Further investments in Zambia’s physical infrastructure are essential to attracting heightened levels of private sector investment and economic growth, while also helping to realise the national goal of poverty reduction.

All economic sectors depend on reliable and affordable utilities as well as modern and efficient communications and transport systems. Positive growth in the priority economic sectors of agriculture, mining, tourism and manufacturing has helped to drive further expansion in Zambia’s physical infrastructure. Government supports improvements to infrastructure by accelerating the implementation of structural reforms and investing in key areas such as roads. A sum of K1 181.4 billion was set aside in the 2008 budget for improvements to transport infrastructure.

CONSTRUCTION

Robust growth in the construction sector over the past few years has been stimulated by public infrastructure works coupled with private sector construction, with investment having taken off since the liberalisation of the economy and the creation of a more enabling business climate.

Preliminary results indicate that the construction sector continues to register positive growth, which amounted to 13.3 percent in 2007, slightly lower than the 14.4 percent recorded in 2006. The favourable performance in the sector is driven by construction of residential housing, investments in the mines, road construction and other civil works, reflecting strong economic growth and rising incomes.

HOUSING

Housing has been declared a priority sector by government in recognition of the fact that decent housing or shelter is a basic human need, and that home ownership is a form of wealth creation. Rapid population growth combined with rural-urban migration has resulted in a greater demand for housing, particularly in Lusaka, as well as increased pressure on existing infrastructure.

TRANSPORTATION

In view of its landlocked status, Zambia’s road, rail and air transport networks are critical to national and regional development. In addition to facilitating the influx of businesspeople and leisure tourists, an efficient transport infrastructure is pivotal to trade. Road and rail transport are traditionally the most widely used transport modes, although inland water transport is also used.

Increased passenger services have driven growth in the road transport subsector in recent years. With roads seen as being most effective in the transportation of goods, the subsector is expected to register further growth as the region’s markets become better integrated and trade increases.

The transport, storage and communications sector continued to perform well during 2007, with output increasing by 22.5 percent compared to 22.1 percent in 2006. Negative growth was however recorded in the rail transport subsector, mainly due to the poor state of infrastructure.