In last week’s elections, Zambian opposition leader, Hakainde Hichilema, took a landslide victory over President Edgar Lungu. With a historic turnout at the voting stations, the election may have set the country’s population up for a brighter future regarding Zambia’s political and economic outlook.
The outgoing president, Edgar Lungu, has long been accused of human rights violations. The newly elected president, Hakainde Hichilema, will need to prioritize recovery for the country. He will likely focus on gaining trust regarding human rights and the debt currently crippling Zambia.
Last week’s election was a monumental one for Zambia. After years of living under the weight of unemployment, corruption, a failing economy, and human rights abuse, Hichilema could be the answer the country needs to bring about balance. While we are not making overly rosy predictions just yet, let’s look at a few of the story’s details to see what Zambia’s political and economic outlook could be going forward.
Zambia’s Current Political and Economic Status
With the elections behind us, and president Hichilema entering the arena, we are ready to look at the current pollical and economic status of Zambia. Once we have a clear understanding of what the country is faced with, we will be better equipped to look forward and assess the outlook.
Zambia is considered a politically stable country, with democratic elections held every five years. This year’s elections were dominated by two parties: the ruling Patriotic Front (PF) led by president Lungu and the opposing United Party for National Development (UPND) led by Hichilema.
Since about 2000, the country has struggled economically, leading to discord within the population. The GDP stalled at around 3.1% in 2019, and in February of this year, the inflation rate was about 22.2%.
COVID-19 is to blame for Zambia’s most recent economic struggles and, indeed, the pandemic pushed the country into a recession. This is the first recession the country has experienced since 1998. Although the pandemic was the proverbial last straw, other factors were at play before the pandemic.
Some factors contributing to Zambia’s economic struggles include:
- Fluctuations in copper prices
- Impacts of climate change on rainfall and crops
- Insufficient rain for hydroelectric power stations
- Failing infrastructure
- Mounting national debt
- High inflation
- Unsustainable fiscal policies
- Mismanagement of public resources
- Soaring unemployment rates
With Zambia’s unemployment rate expected to reach 13% by the end of 2021, opposition leader, Hichilema, leveraged his campaign on promises of providing jobs for more of the population.
Zambia has a high rate of population growth. The population doubles about every twenty-five years. As children enter their child-bearing years, the growing population puts more strain on the economy, healthcare system, and unemployment.
Zambia’s Election
The atmosphere on Zambia’s 2021 election day was mainly calm. Of concern, however, were a few attacks on polling stations and the internet shutdown. It was claimed that the ruling PF instigated the shutdown to minimize coverage of the elections and stop people from sharing the election results.
This notion was further fuelled by the shrinking democratic space experienced during the lead-up to the elections. The Post independent newspaper was closed during this time, and Prime TV had its license revoked. Opposition candidates were physically attacked, and family members of the former president were placed in office.
On election day, 70.61% of registered voters cast their ballots. This turnout was arguably the highest in recent years. There was a surprisingly high turnout of young voters, the majority anti the ruling party.
Lungu claimed that the election had not been free and fair as the votes were being tallied. He claimed that the polling station attacks had affected voting. After a thorough investigation by the Electoral Commission of Zambia, it was found that the election was free and fair.
The election results were announced on 15 August 2021, with the opposition leader, Hakainde Hichilema, winning by nearly a million votes. After fears that Lungu would not concede defeat, he graciously accepted and promised to assist with a smooth transition to the new president.
Chants of: “We want jobs, young people want jobs.” were heard in the capital after the announcement of the election results, pointing to the frustration at the alleged human rights abuses, corruption, a failing economy, and massive unemployment rampant during Lungu’s 6-year term.
Zambia’s Political and Economic Outlook
Addressing the press in Lusaka on Monday, the newly elected president claimed that since he comes from humble beginnings, he wishes to give all the people of Zambia the opportunity to expand their horizons. Hichilema began as a cattle boy for his family and later became one of Zambia’s richest men. He attempted to become president five times before he was elected on this, his sixth attempt.
Politically, the country seems optimistic, and the population is looking towards a possibly brighter future. The youth, in particular, have faith that Hichilema will find solutions to the social, economic, and political issues that have been plaguing the country for as long as they can remember.
Even before being sworn in, Hichilema has announced the abolishment of political interference in the running and collecting revenue from public markets and bus stations. Local authorities will regain their control in these matters. Investor confidence is being boosted by the changes already being implemented, and general morale appears to be on the rise.
Since the country was the first in Africa to miss repayments to the World Bank Group’s Poor Countries Initiative, Hichilema will have to ensure that possible further waves of the Covid-19 pandemic do not prolong the $6bn debt owed.
The country is fertile and produces copper. Copper prices are at a decade high, resulting in some relief for the economy over the past few months. With rainfall stabilizing to somewhat typical patterns and the commission of a new hydroelectric plant, we have already seen improved hydroelectricity generation.
We should begin to see a better crop yield and relief from power cuts that saw the population without power for around seventeen hours per day. Rainfall variability remains a threat to Zambia’s economy, however. Plans will need to be implemented to minimize risk dependent on the climate.
Hichilema has inherited a country in need of swift economic recovery. Although dollar bonds jumped nearly 2c on Monday and Zambia’s Kwacha currency strengthened almost 1% against the dollar, Hichilema will need to reaffirm Zambia’s respect for human rights, secure talks for an IMF loan, and broker deals with creditors to assist the country out of the debt trap that is forcing the country to its knees.
The GDP is projected to grow at around 2.8% by 2023; however, Hichilema will need to implement policies to support the effects of COVID-19 going forward. He will need to work towards achieving macroeconomic stability while ensuring the availability of COVID-19 vaccines for the population.
Debt restructuring was put on hold until after the elections. While sentiments remain positive, Zambia’s democratic neighbors are watching to see if this third handover of power will go as smoothly as the previous two.
Conclusion
Since the Zambian elections on 12 August 2021, the political and economic outlook for the country seems to be positive. We have yet to see if the newly elected president will fulfill his campaign promises, but based on changes already set in motion, we believe at least some good will come from the election.
Since Zambian youth have launched their political involvement in the country, we may see more participation going forward, resulting in the new government being held accountable for their decisions and actions. Hichilema will need to focus on regaining the trust of his people and international leaders. He will need to implement strategies to rectify the country’s debt and factor in climate issues when considering power solutions for the country.
