Insurance Act, and the Mines and Minerals 
Act, respectively.  The Investment Act and the Mines and Minerals Act apply equally to local and 
foreign investments. 
14. Table II.1 lists the main trade-related laws in force in Zambia. 
Table II.1 
Trade related legislation in Zambia, 2002 
Area Legislation Most recent 
version 
Trade Control of Goods Act 1985 
 Trade licensing Act 1968 
Trade in scrap metals Scrap Metal Dealers Act 1961 
Trade in gold Gold Trade Act 1912 
Foreign trade;  customs procedures, valuation and duties;  rules of origin;  emergency measures;  excise 
tax;  tariff concessions ;  and Revenue Appeals 
Tribunal Customs and Excise Act, as amended 1999 
Value-added tax Value-Added Tax Act 1995 
Countervailing duty (investigati ons) Statutory Instrument 54 2000 
Tariff suspension on manufacturing inputs Statutory Instrument 23 1994 
Rebates, refunds, and remissions of bord er charges Statutory Instrument 16 1996 
Reduction of duties on goods from COMESA 
countries Statutory Instrument 13 1996 
Government procurement The Zambia National Tender Board Act 
The Tender Regulations 1982 
1995 
Technical standards and re gulations Standards Act 
Food and Drugs Act 
Plants, Pests and Diseases Act 1994 
1978 
1959 
 Weights and Measures Act 1994 
Enterprises Registration of Business Names Act 1995 
 Statutory Instrument 99 1998 
 Companies (Amendment) Act, 2000 (Act 1 of 2000) 2000 
 Statutory Instrument 15 2000 
 Statutory Instrument 16 2000 
 Statutory Instrument 17 1995 
 Statutory Instrument 100 1998 
 Companies Act 1994 
Public enterprises Privatization Act 1992 
Intellectual property rights Patents Act 
Statutory Instrument 54 Trade Marks Act 
Statutory Instrument 56 
Registered Designs Act Statutory Instrument 55 Merchandise Marks Act 
Copyright and Performance Rights Act 1995 
1995 1995 
1995 
1995 1995 1995 
1995 
Investment The Investment Act 
Most recent amendment 1993 
1998 
Investment in mining and quarryi ng The Mines and Minerals Act 1995 
Investment in banking and fina ncial services The Banking a nd Financial Services Act 1994 
Investment in small industries Sm all Enterprises Development Act 1996 
Insurance Insurance Act 1968 
Competition The Competition and Fair Trading Act 1994 
Export incentives Export Development (Amendment) Act 1993 1985 
Export promotion The Export Processing Zones Act 2001 
Tourism Tourism Act 1979 
Technical barriers to trade Standardisation of soap 1957 
Source:  Information provided by the Zambian authorities. WT/TPR/S/106 Trade Policy Review 
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(4) POLICY OBJECTIVES  
15. Since its TPR in 1996, Zambia has pursued its liberalization reforms launched in 1991, with a 
view to strengthening the viability of its external acc ounts, in concert with higher growth in a stable 
macroeconomic environment, and to reducing poverty.  Trade and investment policies continue to be 
among the key components of the reform programme .  Continued implementation of structural 
reforms, the privatization programme in particular, is to promote the private sector's participation in 
the economy.  The latter is to work "in partne rship with the Government to place Zambia in 
competitive as well as comparative advantage in  regional and international markets".11  This, coupled 
with Zambia's active participation in the multilate ral trading system and in various regional and 
bilateral trade agreements, is to secure market access for its products. 
16. Trade and investment policies still emphasize hor izontal diversification of non-traditional 
exports (any export other than me tals, including gemstones, and e xport crops such as horticultural and 
floricultural products, coffee, cotton, textiles, and tobacco), in order to reduce Zambia's dependence 
on metals, in particular copper, a nd counter falls in their production a nd fluctuations of their prices.  
In addition to measures in place at the time of th e 1996 TPR, to integrate agriculture and mining into 
the manufacturing sector for the further processing of export commodities, (e.g. the VAT with the 
zero-rating scheme, duty and tax concessions), Zambia  is gradually rationalizi ng its tariff schedule.  
The Export Development Programme and the Mining Sector Diversification Programme (MSDP) also 
aim to promote non-traditional exports (C hapter III(3)(iv) and Chapter IV(3)(i)). 
17. The legislative procedures of the Export Pr ocessing Zones Bill were accelerated due to 
awareness that diversification strategy failed to achieve, in the long-run, Zambia's goal of annual 
growth of non-traditional exports of 20% – the goal was met during the 1991-96 period, but not 
subsequently (Chapter I(3)(i)).  The full implem entation of the related Act (passed in 2001) is 
expected to contribute to boost non-traditional expo rts.  The Investment Act has been amended 
accordingly (section (6)).  Moreover,  the incentives available to opera tors in certain sectors (mainly 
agriculture and manufacturing) have been enhanc ed.  Non-traditional exports that have growth 
potential include primary agricultural commodities (co tton, coffee, soyabeans, sorghum, and tobacco);  
fresh flowers and vegetables;  cotton-based tex tiles and garments;  processed food (including sugar 
and stockfeeds);  gemstones;  value-added wood products;  leather products ;  and high value crops 
(marigold, paprika, herbs, spices, and essential oils). 
(5) AGREEMENTS  
18. Zambia is a member and active participant in all major multilateral organizations.  It values 
regional and bilateral cooperation, pa rticularly with its neighbours, but is aware of the limitations of 
such cooperation.12  The regional and bilateral trade agreemen ts to which Zambia is a party include 
provisions for consultation, concilia tion, and dispute settlement.  According to the authorities, Zambia 
generally favours arbitration, unless the relevant ag reement stipulates otherwise.  Zambia has not been 
directly involved, either as a complainant or as a defendant, in any trade dispute settlement 
proceedings. 
(i) Multilateral agreements 
19. Zambia accords at least MFN treat ment to all its trading partne rs.  In February 1982, Zambia 
succeeded to the status of contracting party unde r GATT Article XXVI:5(c);  it had applied the GATT 
on a de facto basis since its independence in 1964.  Zambia is an original member of the World Trade 
                                                      
11 Government of Zambia (2002), 2002 Budget Address. 
12 See WTO (1996) for details. Zambia WT/TPR/S/106 
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Organization;  it ratified the Marrakesh Agreements on 15 April 1994.  Zambia is not a signatory to 
the Plurilateral Agreements resulting from the Uru guay Round.  Zambia’s WTO notifications are 
summarized in Table II.2.  
Table II.2 
Status of Zambia's selected notification requirements to WTO, as of March 2002 
WTO Agreement Description of 
requirement Periodicity Most recent notification Comment 
Agreement on Agriculture (Article 18.2) Domestic support  Annual G/AG/N/ZMB/2 
6 July 1999   
Agreement on Agriculture 
(Article 10 and 18.2) Export subsidies Annual G/AG/N/ZMB/3 
5 July 1999 
 No export subsidies during 1997 
and 1998 
Agreement on Implementation of Article 
VI of the GATT 1994 
(Article 18.5)  Laws and 
Regulations Once, then 
changes G/ADP/N/1/ZMB/1 
27 April 1995 
  
Agreement on 
Implementation of Article VI of the GATT 1994 
(Article 16.4) 
 Anti-dumping 
actions taken Semi-annual G/ADP/N/47/Add.1 
20 April 1999 No anti-dumping actions during 
the preceding semi-annual period  
Agreement on 
Implementation of Article 
VI of the GATT 1994 (Article 16.5) 
 Competent 
authority Once, then 
changes G/ADP/N/14/Add.3 
20 January 1997 
   
