INVESTMENT OPPORTUNITIES ACROSS THE AGRICULTURAL VALUE CHAIN
By Chabala Sunkutu, Associate
An Overview
Zambia’s agriculture sector stands at a crossroads of opportunity and transformation. Agriculture is central to the country’s vision for economic diversification, job creation, and rural development. In 2023, the sector contributed 2.8% to GDP but employed a staggering 70% of the population, highlighting its role as a livelihood backbone despite its underperformance in economic output.
The crop landscape is led by maize, the national staple, alongside cassava, millet, sorghum, soybeans, and various fruits and vegetables. However, heavy government subsidies historically skewed production towards maize, discouraging diversification. As maize yields decline and food imports rise, diversification and modernization are now essential. Meanwhile, livestock farming (especially cattle) and aquaculture—focused on tilapia—offer additional growth avenues.
Despite its promise, the sector remains largely non-mechanized and rain-fed. Only 156,000 hectares out of 2.75 million irrigable hectares are equipped for irrigation. Investment opportunities abound from large-scale farming and agro-processing to irrigation and tech-driven solutions for smallholder farmers.
Reforming Agricultural Productivity
With 42 million hectares of arable land and only 1.5 million actively farmed annually, the country’s potential remains vastly untapped. To address this, the government has gazetted land for farm blocks in all 10 provinces, each covering 100,000 hectares. These zones aim to attract private investment and stimulate rural development. Zambia’s comparative advantages—abundant water resources, a stable political climate, and favorable climatic conditions—make now a prime time for agri-sector investment.
Reforms and fiscal incentives have been introduced to boost productivity. These include zero tax on dividends from farming profits, 100% capital allowances for farm equipment, and tax breaks for inputs and exports. Complementary non-fiscal incentives include investment guarantees, land facilitation, and advisory support for both local and foreign investors.
From Subsistence To Sustainability
Key challenges still persist. Smallholder farmers face limited access to finance, infrastructure, and markets. Rural poverty and undernutrition remain high, with 46% of the population undernourished. Urbanization and demographic shifts are changing dietary preferences, requiring a more responsive and diversified food system.
To unlock agriculture’s full potential, Zambia must strengthen rural infrastructure, incentivize community-based financing, and scale up climate-smart practices. Improving access to finance, supporting land tenure reform, and encouraging public-private partnerships will be pivotal.
With strategic investments and policy coherence, Zambia’s agriculture sector can shift from subsistence to sustainability—creating jobs, securing food, and driving inclusive national growth.
