Policy paper

UK–Zambia development partnership summary, July 2023

Published 17 July 2023

Introduction

The Strategy for International Development (IDS) places development at the heart of the UK’s foreign policy. It sets out a new approach to development, anchored in patient, long-term partnerships tailored to the needs of the countries we work with, built on mutual accountability and transparency. This approach goes beyond aid and brings the combined power of the UK’s global economic, scientific, security and diplomatic strengths to our development partnerships. Our 4 priorities are to deliver honest, reliable investment, provide women and girls with the freedom they need to succeed, step up our life-saving humanitarian work, and take forward our work on climate change, nature, and global health. The Integrated Review Refresh (IR23) reiterates that sustainable development is central to UK foreign policy and sets out how the UK will go further and faster on development to reduce poverty and reinvigorate progress towards the SDGs. This Country Development Partnership Summary details how the IDS and IR23 will be put into practice with Zambia.

Country context

Sixty percent of Zambia’s 20 million people live in poverty. Inequality is very high and, on current trends, it will take until 2060 to reduce poverty to 30%. Weak transmission of Zambia’s economic growth to poverty reduction is the central development challenge.

Long known for the strength of its democracy, Zambia has experienced 3 democratic transitions between political parties since the 1990s. Zambia remains peaceful and stable and its abundant natural resources provide potentially significant opportunities for building prosperity and inclusive development. A decade of strong growth in Gross Domestic Product (GDP) on the back of high copper prices meant that, in 2011, Zambia graduated to Lower Middle-Income Status. However, Zambia still faces significant economic challenges and, in 2022, it slipped back to Low Income Status, driven by slower growth and demography.

Rates of child stunting are some of the highest in the world and more than South Sudan. One in 17 children still die before their fifth birthday, on par with Burundi and Yemen. The country is on track to have the third highest number of people in Africa below the $2.15 poverty line by 2060 (source: ODI/University of Denver). World Bank (WB) evidence suggests that Zambian Women and Girls are disproportionately impacted by extreme poverty, including lower education, health and nutrition outcomes, and land access.

Zambia is extremely vulnerable to climate change. Adapting to a changing climate is an urgent challenge and significant risk to poorer Zambians, especially the majority who are reliant on rainfed subsistence agriculture and the natural environment.

Government’s vision for Zambia’s strategic direction and development priorities are set out in Zambia’s Eighth National Development Plan. This Development Plan aims to stabilise the macro-economic situation, returning Zambia to a sustainable debt burden, as well as improving services and tackling poverty. It aims to drive private sector investment into high potential sectors such as agriculture, manufacturing, tourism, and extractives, including a target to more than triple annual copper production to 3 million tonnes.

Why and how: the UK’s development offer with Zambia

Zambia’s high rates of poverty and inequality mean our development programme is focused on supporting Government’s ambition to reduce extreme poverty. To do this, we have aligned our support to Zambia’s eighth National Development Plan. We work directly to improve the services that reach the most vulnerable communities through nutrition, social protection, health, and education. Our approach also works upstream, helping Zambia to create the jobs and growth it needs to deliver long-term poverty reduction.

The UK’s development collaboration in Zambia delivers against 3 objectives:

1. to reduce poverty and strengthen resilience: through a strong focus on women and girls, and through strengthening health, education, nutrition, and social protection systems.

2. to Promote Green and Resilient Economic Development: by bringing green and responsible investment and helping Government improve the business enabling environment to create jobs

3. to support Governance and Democracy: working with civil society and government to strengthen democratic accountability and support decentralisation to improve service delivery

All UK investments focus on ensuring women and girls are empowered to realise their potential. Advancing the rights and opportunities for women and girls is a priority for the UK. In line with the International Development Gender Equality Act (2014), all our programmes in Zambia include a focus on gender, and we are also funding the development of an evidence base to improve understanding of pathways for women to exit extreme poverty.

We have a strong emphasis on evidence-based interventions. For example, with clear evidence that social cash transfers are highly effective in building the resilience of the poorest communities, the UK has supported Zambia’s flagship social protection programme for 2 decades – helping to build it from a pilot reaching a few thousand households to the 1 million households (or 5.4 million people) it reaches in early 2023.

Many of our investments help Zambia maximise its significant potential, whilst navigating future risks. For example, we work with Zambia’s energy sector providing independent expert advice on how to develop Zambia’s power sector in a changing climate to increase energy access. The UK Health Security Agency (HSA) also works closely with Zambian institutions to improve national pandemic and disease-outbreak preparedness.

The work of the British High Commission in Lusaka, with staff from multiple UK Government departments, is complemented by the UK’s broader international investments. Our support to multilateral funds such as the Global Fund, GAVI the Vaccine Alliance, and Global Partnership for Education (GPE) enable us to contribute to life-changing results at significant scale, in collaboration with the Government and other partners. The UK’s significant commitments to the World Bank (WB), African Development Bank (AfDB) and Green Climate Fund help to ensure financing at scale for Zambia’s National Development Plan. We add value to these multilateral investments through our diplomatic work, and by providing specialist advice.

Who we work with

The UK works closely with the Government of Zambia on development issues, including the Ministry of Finance, Ministry of Green Economy, Ministry of Education, and Ministry of Community Development and Social Services. Most of our support is in the form of specialist advice to develop and implement policies that will promote development and poverty reduction.

We partner closely with Non-Governmental Organisations (NGOs) working in Zambia, including Diakonia and Promoting Equality in African Schools. We also work with a Zambian not-for-profit company called ‘Prospero’ which supports small businesses to create jobs.