Agreement on Rules of 
Origin (Article 5 and 
Annex II.4) 
 Preferential and 
non-preferential 
rules of origin Upon entry 
into force G/RO/N/15 
13 January 1997 Related to COMESA and the 
Fourth ACP-EEC Convention 
 
Agreement on Sanitary and Phytosanitary Measures 
(Article 7, Annex B)  Acceptance of 
Code Once, then 
changes G/SPS/N/ZMB/4 
15 September 2000  
Agreement on Safeguards 
(Article 11.2) 
 Safeguard actions 
taken Semi-annual G/SG/N/3/ZMB 
8 June 1999  
Agreement on Safeguards 
(Article 12.6) 
 Laws and 
Regulations Once, then 
changes G/SG/N/1/ZMB/1 
28 August 1995 No specific safeguard laws 
Agreement on Safeguards 
(Article 12.7) Safeguard actions 
taken Annual G/SG/N/3/ZMB 
8 June 1999 No measures as described in 
Articles 10 and 11.1 of the Agreement 
Agreement on Subsidies and 
Countervailing Measures 
(Article 25.1) GATT 1994 
(Article XVI:1) Specific subsidies Annual G/SCM/N/16/ZMB 
6 February 1997 No notifiable subsidies  
Agreement on Subsidies and 
Countervailing Measures (Article 25.11) Countervailing 
actions taken Semi-annual G/SCM/N/62/Add.1/Rev.1 
25 April 2001 No countervailing actions during 
the preceding semi-annual period 
 
Agreement on Subsidies and 
Countervailing Measures (Article 25.12) 
 Competent 
authority Once, then 
changes G/SCM/N/18/Add.3 
20 January 1997  
Agreement on Subsidies and 
Countervailing Measures 
(Article 32.6) Laws and 
Regulations Once, then 
changes G/SCM/N/1/ZMB/1 
28 April 1995  
Agreement on Technical 
barriers to trade (Article 15.2) 
 Laws and 
Regulations Once, upon 
entry into force Provisional entry  
Agreement on Technical 
barriers to trade (Annex 3C) Acceptance of 
Code Once, then 
changes G/TBT/CS/N/104 
16 October 1998  
    Table II.2 (cont'd) WT/TPR/S/106 Trade Policy Review 
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WTO Agreement Description of 
requirement Periodicity Most recent notification Comment 
Agreement on Textiles and 
Clothing (Article 2.6) 
 Administrative 
arrangements Ad hoc G/TMB/N/178 
24 June 1996 Data on 1990 imports 
Agreement on Textiles and 
Clothing (Article 6.1)  Transitional 
safeguard April 1995 G/TMB/N/ 103 
29 June 1995 Use of the provisions of the 
safeguard mechanism (Art. 6) 
The 1979 Decision on Differential and More Favourable Treatment (the 
Enabling Clause) 
 Customs union/ 
free-trade area Ad hoc WT/COMTD/N/3 
29 June 1995 Common Market for Eastern and 
Southern Africa (COMESA) 
GATT 1994 
(Article 17(4)(a)) State trading 
activities Annual G/STR/N/1/ZMB 
14 August 1997 No state trading enterprises in 
accordance with working 
definition contained in para. 1  
GATT 1994 (Article VII - 20.1) Delayed 
implementation of 
the Customs 
Valuation Agreement Once, then 
changes WT/Let/28 
21 August 1995  
GATT 1994 (Article VII - 
22.2) Laws and 
regulations Once, then 
changes G/VAL/N/1/ZMB/1 
5 October 2000 Laws and regulations to conform 
with the Customs Valuation Agreement 
 
Decision on notification 
procedures for quantitative 
restrictions 
 Non-tariff 
measures Every two 
years G/MA/NTM/QR/1/Add.4 
18 September 1997  
GATS (Article III:4) Enquiry points Once, then 
changes S/ENQ/59 
20 July 1999 
  
TRIMs (Article 5.1)  Inconsistent 
TRIMs taken Upon entry 
into force, 
then changes  G/TRIMS/N/1/ZMB/1 
25 April 1995 No TRIMs inconsistent with 
provisions of Article III or 
Article XI  
TRIPS (Article 1.3 and 3.1) National treatment Once, then 
changes IP/N/2/ZMB/1 
23 June 2000  National treatment is accorded  
TRIPS (Article 9.1) Relation to the 
Berne Convention Once, then 
changes IP/N/5/ZMB/2 
12 February 1999 Use of provisions contained 
within Article 14bis(2)(c) of the 
Berne Convention 
TRIPS (Article 4d) MFN treatment Once, then 
changes IP/N/4/ZMB/1 
7 November 1996 MFN treatment exemptions based 
on participation in international 
organizations and conventions  
TRIPS (Article 63.2) Laws and 
Regulations  Once, then 
changes IP/N/1/ZMB/1 
8 November 1996 Confers national treatment and 
MFN treatment 
TRIPS (Article 69) Enquiry points Once, then 
changes IP/N/3/Rev.4 
22 June 2000  
Source:  WTO documents. 
20. As a UN-designated least-developed country, Zambia  is eligible for special and differential 
treatment provided under the WTO Agreements.  A WT O study concluded that MFN tariff rates on 
products of export interest to least developed coun tries, including Zambia, were substantially higher 
in developing and transition econom ies than in developed countries.13  In Zambia's case, the study 
found that applied MFN tariffs on exports of agri cultural and manufactured products to developed 
countries averaged 11.7% and 3.4% respectively (0.3% and 1.1% if preferential tariff rates were taken 
into account) compared with 20.2% and 5.1% in developing markets.  
                                                      
