By Edward Chisanga
Introduction
As I said in one of my recent past articles, Vision 2030 was created in 2006 under President Levy Mwanawasa to bring a prosperous and middle-income nation. Inside it, there’re largely two parts, economic and non-economic issues. In this article, my colloquy with the reader in general, and government, the main protagonist of Vision 2030 focuses on the economic part, in which Vision 2030 uses growths of Gross Domestic Product (GDP), GDP per capita and inward FDI as key inputs towards achieving a prosperous and middle-income nation.
In this article, as always, I use Unctadstat statistics, as my main methodology in explaining Vision 2030’s economic dreams against reality on the ground.
Gross Domestic Product (GDP)
Expectation 1
Achieve GDP growth of
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6% for 2006-2010.
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8% for 2011-2015;
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9% for 2016-2020 and
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10% for 2021-2030.
My first point is that if these economic growth dreams had become a reality since 2006 to date, perhaps Zambia today would’ve been heading towards attainment of Vision 2030. But, they did not. And they’ll not, given that there’re only six years remaining before we reach 2030. I’ve also openly stated before that the 8th National Development Plan (8th NDP) provides a section on Vision 2030 performance and here, I complement it with additional statistics such as on GDP per capita and FDI.
As can be seen in Figure 1 below, in the first 2006-2010 of its journeys, the economic part of Vision 2030 performed exceptionally well, registering high trend of real GDP growth that even surpassed projected growths. If this good trajectory had continued, the nation’s economic performance would have been excellent. Let me also share with you what’s called variance in planning, which is the difference between targets of Vision 2030 and real GDP or economic reality. From the graph, you can that the gulf between the two is huge, in particular in 2020, that’s the difference between 9% and minus 3%.
Unfortunately, from 2010 on, Vision 2030’s performance was a shadow of itself, with real GDP growth taking a continuously contracting path, even with an episode of huge negative growth of almost 3% in 2020. As I said, the 8th NDP notes, ““Another notable development was in 2020 when economic growth contracted by 2.8 percent, registering the first recession since 1998.” It also states, .“The average real GDP growth of 5.2 percent attained over the period 2006 to 2021, falls below the Vision 2030 target of between 6 to 10 percent. Growth will, therefore, have to be significantly higher over the next two Plan periods to attain the aspirations of the Vision 2030.”
My verdict is that since this statement by the 8th NDP, there’s not been any significant developments that can carry on their shoulders, Vision 2030 towards a prosperous and middle-income nation. Today, the road is even more bumpy, given the energy crisis and its negative effect on industry, manufacturing and other business. The media statement from the Zambia Chamber of Commerce and Industry (ZACCI) of end of 2024, “State of Commerce and Industry in Zambia amid current challenges” summarizes exactly what I’m talking about here.
Economic growth must support industry and vice versa. But when GDP faces continuous contracting trend, it doesn’t support industry just as weak industry does not support GDP.
Gross Domestic Product (GDP) per capita
Expectation 2
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3% for 2006-2010.
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6% for 2011-2015.
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7% for 2016-2020.
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8% for 2021-2030.
To supplement the 8th NDP, I have included Vision 2030 targets on GDP per capita growths shown in Figure 2 below. It’s important because it directly affects households. When it grows continuously and robustly, it can contribute to increased purchasing power, just as it will not when its not growing robustly. That affects money in the pocket for purchases, and this is typical of what we’re seeing in our country.
As GDP, real GDP per capita relative to targets too underperformed miserably. As can be seen in the graph, again, except for years 2006-2010, this expectation too has not been realized since real GDP growth line is perpetually below that of expectation, even with an episode of a significant negative contraction of about 6 per cent in 2020. It’s only in 2022 that we begin to see one ray of hope, when growth suddenly rose from minus 6% to 4% in 2022. Unfortunately, no sooner did it go up than it tumbled down to 0% the following year.
Again, here, as you can see, the variance is equally huge, in particular between target growth of 7% and minus 6% in 2020. That itself justifies my point that any future growth will simply be filling this huge abyss that we see manifested in the difference between targets and real growth. So, it’s unfair to brag in 2022 that GDP per capita grew to 4% without comparing to previous years of bad growth.
Equally, that’s why I have always said that the so-called Zambia’s economic transformation narratives and speeches I always hear are not simply going overboard but are hardly helpful. Zambia is in a long haul to redemption.
The words, economic transformation make sense not here, but in Viet Nam which has attained the middle-income nation character and overtaken Africa in global exports of manufactured goods.
For both GDP on the one hand, and GDP per capita on the other, bad growth took almost ten years. Therefore, as I have said before, the goal of any future economic growth is to simply fill the abyss of the ten-year bad growth.
Expectation 3
Encourage Foreign Direct Investment in productive sectors
I also include FDI in my assessment of Vision 2030. The expectation is as stated above. My first comment is that this expectation is wrong because, “encourage” is not a target. The correct thing would have been something like, “Increase inward FDI flows by 5 % or in monetary terms, eg, by $500. However, my assessment and second point shows, as in Figure 3 below, that inward FDI flows into our nation faced severe hardship. You can clearly see the trending years from 2013 – 2022 show deep growth contractions. My third is that I cannot tell if this contraction is in the productive sector. In any case, it’s not growing FDI. Again, just as the economy is not contributing to inward FDI flows, FDI flows are not to the economy.
Sector performance
Like GDP, Vision 2030 sector performance leaves a lot to be desired. I’ve not included sectors like agriculture, manufacturing, energy, technology and others here although I’ve done individual assessment on each but space cannot allow me to put them in this article. The message is that none of them is doing well. The share of agriculture value added in GDP has been shrinking as that of manufacturing too has not performed according to plan. Hence, the sector disappointment to GDP is equally so for GDP to sector disappointment.
Concluding
In economic governance, including Vision 2030, the lesson is that humility, honesty and accountability are key. Vision 2030’s inflated goals are not going to be achieved. My suggestion is that in future, plans must focus on inputs that make development, not development. In other words, let’s have Vision 2030 or 2050 and target inputs like building infrastructure, human capital, manufacturing, technology, energy, etc. Forget about frivolous wordings like, “Prosperous and middle-income” as outcome. Once inputs are established, prosperity will be easy.
Finaly, I’m disappointed with authors of Vision 2030 for misleading the Head of State into appending his signature to it. Future Heads of State must learn from this and avoid doing the same. They must append signatures to things they know will work. Targets of Vision 2030 are not only inflated. More importantly, I don’t know on what country conditions they’re based when the economic and development foundation is so weak. Unfortunately, it’s the same for strategic plans in public institutions. High hopes, low ending.
