Repositioning Zambia’s Mining Tax Regime for the Energy Transition - Policy Brief, March 2023

Zambia is endowed with abundant natural resources, yet remains one of the world's poorest, with over 50% of its population living in poverty and 40% in extreme poverty. Youth unemployment is high, and the economy has experienced both good and bad economic times. The COVID-19 pandemic further strained Zambia's economy, leading to negative growth and debt, and a new Government adopted a contractionary fiscal policy to restore macroeconomic health. The government resorted to borrowing to fill budget deficits, leading to a significant slowdown in the economy and increased external debt servicing costs. In 2021, a new Government adopted a contractionary fiscal policy to restore macroeconomic health.Zambia is endowed with abundant natural resources, yet remains one of the world's poorest, with over 50% of its population living in poverty and 40% in extreme poverty. Youth unemployment is high, and the economy has experienced both good and bad economic times. The COVID-19 pandemic further strained Zambia's economy, leading to negative growth and debt, and a new Government adopted a contractionary fiscal policy to restore macroeconomic health. The government resorted to borrowing to fill budget deficits, leading to a significant slowdown in the economy and increased external debt servicing costs. In 2021, a new Government adopted a contractionary fiscal policy to restore macroeconomic health.