13 WTO document WT/COMTD/LDC/W/17, 25 January 2000.  The study excluded preferential 
treatment extended under regional or bilateral arrangements, such as the Lomé Convention (now Cotonou Agreement). Zambia WT/TPR/S/106 
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21. Zambia supports the multilateral trading system, which it views as a means to expand the 
markets for its products and promote trade.  Howeve r, Zambia's capacity to take advantage of its 
participation in the system has been closely li nked to the implementation of the agreements, and 
technical assistance is therefore a key issue.  According to the authorities, even though this system 
offers opportunities for growth and development, least developed countries like Zambia are at a 
disadvantage by virtue of their level of development;   this is not helped by prevailing high tariffs and 
trade distorting subsidies in other countries. 
22. Zambia therefore supports the November 2001 Doha  Development Agenda to the extent that 
it has put development concerns at the core of WTO deliberations with an emphasis on technical 
assistance provision.  Zambia also supports the new round to the extent that high tariffs are to be 
reduced, trade distorting subsidies removed, and market access in the services sector enhanced 
especially through temporary movement of natural persons.  As an LDC, Zambia also supports the 
operationalization and strengthening of the flexibilit y accorded to LDCs in the form of special and 
differential treatment that is embe dded in the different agreements. 
23. Zambia is of the view that the WTO has a potentially important role in promoting 
development prospects by reducing trade barriers, helping governments to move towards effective 
trade policies, and dealing more effectively with implementation constraints confronted by countries 
like Zambia.  Zambia's constraints include:  lack of  adequate financial, in stitutional, and technical 
capacities to effectively coordinate and implement th e various agreements;  pa rticipating effectively 
in negotiations;  meeting notifica tion obligations;  amending domestic  legislation accordingly;  and 
carrying out awareness campaigns and studies to iden tify potential areas to liberalize, as well as 
liberalization assessments. 
24. In its continued efforts to place its economy on a higher growth path, Zambia will support all 
initiatives aimed at, inter alia , improving market access for its products, providing flexibility to 
Zambia through special and differential treatme nt, addressing the imbalances that hinder it in 
exercising its rights under the WTO, and providing tec hnical assistance to enable it to be an active and 
efficient Member of the WTO. 
25. Zambia seeks technical assistance from other WTO Members and international organizations 
to help it to meet its multilateral commitments (section (7)). 
26. Zambia is a member of the United Nations and its agencies, and other multilateral institutions, 
such as the International Moneta ry Fund, the World Bank, and the African Development Bank.  
(ii) Regional agreements 
27. Zambia is actively involved in two main re gional trading arrangements: the Common Market 
for Eastern and Southern Africa (COMESA), and the Southern African Development Community 
(SADC).  It is a member of the Cotonou Agreement,  which is expected to lead to Regional Economic 
Partnership Agreements with the EU.   A Growth Triangle aliance (a tr ans-national economic zone) is 
being concluded by Zambia, Mala wi and Mozambique.  The Government believes that preferential 
trade agreements provide a first step towards greater integration and wider liberalization. 
28. Zambia's membership of overlapping regional and bilateral arrangements makes its trade 
regime more complex, as they have different geographical coverage, trad e liberalization agenda, 
phase-in periods, trade policy instruments (such as non-tariff measures, including rules of origin, 
technical barriers to trade, sanitary and phytosan itary measures, internal taxation systems), and WT/TPR/S/106 Trade Policy Review 
Page 18 
 
 
goals.14  Its trading partners receive different access  conditions to its market depending upon which 
agreement they are in, and the stage of implementa tion of the agreement by the partners; members of 
more than one agreement can trade with Zambia  under either agreement.  The same applies to 
Zambia's exports to these markets.  This may dist ort trade and preferential/incentive patterns in an 
unpredictable manner and could en tail inconsistent obligations being undertaken by Zambia. 
(a) Common Market for Eastern and Southern Africa (COMESA) 
29. Zambia was a founding member of the Preferen tial Trade Area for Eastern and Southern 
African States (PTA), which became COMESA in late 1994.15  The COMESA agenda is to deepen 
and broaden the integration process among member st ates through:  the complete elimination of tariffs 
and non-tariff barriers to regional trade, and the a doption of a common external tariff (CET);  the free 
movement of capital, labour, goods, and the right of  establishment within COMESA;  the adoption of 
a common set of standards and technical regula tions, quality control procedures, certification 
schemes, and sanitary and phytosanitary regulations ;  the standardization of internal taxation 
(including value-added tax and excise duties), and conditions regarding industrial cooperation, 
particularly on company laws, intellectual property rights, and investment laws;  application of 
harmonized competition policies;  and the establishment of a Monetary Union.16  C O M E S A  w a s  
notified to the WTO under the Enabling Clause in 1995 (Table II.2). 
30. COMESA is thus to be a customs and monetary union.  Its Free Trade Area (FTA) was 
launched on 1 November 2000; Zambia and eight other members met this deadline.17  The status of 
the participation of several other members varies considerably.18  The customs union is to be 
implemented by 1 November 2004 with a common exte rnal tariff (CET) comprising four tariff bands:  
zero, 5%, 15%, and 30% (on capital goods, raw ma terials, intermediate  goods, and final goods, 
respectively).  However, since most COMESA members, including Zambia, have maximum tariff 
bands below 30%, discussions are under way on the possibility of reducing the agreed CET rate on 
final goods. 
31. Tariff preferences are subject to rules of origin requirements.  COMESA provides four 
alternative criteria for determining origin on whic h an exporter may claim eligibility for preferential 
treatment:  that goods are wholly produced in the region using no outside materials;  that imported 
                                                      
14 In total, there are nine common members of SADC and COMESA. These are Angola, the 
Democratic Republic of the Congo, Malawi, Mauritiu s, Namibia, Seychelles, Swaziland, Zambia, and 
Zimbabwe.  Other regional groupings that have cross-membership with SADC/COMESA are the Southern African Customs Union (SACU), Indian Ocean Commission (IOC), East African Cooperation Commission 
(EAC), and the Inter-governmental Authority on Development (IGAD). 
15 Other members are Angola, Buru ndi, Comoros, Djibouti, Egyp t, Eritrea, Ethiopia, Kenya, 
Madagascar, Malawi, Mauritius, Namibia, Rwanda, Seychelles, Sudan, Swaziland, Uganda, the Democratic 
Republic of the Congo, and Zimbabwe.  Tanzania, Lesotho, and Mozambique have withdrawn. 
16 See COMESA online information.  Available at:  http://www.comesa.org/obj.htm. 
17 The other members are Djibouti, Egypt, Keny a, Madagascar, Malawi, Mauritius, Sudan, and 
Zimbabwe.  Merchandise trade between the FTA COMESA  members is at zero tari ffs, without exception. 
18 The status of implementation of the tariff reduction programme varies substantially among the 
members yet to join the FTA.  Rwanda has published legislation effecting a tariff reduction of 80% from 
1 January 2002, 90% from 1 January 2003 and 100% from 1 January 2004.  Burundi has decided to effect a further tariff reduction of 80% from the current level of 60% as from January 2003, and will effect a 100% 
reduction in January 2004 (on COMESA originating products).  Consultations are continuing with Democratic 
Republic of the Congo, Seychelles, Comoros, and Uganda.  Eritrea and Ethiopia are still studying the 
implications of membership.  Namibia and Swaziland  (both are SACU members) are still under a derogation 
until 31 July 2003.  This is intended to allow time for consultations between the COMESA Secretariat and the 
two countries as well as to enable them to seek th e concurrence of the other SACU member states.  The 
COMESA Treaty therefore provides fo r a multi-speed integration programme.  Zambia WT/TPR/S/106 
 Page 19 
 