Our local support also goes through multilateral institutions such as UNICEF and WB, which allow us to jointly fund work with other development agencies. We coordinate our work with other international partners including the International Monetary Fund (IMF), United States Agency for International Development (USAID) and the European Union (EU) to ensure we support Zambia in a coordinated and strategic manner.

Choices on direct funding are informed by the ability of partners to achieve sustained positive change, with an emphasis on achieving excellence and value for money.

Key programmes

Three highest spending Foreign, Commonwealth & Development Office (FCDO) bilateral programmes in the financial year 2023 to 2024

1. Private Enterprise Programme Zambia Phase II (PEPZ2), April 2020 to January 2027

Spend to date: £12.7 million; Financial year 2023 to 2024: £2.05 million.

Aims: supporting Small and Medium sized Enterprises (SMEs) to scale up, attract investment and create jobs to pull people out of poverty. It aims to provide a pipeline of businesses for further investment.

2. Enabling Development for Girls Education (EDGE), September 2021 to August 2025

Spend to date: £3.1 million; Financial year 2023 to 2024: £1.6 million.

Aims: to expand access and improve education outcomes for 36,100 girls in Zambia by increasing the number of secondary schools as well as strengthening government education policy.

3. Zambia Social Protection Expansion Programme Phase II, September 2016 to December 2024

Spend to date: £24.2 million; Financial year 2023 to 2024: £4.4 million.

Aims: to strengthen Zambia’s social cash transfer system to identify and support the most vulnerable households and help them graduate from poverty.

FCDO also has several multi-country programmes working in Zambia. These include:

British International Investment (BII)

With an existing portfolio value in Zambia of £102 million, BII owns a large stake in Zambeef, and has signed an agreement with ZANACO Bank to provide $50 million of additional investment into SMEs in Zambia in the coming years.

AgDevCo

With a portfolio value approximately £12 million, AgDevCo holds debt and equity investments across the agricultural sector and aims to promote growth, jobs, and livelihood opportunities.

Cities and Infrastructure Growth

Forecast to spend £1 million in financial year 2023 to 2024, Cities and Infrastructure Growth provide specialist advice on energy sector reform to the Ministry of Energy and the public energy utility.

Several other UK Government Departments also support development work in Zambia, including:

• the UK Health Security Agency (HSA) supports the capability of the Zambia National Public Health Institute to implement International Health Regulations

• the Department for Environment, Food and Rural Affairs (DEFRA) invests in programmes to strengthen biodiversity, protect the environment, and tackle the illegal wildlife trade

• the Department for Energy Security and Net Zero supports the Government of Zambia to implement its Nationally Determined Contributions to tackle climate change and its impacts

The UK remains a significant contributor to key multilateral institutions supporting development in Zambia. These include WB and AfDB and funds including GAVI the Vaccine Alliance, Global Fund and GPE. The value of these investments significantly exceeds UK bilateral Official Development Assistance (ODA) expenditure.

Financial information

Initial allocations have been set internally to deliver the priorities set out in the International Development Strategy (May 2022) and the Integrated Review Refresh 2023, based on the FCDO’s Spending Review 2021 settlement.

The department’s spending plans for the period 2022 to 2023 to 2024 to 2025 have been revisited to ensure His Majesty’s Government continues to spend around 0.5% of Gross National Income (GNI) on ODA. This was in the context of the significant and unexpected costs incurred to support the people of Ukraine and Afghanistan escape oppression and conflict and find refuge in the UK, and others seeking asylum. The Government provided additional resources of £1 billion in 2022 to 2023 and £1.5 billion in 2023 to 2024 to help meet these unanticipated costs. The Government remains committed to returning ODA spending to 0.7% of GNI when the fiscal situation allows, in line with the approach confirmed by the House of Commons in July 2021.

The country development partnership summaries include the breakdown of programme budgets allocated to individual countries for 2023 to 2024 and 2024 to 2025. These allocations are indicative and subject to revision as, by its nature, the department’s work is dynamic. Programme allocations are continually reviewed to respond to changing global needs, including humanitarian crises, fluctuations in GNI and other ODA allocation decisions.

It should be noted that these figures do not reflect the full range of UK ODA spending in these individual countries as they do not include spend delivered via core contributions to multilateral organisations, or regional programmes delivered by the FCDO’s central departments. Other UK Government departments also spend a large amount of ODA overseas. Details of ODA spent by other UK government departments can be found in their annual report and accounts and the Statistics for International Development.

FCDO ODA allocation

The following pie chart illustrates expected FCDO programme spend by sector:

Figure 1. UK Bilateral ODA Expenditure in Zambia 2023-2024: British Investment Partnerships, 38%; Humanitarian, 35%; Women and Girls, 17%; Climate Change, Nature and Global Health, 11%

The following bar graph shows FCDO bilateral ODA spend in Zambia between 2019 and 2023:

Figure 2. UK Bilateral ODA Expenditure in Zambia from 2018 to 2023: 2018-2019, £27 million; 2019-2020, £38 million; 2020-2021, £34 million; 2021-2022, £14 million; 2022-2023, £17 million

Of ODA expenditure in Zambia in financial year 2022 to 2023, 72% is marked as being principally or significantly focused on promoting gender equality and 12% is marked as being principally or significantly focused on disability inclusion.

Allocated ODA budget financial year 2023 to 2024	Indicative ODA budget financial year 2024 to 2025
£10.845 million	£27 million