ZAMBIA - Industry
Managing Director, Lusaka South Multi-Facility Economic Zone Limited (LS-MFEZ)
Dr. Fortune Kamusaki was born in Ndola in the Copperbelt Province of Zambia. He holds a Bachelor’s of Law Degree, as well as a PhD in Economics. He works for the Ministry of Finance as Chief Economist and, since January 2013, has been with the Lusaka South Multi-Facility Economic Zone Limited.
LS-MFEZ was declared in 2010 by the Government of the Republic of Zambia through the Ministry of Commerce, Trade, and Industry. The purpose of setting up the Zone is to promote manufacturing, especially export-oriented activities, technological development, skills transfer, jobs, and wealth creation. LS-MFEZ is intended to act as a catalyst for industrialization in Zambia, as the country is heavily reliant on its copper resources. Around 70-80% of Zambian exports are copper. When there are shocks in the price of copper on the world market, the economy suffers. The Government has, therefore, prioritized the development of multi-facility economic zones (MFEZs) as a way of diversifying the Zambian economy. At the moment there are a couple of MFEZs, with LS-MFEZ being the only one run by the Government. LS MFEZ Ltd started operations in January, 2013 and the response from investors and the public has been overwhelming. The zone is neighbored with the Lusaka Game Park and those interested in wildlife and natural fauna can also visit the local game park, which was opened in June 2015 by the President of the Republic of Zambia. LS-MFEZ is a mixed-use development comprising industrial, commercial, and residential developments, but the core business is the industrial part. The Zone expects about 400 companies set up base in the zone when it is fully developed, in different sectors such as agro-processing, electronics, gemstone processing, pharmaceuticals, and ICT. The LS-MFEZ has a total area of 2,100 hectares in a rectangular configuration measuring seven kilometers by three-kilometers. In terms of land use, 20% of the zone is for general industrial use. The rest is demarcated for commercial, residential, common facilities, and high-technology zones.
In terms of investor applications, so far there are over 130 expressions of interest, out of which 16 companies have been approved to start construction activities by the Board. Some of these companies have already started construction and should start commercial production by the end of 2015.
In terms of the infrastructure and utility services, about $40 million has been spent to date. However, over $400 million is required to fully develop infrastructure in the Zone.
The zone is open to both local and foreign investors, but so far we have had strong interest from Indian and Chinese companies.
LS-MFEZ is a special economic zone. There is a zero rated tax exemption on income tax and custom duty for five years for investors. This is a plus for people wishing to invest, because they will enjoy those tax incentives alongside the infrastructure and utility services being provided within the zone.
If you are investing in Zambia, you have a comparative advantage, because there are eight countries bordering the Zambia. The local and regional market is huge. The Zambian government has been improving infrastructure over the past few years to boost local and regional trade with countries like the DRC, Angola, and Mozambique.
The LS-MFEZ will be one of the key economic drivers of for Zambia’s economy in future. It will create 100,000 jobs for Zambians when fully developed, which will have a huge impact on job creation.
Zambia is one of the best countries in which to invest because the economy is liberalized and there are numerous tax incentives for those investing in multi-facility economic zones, industrial parks, and rural areas. The weather is good and the people are friendly, which makes for a great environment for doing business.
All sectors in the Zone have great potential for development. Such sectors include agro-processing, electronics, ICT, education, and skills training. The high-tech zone also offers great potential for the future. Don’t forget also the commercial sector with new shopping malls, conference centers, hotels, and similar developments, plus the residential sector. The residential sector will require about 30,000 housing units to be constructed within the zone. These are interesting sectors for investors.
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