 
content of goods is not more than 60% of the c.i.f.  value of the total cost of materials used in 
production;  that goods contain not less than 35% ex-factory value added 19, reduced to 25% if the 
final product is considered to be of "particular importance" to the economic development of a member 
state20;  or that there is a change of tariff classification heading following transformation. 
32. Zambia's non-traditional exports (NTEs) to the COMESA FTA amounted to US$34.7 million 
or 34% of the total value of NTEs during the firs t half of 2001.  This compares with US$29.4 million 
during the same period of 2000, an increase of 18%.  Th e increase is partly attr ibuted to the increased 
market access following the launching of the CO MESA FTA.  Exports to Kenya especially have 
increased significantly. 
33. The Monetary Harmonisation Programme is to be implemented in four phases, from 1992 
to 2025.  The final phase should culminate in full m onetary union, with the use of irrevocable fixed 
exchange rates, a single currency or parallel cu rrencies; full harmonization of economic, fiscal, and 
monetary policies of member states; full integration of the financial structure;  pooling of foreign 
reserves;  and the establishment of a common moneta ry authority.  A coordinating body, comprising 
regional experts from central banks and Finance Mini stries, was formed to oversee implementation of 
policy measures and to advance the process of m onetary harmonization towards monetary union. 
34. Several institutions have been established to assi st COMESA members in their development.  
The Eastern and Southern African Trade and De velopment Bank (PTA Bank) provides trade and 
project financing to public and private investors domiciled in a bank member state, which includes 
Zambia.21  The COMESA Clearing House has diminished  in importance following liberalization of 
most members' foreign exchange regimes.  Its role is being re-directed towards improving the 
efficiency of clearing operations to complement the services offered by commercial banks;  providing 
traders with some form of political insurance on in tra-regional trade;  and facilitating monetary and 
fiscal policy harmonization within the region.  The PTA Re-Insurance Company (ZEP-RE) assists the 
development of the insurance and re-insurance industry in the COMESA region. Zambia is a 
signatory to the agreement establishing the Company,  and the Zambia State Insurance Corporation is 
a shareholder.  The Africa Trad e Insurance Agency (ATIA), launc hed in August 2001, is aimed at 
creating investor confidence by providing cover against political risk.  Although promoted by 
COMESA, membership of ATIA is open to all the member states of the African Union, formerly 
called the Organization of African Unity  (OAU).22  The COMESA Court of Justice became 
operational in 1998.  Its general jurisdiction is to ad judicate upon all matters that may be referred to it 
under the Treaty.  Zambia has not been involved in any formal disputes within this framework. 
35. The protocol on the free movement of persons is to be implemented in several stages; the first 
stage of removing visa requirements was adopted in  2000.  Several countries, including Zambia, have 
removed the visa requirements;  they are still ma intained by Angola, Burundi, the Democratic 
Republic of Congo, Djibouti, Egypt, Ethiopia, Madagascar, Rwanda, and Sudan. 
                                                      
19 "Value added" is defined as the difference between the ex-factory cost of the finished products and 
the c.i.f. value of material inputs imported from outside the COMESA sub-region.  The minimum level of value 
added was reduced from 45% to 35% in 2000.  Egypt and Uganda maintain the 45% ex-factory value-added 
level. 
20 A wide list of approved products is specified in the COMESA Treaty as being of particular 
importance to the economic development of the members. 
21 Not all COMESA members are members of th e PTA Bank:  Angola, Namibia, Seychelles, 
Swaziland, Uganda, and the Democratic Republic of the Congo are not members.  Egypt joined the Bank 
in 2000.  Since 1994, non-COMESA members may become PTA Bank members;  Somalia, Tanzania, and, 
since 2001, China are such members. 
22 Other founding members of ATIA, with Zambia, are Burundi, Kenya, Malawi, Rwanda, Tanzania 
and Uganda. Only Tanzania is a non-COMESA country.   WT/TPR/S/106 Trade Policy Review 
Page 20 
 
 
(b) Southern African Development Community (SADC) 
36. The SADC Treaty was signed in 1992 with the objective of creating a development 
community that would achieve economic integration, including trade.23  Through regional cooperation 
and integration, the Community aims to provide  balanced economic growth and development, 
political stability, and security for all member stat es.  Membership covers the countries of the 
Southern African Customs Union (SACU), i.e. Botswana, Lesotho, Namibia, South Africa, and Swaziland, as well as nine other countries.
24  The Treaty provides a framework to coordinate, 
harmonize, and rationalize policies, and to develop stra tegies for sustainable development.  It is based 
on the fundamental principles of sovereign equality of member states; solidarity, peace and security;  
human rights, democracy, and the rule of law;  and equity, balance, and mutual benefit.  Decisions 
and agreements are legally binding on members, and the Treaty provides for several protocols in 
specific areas, such as trade, finance, and investment. 
37. The Trade Protocol, signed in 1996, is aimed at progressively establishing a SADC free-trade 
area, initially over eight years.  However, progress has been slow.  The Protocol was not launched 
until September 2000, following ratification by 11 members, and came into force on 
26 January 2001.25  To establish the FTA, products have been grouped under three main categories 
(A, B, and C).26  Zambia has phased out duties on Cate gory A products (mostly capital goods and 
equipment) as required in the first year.  Category C consists of products deemed sensitive by member 
states, i.e. goods that individual member countries co nsider to require special protection because they 
are locally produced by infant industries, or ar e a source of substantial customs revenue, or are 
socially significant because they are a source of high employment.  These goods, limited to a 
maximum of 15% of each member's total merchandise tr ade, are to be liberalized from 2005 to 2012.  
Zambia has classified as sensitive certain copper products, cement, and motor vehicle parts.  In 
addition, a fourth category of products, Category E, covers products ineligible for preferential 
treatment under general and security exceptions permi ssible under Articles 9 and 10 of the Protocol.  
These are expected to make up a small list of pr oducts, so that by 2012 about 98% of SADC 
merchandise trade will be subject to zero tariffs .  The phase-down offers are country-specific.  
Implementation of the Protocol is based on the princi ple of reciprocity, i.e. tariff preferences will be 
extended only to member states that have submitted their instruments of implementation. 
38. SADC members made "differentiated offers" to non-SACU SADC countries plus Botswana, 
Lesotho, Swaziland, and Namibia, and "general o ffers" to South Africa.  Moreover, SACU members 
made offers to the other SADC members for immedi ate reductions to achieve zero tariffs after five 
years, except for sensitive products.  Differentiated offers heavily front-loaded tariff reductions, while 
general offers mid- to back-loa ded tariff reductions.  Offers by the other SADC members to South 
Africa thereby delay tariff reductions on category A and B products while they are heavily front-
loaded for non-SACU members and Botswana, Lesot ho, Swaziland, and Namibia.  Moreover, tariff 
reductions on the sensitive products (Category C) are further delayed from the eighth to the 
twelfth year.  This asymmetrical implementation is seen  as a means of enhancing equity in the region 
since South Africa, the principal SACU member, is far more developed than other SADC members.  
                                                      
23 SADC replaced the Southern African Development Coordination Conference (SADCC). 
24 These are Angola, the Democratic Republic of the Congo, Malawi, Mauritius, Mozambique, 
Seychelles, Tanzania, Zambia, and Zimbabwe. 
25 Angola, the Democratic Republic of the Congo, and the Seychelles have not yet signed the Protocol.  
Angola is expected to sign soon, and the Democratic Re public of the Congo has indicated its readiness to sign. 
26 Category B was further divided into three sub-categories.  Tariff rates are to be reduced gradually, 
commencing in the third year for sub-category B1 products;  in the fifth year for sub- category B2 products;  and 
commencing in the seventh or eighth year for sub-category B3 products.  Category A and B products cover an estimated 85% of goods traded among SADC members. Zambia WT/TPR/S/106 
 Page 21 
 
 
Zimbabwe and Mauritius also agreed to start th eir tariff reductions earlier than other non-SACU 
members.  All eleven SADC countries currently pa rticipating in the Trade Protocol have deposited 
their implementation instruments. 
39. Substantial progress has already been made on harmonizing customs and trade 
documentation.  SADC rules of origin are be ing negotiated in many cases on a product-by-product 
basis.  The rules of origin are therefore comple x and apply various origin  criteria across products. 
Protracted negotiations on specific rules of origin are continuing for certain products, including wheat 
flour; cereals and flour; plastics; electrical products and machinery; automobiles; and optical, photographic, measuring, and surgical instruments.
27  
40. Sugar is covered by a special ag reement annexed to the Trade Protocol and administered by a 
Technical Committee on Sugar.  This agreement includes the provisions on access to the SACU 
market for non-SACU SADC members, which include Zambia.28  It is based on non-reciprocal and 
duty-free-quota access for a period of five years (2001-05), after which it will be reviewed.  The 
SACU has offered a total quota of 20,000 tonnes as from 2001, supplemented by market growth 
allowances.  The quota is to be allocated am ong non-SACU sugar-producing SADC countries, based 
on a formula reflecting their world market sales to  non-preferential markets; the higher the latter the 
higher the annual quota allocation to the country.  Al locations are not transferable between countries, 
and unused quota will be reallocated only in situatio ns of force majeure.  The long-term objective of 
the agreement is to establish full liberalization of  trade in sugar within the SADC region from 2013. 
41. On textiles and clothing, a derogation has been granted to least developed members of  SADC 
(Malawi, Mozambique, Tanzania, and Zambia) allo wing them to export (duty-free but subject to 
quota) to SACU countries single-stage produced textiles and clothing, for five years (until 2005).29  
The duty-free quotas are on the basis of "single stage transformation" rule of origin, applied from 1 August 2001, for a period of five years.  E xports above the quota are subject to "double stage 
transformation" rule of origin.  There will be  a mid-term review of performance under these 
arrangements in 2003.  For Zambia, textile and clot hing exports constitute a smaller share of total 
exports of manufactures than for most other SADC LDCs.  Its quota entitlements each year for 2001 
and 2002 are:  1,700 tonnes of co tton;  390 tonnes of man-made staple  fibres;  60 tonnes of knitted or 
crocheted fabrics;  500 tonnes of articles of appa rel and clothing accessories, knitted or not, crocheted 
or not;  and 300 tonnes of other made-up textile artic les, sets, worn clothing and worn textile articles, 
and rags.   
42. While the Trade Protocol has identified several  non-tariff measures for elimination, such as 
import quotas, surcharges, customs procedures, a nd export subsidies, it excludes other important non-
tariff barriers, such as local-content requirements, levies and other border charges, and import (and 
export) licensing.
30 
43. The SADC Protocol on Tribunal provides for a tribunal to be established to adjudicate 
members' disputes arising from the treaty, and from s ubsidiary instruments, that cannot be settled by 
consultation.31  Its composition, powers, functions, pr ocedures, and other related matters are 
                                                      
27 For example, for electrical mach inery, some members want to prevent "single assembly" of white 
goods, while for plastics they want to prevent the use of imported plastic waste.  See Imani Development 
(Malawi) Ltd. (20001b), p. 24. 
28 Other non-SACU SADC members to which this  applies are Malawi, Mauritius, Mozambique, 
Tanzania and Zimbabwe. 
29 Coughlin and Undenge (2001). 
30 Imani Development (Malawi) Ltd. (2001a). 
31 Article 32 of the Treaty. WT/TPR/S/106 Trade Policy Review 
Page 22 
 
 
prescribed in the Protocol;  the Rules of Proce dure were agreed by SADC members in August 2000.  
Decisions of the Tribunal, when est ablished, will be final and binding.32  Actual creation of the 
Tribunal, however, will not take place until after th e conclusion of current reorganization plans for 
SADC.  In the meantime, for trade dispute issues,  Annex IV of the SADC Amendment Protocol of 
2000 provides a dispute settlement mechanism based on the WTO model. 
44. SADC intends to extend trade liberalization to services, but such negotiations are yet to 
commence.  The SADC Free Trade Area has not yet b een notified to the WTO.  However, the SADC 
Trade Ministers will be considering the issue at their meeting to be held in August 2002.  At issue is 
whether to notify under Article XXIV or the Enabling Clause. 
45. Zambia envisions both gains and losses from its  trade liberalization under the SADC Trade 
Protocol.  The gains include: increased market access to the region and the related benefits;  relative 
source of affordable inputs and capital goods;  and tr ansfer of technology.  The losses include:  loss of 
public revenue;  and closure of some compani es (as a result of competition from imports) and the 
related consequences. 
(c) Regional Integration Facilitation Forum (RIFF) 
46. The Regional Integration Facilitation Forum (R IFF), formerly known as the Cross-Border 
Initiative (CBI), aims to move member countri es (including Zambia) towards increased economic 
integration by facilitating private investment, tr ade, and payments between them, as well as 
cross-border mobility of labour and capital.  Member  states are the countries in eastern and southern 
Africa and the Indian Ocean.33  The RIFF was developed in close collaboration with the economic 
integration organizations in the region.  As a foru m, the RIFF is to reinforce and complement efforts 
undertaken by these organizations.  Launched in 1 992, the RIFF is co-sponsored by the European 
Commission, the International Monetary Fund, the World Bank, and the African Development Bank.  
It has no Secretariat at the regional level and works on a voluntary basis. 
(d) The African Union (AU) and African Economic Community (AEC) 
47. The African Union, launched in July 2001, re placed the Organization of African Unity (OAU) 
in July 2002.  The Charter establishing the OAU was signed by 30 African nations on 25 May 1963.34  
Zambia, like the other members of the OAU, signed the Abuja (Nigeria) Treaty Establishing the AEC in June 1991, as provided for by the 1980 Lagos Pl an of Action.  Its main aim is to promote 
integration and harmonization within Africa.  The Treaty provides for the creation of a pan-African 
economic and monetary union (with a parliament) in six stages, over a period of 34 years.  The organs 
and headquarters of the AEC are those of the AU.  The AEC's activities have not yet fully 
commenced. 
(iii) Other agreements and arrangements  
48. Zambia is negotiating bilateral trade agreements  with Botswana, the Democratic Republic of 
the Congo, Mozambique, Namibia, Tanzania, and Zimbabwe. 
                                                     
 
32 SADC online information.  Available a t:  http://www.sadc.int/overview/works.htm. 
33 Other participants are Burundi, Comoros, Kenya, Madagascar, Malawi, Mauritius, Namibia, 
Rwanda, Seychelles, Swaziland, Tanzania, Uganda, and Zimbabwe.  Mozambique has indicated its intention to 
join. 
34 Almost all African countr ies are members of the AU. Zambia WT/TPR/S/106 
 Page 23 
 
 
49. Zambia benefits from non-reciprocal pref erential treatment from many industrialized 
countries under the Generalized System of Preferences (GSP).  The EU’s Everything But Arms (EBA) Initiative, implemented from March 2001, has extended duty- and quota-free access to  
imports of all products from least de veloped countries, except for arms.  Extension of this preferential 
treatment to sugar, rice, and fresh bananas will follow specified schedules.
35  The Cotonou Agreement 
and the African Growth and Opportunity Act (AGOA) provide for non-reciprocal preferential 
treatment for certain developing countries,  including Zambia (sections (a) and (b)). 
50. Zambia is not a signatory to the Agreement on the Global System of Trade Preferences 
(GSTP) among developing countries.  Zambia is  a member of the Common Fund for Commodities 
(CFC), the International Coffee Organization (ICO), and the International Sugar Organization (ISO).  
(a) The Cotonou Agreement 
51. Zambia is a signatory to the Cotonou Agre ement (successor to the Lomé Convention) 
between the EU and 77 countries in Afri ca, the Caribbean, and the Pacific (ACP).36  The Agreement 
maintains most non-reciprocal trade prefer ences granted by the EU to ACP States37, and has been 
ratified by Zambia.  At the Doha Ministerial Conference, WTO Members granted the waiver 
requested by the parties to the Agreement from th e obligations under Article I:1 of GATT 1994 (MFN 
treatment), for the period up to 31 December 2007.38  By then, new WTO-compatible trading 
arrangements are to be concluded, removing barrier s progressively between the parties and enhancing 
cooperation in all areas relevant to trade, incl uding the formation of fr ee-trade areas within a 
transitional period.  During this period, the EU is to enter negotiations with  ACP countries, scheduled 
to start in September 2002, aimed at establishing partnership agreements on  a bilateral basis or 
between the EU and regional groupings (regional eco nomic partnership agreements) to commence by 
January 2008 at the latest.  These would be based on  reciprocal liberalization, thereby requiring in 
principle Zambia and other ACP states to extend preferential access progressively to EU exports. 
52. Under the Cotonou Agreement, the EU grants  non-reciprocal trade preferences to most 
imports originating in ACP states, subject to a safeguard clause and rules of origin.39  For certain 
products (bananas, beef and veal, and sugar),  the EU provides special market access under 
"commodity protocols".  The Cotonou Agreem ent abolished STABEX, SYSMIN, and the Rum 
Protocol of the Lomé Conventions. 
53. The EU is an important market for Zambia's non-traditional exports (NTEs);  it took 33% of 
the total value of NTEs in the first half of 2000,  although this declined to 28% during the same period 
of 2001.  Like many other ACP countries, Zambia's  sugar exports are covered by the Sugar Protocol, 
under which Zambia is allocated and fully uses special quota access to the EU of 12,000 tonnes 
annually, at prices higher than the world levels.  Unlike many ACP countries, however, the 
                                                      
35 WTO (2002);  and Europa online information.  Available at:  http//europa.eu.int/comm/trade/miti/ 
devel/eba4.htm. 
36 The Cotonou Agreement was signed on 23 June 2000.  The fourth Lomé Convention had expired at 
the end of February 2000.   
37 South Africa was excluded from most of the provisions of the Lomé Conventions and now the 
Cotonou Agreement, but has a separate Trade Development and Cooperation Agreement with the EU, signed in October 1999, which provides for asymmetrical trade liber alization between the two parties to form a free-trade 
area by 2012. 
38 WTO document WT/MIN(01)/15,14 November 2001.  The full text of the Cotonou Agreement was 
communicated to WTO Members (WTO document G/C/W/187/Add.3 of 14 April 2000). 
39 The rules of origin require that qualifying products be either "wholly obtained or significantly 
worked or processed" in one or more  ACP states.  The latter definition is based on the product being sufficiently 
modified in the ACP state for it to be classified  under a different four-digit HS tariff line. WT/TPR/S/106 Trade Policy Review 
Page 24 
 
 
Sugar Protocol, covers (according to the authoriti es) only a small portion of total sugar exports from 
Zambia, and the conditions on the world market are a d ecisive element in the level and stability of its 
sugar export earnings.  Moreover, the recent Ever ything But Arms" (EBA) Initiative, which grants 
additional preferences to all least developed countries40, and the EU's own multilateral tariff 
reductions have eroded the preferential margins. 
54. Zambia received financial as sistance from the EU under, inter alia , the European 
Development Fund (EDF);  the European Investme nt Bank for commercial loans;  and the National 
Indicative Programme (NIP). 
(b) The African Growth and Opportunity Act (AGOA), and other arrangements 
55. The African Growth and Opportunity Act (AGOA), contained in the U.S. Trade and 
Development Act of 2000, offers free access to so me manufacturing products originating in African 
countries.  A high-level dialogue on trade and i nvestment under the U.S.-Sub-Saharan Africa Trade 
and Economic Forum has also been established.  Af rican countries eligible for preferential treatment 
under the AGOA will receive GSP treatment in the U. S. market (exempt from the competitive needs 
limitations) until the end of September 2008, and will qualify for an expanded list of GSP products 
(beyond that available to other countries).41  All eligible African count ries are entitled to unlimited 
duty-free and quota-free access to the U.S. market for apparel made from U.S. fabric, yarn or thread.42  
Less developed countries, including Zambia and 27 ot her eligible African countries with a per capita 
GNP below US$1,500 in 1998, may use non- U.S. fabric until end-September 2004.43 
56. To be eligible, African countries must ma ke progress in establishing a market-based 
economy; developing political pluralism and the rule of law;  eliminating discriminatory barriers to 
U.S. trade and investment;  protecting intellectual property;  combating corruption;  protecting human 
and worker rights;  and removing certain practices of child labour.44  Although the apparel benefits in 
principle took effect from 17 October 2000, countries mu st have in place an effective visa system to 
prevent illegal transshipment and use of counterfe it documentation, as well as effective enforcement 
and verification procedures.  Zambia completed th e changes necessary to meet these requirements to 
the satisfaction of the U.S. authorities, and became eligible to export garments under these 
arrangements on 17 December 2001.  Although ma ny other products, including certain processed 
agricultural goods, are covered by the AGOA, some of Zambia's major agricultural products are yet to 
make it into the AGOA list, due, according to the aut horities, to lengthy inspection procedures in the 
U.S. Department of Agriculture. 
(6) INVESTMENT POLICIES  
57. The 1993 Investment Act, as amended in  1996 and 1998, promotes investment, 
including foreign direct investment, mainly in productive activities.  Articles 16(1) of the 
Constitution, and 35(1) and (2) of the Act provide fo r the protection of investments.  In accordance 
with the Act, no property or interest in right over property can be compulsory acquired, except for 
                                                      
40 See WTO (2002) for details. 
41 The list of manufactured goods (some 1,800 tariff lines) covered by AGOA includes products such 
as footwear, luggage, handbags, and watches. 
42 The legislation provides for an upper volume limit on such imports, rising from 1.5% of "aggregate 
square metre equivalent" of all U.S. apparel imports to 3.5%, over an eight-year period. 
43 Countries must also be beneficiary developing countries under the U.S. GSP scheme. 
44 African Growth Opportunity Act [Online].  Available at:  www.agoa.gov/index.html. Zambia WT/TPR/S/106 
 Page 25 
 
 
public purposes under an Act of Parliament a nd against prompt payment of compensation.45  T h e  
focus of the Government in recent years has been  to accelerate economic growth.  Various incentives, 
including tariff and tax concessions, are provided for this purpose (Chapter III(4)(i)).  Efforts are also being made to provide adequate infrastructure, with an emphasis on roads and bridges, dams, and 
airports.   
58. The Investment Centre, established in Janua ry 1992, coordinates government policies on 
investment, and promotes and facilitates investment into Zambia.  The Centre processes applications 
for investment certificates in all economic are as, except financial services, and the mining and 
quarrying sector.  Through the auspices of the Mini stry of Local Government and Housing, it also 
assists local districts to formulate investment profiles destined to attract investments in their region.  
The Centre is under the authority of the Invest ment Board (established under the 1993 Investment 
Act) which, inter alia , formulates investment promotion stra tegies, and establishes investment 
guidelines for the Centre.
46  The Chairman and Vice-Chairman of the Board are elected from among 
its members.  The Board appoints a Director-General as th e chief executive officer  of the Investment 
Centre. 
59. Applications for investment certificates are ma de to the Director-General and must be 
accompanied by a detailed business plan and a non -refundable processing fee equivalent to US$250 
plus VAT at 17.5%.47  The Centre then arranges licences, authorizations, or permits from the relevant 
Ministry or body responsible for the sector in whic h the investment is to be made.  In the case of 
prospective companies, registration with the Regi strar of Companies (Ministry of Commerce, Trade 
and Industry) and a minimum capital of K 500,000 are required.  The registration fee amounts to 2.5% 
of the nominal capital plus K 31,000.48  Moreover, the 1994 Companies Act requires, inter alia , that 
more than half of any company's directors must be resident in Zambia.  The 2000 amendment (Act No. 1 of 2000), however, reduced this requirement to at least 30% for companies that signed a development agreement with the Za mbian Government, in terms of the Mines and Minerals Act, after 
1 February 2000. 
60. The Director-General submits the applications  to the Investment Board, which within 
six weeks of receipt, issues the certificate, provide d that the application and the planned activity do 
not contravene any laws or regulations in force in Zambia.  The decision of the Board in respect of an 
application must be communicated to the applicant in  writing within 14 days of the decision.  In the 
event of rejection, the reasons must be communicated  to the applicant in writing, who may appeal to 
the Minister of Commerce, Trade and Industry and subsequently to the High Court.  An investment 
certificate has an unlimited period of validity, provided  it is utilized within 12 months from its date of 
issue.  A uniform fee of US$1,500 (plus the 17.5% VAT) is charged, regardless of the size of the 
investment.
49 
                                                      
45 The compensation must be made at the market va lue and be fully transfer able at the applicable 
exchange rate in which the investment was originally made. 
46 The Board consists of a senior representative from  each of the ministries responsible for Finance and 
Economic Development;  Commerce, Trade and Industry;  Legal Affairs;  Land;  Home Affairs;  Tourism;  and Agriculture;  it also includes a repr esentative of the Environmental Counc il of Zambia, one representative each 
from the Chambers of Commerce and Industry, the farmers, the Non-governmental Organization Coordinating 
Committee, and the agencies promoting small-scale industries, and three pr ivate businessmen appointed by the 
Minister of Commerce, Trade and Industry. 
47 The investment certificates are required for incentive purposes. 
48 U.S. Department of Commerce (1999). 
49 See WTO (1996) for details on the evolution of the fee. WT/TPR/S/106 Trade Policy Review 
Page 26 
 
 
61. Zambia ratified the Multilateral Investment Guarantee Agency (MIGA) Convention, and 
signed bilateral agreements for reciprocal protecti on of investments, with Switzerland in 1994, and 
with the People's Republic of China in 1996.  Up  to 1998, Zambia had double taxation agreements 
with:  Canada, Denmark, Finland, France, German y, Holland, India, Ireland, Italy, Japan, Kenya, 
Norway, Romania, South Africa, Sweden, Switzer land, Tanzania, Uganda, and the United Kingdom. 
(7) TRADE -RELATED TECHNICAL ASSISTANCE  
62. Like other LDCs, Zambia has regular recourse to technical assistance, provided by the WTO 
and other international agencies, in areas rangi ng from the implementation of WTO Agreements to 
supply-side constraints.  A prima facie identification of Zambia's technical assistance needs was 
undertaken in 1997/1998 in the context of the Integr ated Framework (IF) for Trade-Related Technical  
Assistance.50  This assessment was to serve as the starti ng-point for global trade-related technical 
assistance proposals during a round table that was to be held in 2000.51  The Government organized a 
stakeholders meeting on 11 April 2001 to define a common vision for trade as part of the IF process 
for Zambia.  In the preparation of the WTO 2003 Technical Assistance Plan, Zambia submitted its 
requests for technical assistance and a cale ndar for execution of proposed activities.  
63. Like other LDCs, Zambia's difficulties to full y benefit from its participation in the WTO 
relate mostly to supply-side constraints, unstable world prices for its main mineral products, and to the 
implementation of various provisions of the WTO Agreements.  The implementation-related 
difficulties are attributed to various factors, in cluding a lack of capacity of the  implementing 
agencies.  Specific areas of need are:  (i) implementation of legislation;  (ii) financial and 
administrative means to implement WTO Agreements;  (iii) notification requirements;  (iv) training of 
government officials on WTO matters; (v) capacity building for negotiations;  and (vi) reference 
centre.  While assistance h as been provided by the WTO Secretar iat as well as by other agencies, in 
particular WIPO, UNCTAD, and the World Bank, Zambia would continue  to require further 
assistance in implementing the WTO Agreements, in particular on Technical Barriers to Trade (TBT) 
and on the Application of Sanitary and Phytosan itary Measures (SPS), and in capacity building, 
taking into account developments that have occu rred in the multilateral trading system, notably the 
work programme arising from the WTO Minister ial Conference of Doha in November 2001. 
(i) Implementation of legislation 
64. Zambia's specific implementation-related c oncerns are in anti-dumping and countervailing 
measures, trade-related aspects of intellectual property rights (TRIPS), and customs valuation. 
65. In June 2002, Zambia made a request to th e WTO Secretariat for technical assistance in 
drafting a WTO-consistent law on safeguards.  Inte rministerial consultations are under way in this 
respect (Chapter III(2)(vi)).  The Zambian authorities ar e of the view that the most useful assistance 
would come from other Commonwealth countries that have a similar legal system and experience in 
administering independent bodies, capable of training Zambian officials on how to conduct 
investigations and handle findings, based on the rules and procedures established by the WTO 
Agreements on contingency trade remedies. 
66. With respect to intellectual property rights (IPRs ), while Zambia intends to comply with the 
TRIPS Agreement by 1 January 2006, there is a general recognition within entities like the Patents 
and Companies Registration Office that the process is technically challenging and time consuming.  
Also, the inadequacy of domestic expertise on IPR matters has prevented the Government from 
                                                      
50 The IF is still a prototype stage. 
51 WTO document WT/LDC/HL/1/Rev.1, 23 October 1997. Zambia WT/TPR/S/106 
 Page 27 
 
 
initiating further steps towards implementation of the Agreement.  Because responsibility for TRIPS 
issues is dispersed among several government ag encies/entities, there are some difficulties in 
coordinating the work that would be required to bri ng Zambia's legislation and regulations into full 
conformity with the TRIPS Agreement. 
67. Most provisions of the relevant WTO Customs Valuation Agreement are being implemented. 
However, there is no appeal process for importers to  appeal valuation decisions made by the Zambia 
Revenue Authority;  an appeal me chanism needs to be established. 
(ii) Financial and administrative means to implement WTO Agreements  
68. Full implementation of Zambia's WTO obligati ons (mainly with respect to SPS and TBT, 
including legal metrology) is being hampered by the lack of financial, human and technical resources.  
On TBT, the Zambia Bureau of Standards (ZABS)  has submitted detailed requests for assistance.  
ZABS has stressed that it had not operated effectively as a focal point due to, inter alia , lack of 
technical resources such as communication and repr oduction equipment.  Consequently, Zambia has 
not been able to fully meet the requirements of th e TBT Agreement with respect to notifications and 
general dissemination of information.  For the en quiry point to function effectively, it will need 
assistance to acquire at least a computer, a modem, a laser printer, a server with a reasonable storage 
capacity, and a medium- to high-quality photocopier .  There is scope to extend ZABS' activities 
(e.g. to legal metrology for the protection of consumers in particular) or to develop quality 
requirements for exports (in terms of compliance with  foreign standards), but substantial financial and 
technical assistance may be required, inter alia , to develop facilities for testing various import and 
export products, as well as to support the developmen t of national standards.  Calibration services in 
new fields (e.g. volume, force, temperature, electri city, time and frequency), should also be developed 
as they are important for industrial production, as we ll as to strengthen the existing mass, pressure and 
length calibration facilities with additional equipment.   ZABS' Information and Documentation Centre 
requires larger production and storage facilities, si nce its information management system is not 
computerized.  Computerization of the system could be associated with the establishment of a website 
to disseminate information on standards. 
69. The Assays Department also needs technical assistance to increase its capacity to meet 
national needs for metrology services through incr eased coverage and professional handling of its 
activities.  Apart from training of metrologists, this  implies:  (a) acquiring measurement standards and 
test measures, e.g. establishing offices and laboratori es, temperature-control units, standard equipment 
mass, comparator balances, volume standards, master meters, a water meter test rig, testing 
equipment, and test products directly used in ve rifications;  (b) acquiring vehicles for logistical 
support;  and (c) developing information systems, including acquisition of computers and relevant 
equipment. 
70. On SPS measures, a drastic lack or obsolescence  of equipment, and a lack of financial 
resources were reported.  The lack of financial res ources limits Zambia's participation in the activities 
of international institutions dealing with SPS issues.  It  is important that the relevant infrastructure  is 
upgraded to ensure that Zambia's SPS measures are WTO-consistent, i. e. based on scientific evidence.  
The following laboratories need to be up-graded or built:  the Plant Quarantine Laboratories and Bio-
systemic, the Herbage Chemistry (HC) Laboratory, the Seed Health Testing and Control Laboratory, 
the National Institute for Scientific and Indus trial Research, and the National Food and Drugs 
Laboratory.  It has also been stressed that cr eating an appropriate data base to handle SPS-related 
issues, and facilitating access by the technical depa rtments to relevant scientific and technical 
information are crucial for the future.  The needs are specified for each SPS implementing department 
and relate, in particular, to quarantine faciliti es at border points, office equipment, laboratory WT/TPR/S/106 Trade Policy Review 
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equipment and reagents, and computer and ancillary equipment.  In July 2002, the WTO organized a 
national seminar on SPS issues in Zambia. 
(iii) Notification requirements 
71. According to the authorities, difficulties in meeting the notification requirements are due 
mainly to their scope and complexity.  The Minist ry of Commerce, Trade and Industry is responsible 
for the coordination of notification requirements.  To date, Zambia  has met less than one third of its 
notification obligations under the WTO Agreements .  This stems from difficulties in coordinating 
notification requirements among governmental entities.   While assistance has been provided by the 
WTO, COMESA, and Commonwealth Secretariats, additional assistance may be required to help 
Zambia to meet these obligations. 
(iv) Training of officials 
72. WTO technical assistance has so far focused on increasing the general understanding of WTO 
matters by government officials.  Since 1995, ve ry few national activities have been organized in 
Zambia, mostly on the multilateral trading system (MTS).  In addition, although several officials from Zambia have participated in the 12-week Trade Po licy Courses, and in the three-week (Short) Trade 
Policy Courses designed for LDCs, this has not pr oduced enough Zambian experts in issues relating 
to the multilateral trading system, mostly because of the volatility of tenancy.  Indeed, some of the 
Zambian experts in WTO issues, who were concentr ated in the Ministry of Commerce, Trade and 
Industry, have left, and this has created a vacuum.  According to the authorities, any action that may 
reinforce capacity-building in the Ministry, as we ll as in other technical Ministries, would be 
welcomed.  In a general manner, it was stated that  there should be more seminars at national or 
regional level.  Training courses are also necessary to  continue the familiarization of officials with 
MTS Agreements. National seminars/training courses should be open to all mi nistries involved in 
trade-related issues, in particular those with lim ited knowledge of WTO issues in their own areas of 
activity. 
73. In general, capacity-building activities on th e WTO system and on specific Agreements 
should be organized for the different ministries and entities concerned, as well as for the private 
sector, universities, and the media.  Capacity-bui lding activities for the private sector would be 
different from those envisaged for ministries and uni versities. Joint actions with other organizations 
such as the International Trade Centre might be envisaged.  
74. ZABS has requested general (technical and ma nagerial) training on TBT for its staff.  
Requests were also made for assistance in deve loping certification schemes for quality management 
systems based on ISO 9000, and the environmental management system based on IS0 14000.  The Assays Department has also request ed in-depth training of metrologists through seminars, short- and 
long-term courses in metrology, and modular traini ng programmes.  Departments dealing with SPS 
have mentioned the need for long-term training in public health and epidem iology, and short-term 
training in international trade and SPS issues, in quarantine management, and in laboratory 
techniques. 
75. The entities/enterprises dealing with competiti on policy and TRIPS matte rs, which have only 
a limited number of IPR legal experts, have requested assistance from the WTO, WIPO, and the African Regional Industrial Property Organization (ARI PO).  There is an urgent need to develop 
knowledge and skills on TRIPS in the following entiti es:  the Patents and Companies Registration 
Office, the Copyright Office, and the Zambia Musi c Copyright Protection Society.  Assistance has 
been requested to coordinate efforts on IPR issues an d to train the staff of the Copyright Office in the 
latest monitoring techniques (including the use of information technology for effective copyright Zambia WT/TPR/S/106 
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administration).  Capacity-building on TRIPs matters , through, training and other assistance, is also 
required for other public entities, such as the Za mbia Revenue Authority and police officials. 
76. On capacity-building within ministries/govern ment entities, the Zambia Revenue Authority 
suggested that support be given to in-house traini ng activities based on the concept of training of 
trainers.  In addition to assistance provided by th e World Customs Organization and New Zealand in 
recent years, pedagogical materials and documentati on would be welcomed.  An overall request for 
computers and informatics training was made by most ministries and entities involved in trade-related issues.  This training assistance may be provided under the WTO 2003 technical assistance plan of 
action. 
(v) Negotiating skills  
77. The weakness of government officials' negotiati ng skills is another constraint to Zambia's 
participation in the multilateral trading system.  Zamb ia's diplomatic representation in Geneva has two 
officials who participate in WTO meetings.  The workload relating to negotiations under the Doha 
Development Round is expected to be (at least) equivalent to that undertaken during the Uruguay 
Round.  Workshops on various subjects, including  negotiation techniques and skills, might be very 
useful, even at a regional level (e.g. COMESA or SADC). 
78. In the context of the Doha Work Programme , assistance might be necessary on "Singapore 
issues" (namely trade and competition, trade and investment) and on rules.  Such assistance would 
consist of specialized seminars on, and impact studies of, possible agreements in these areas for 
Zambia and other COMESA members.   This should also cover how the likely impact of autonomous 
liberalization measures could be taken into acc ount during market-access negotiations, and possible 
renegotiations under Article XXVIII of GATT 1994 following the implementation of COMESA's 
common external tariff. 
79. Financial assistance was requested to facilitate Zambia's participation in the sessions of the 
WTO Trade Negotiations Committee and in the negotiations on agriculture and services. 
(vi) Other areas 
80. Zambia requests financial assistance to fully e xploit its Reference Centre established by the 
WTO.  The assistance will finance, inter alia , internet access and the replacement of the toner for the 
printer. 
81. In June 2002, Zambian authorities asked to be in corporated in the Join t Integrated Technical 
Assistance Programme (JITAP), a joint ITC/UNCTAD/WTO programme, launched on an 
experimental basis and covering eight African count ries.  The JITAP is designed to help eligible 
countries to improve/build national capacities, and he lp the private sectors to take advantage of new 
market opportunities.  JITAP may be extended to additional countries or terminated at the end 
of 2002.