Group flags major setbacks in Zambia’s Eighth National Development Plan

The Civil Society Organisation (CSO) Debt Alliance has raised concerns over significant setbacks in implementing Zambia’s Eighth National Development Plan (8NDP) in 2023, citing critical financial challenges.

The 2023 Annual Progress Report on the 8NDP revealed that only 46 percent of the targets for 2023 were met.

Out of 1,053 targets, 485 were achieved, 109 were partially met, and 459 were unmet.

The Economic Transformation and Job Creation Strategic Development Area experienced the highest financing gap at 76.9 percent.

CSO Debt Alliance Coordinator, Peter Mumba, noted that incomplete debt restructuring, illicit financial flows, and inadequate domestic resource mobilization had exacerbated the financing gap, hampering the nation’s progress toward its development objectives.

Read more: Civil Society Organisations unveil campaign to curb illicit financial flows in Zambia, Africa

“Despite planning to spend K107 billion on 8NDP programs, only K48.3 billion was allocated, resulting in a financing gap of K58.7 billion,” Mumba stated in a press release on Friday in Lusaka.

“Significant revenue leakages through illicit financial flows (IFFs), including tax evasion and trade mis-invoicing, have worsened the situation.”

Mumba highlighted that the Financial Intelligence Centre (FIC) reported K56.5 billion in suspected IFFs in the third quarter of 2023 alone, which could have closed 96 percent of the 2023 8NDP financing gap.

He also noted that tax audits conducted between 2014 and 2020 suggested Zambia could increase tax revenues without raising tax rates, addressing a total tax gap of 47 to 56 percent (United Nations).

“The incomplete debt restructuring process poses additional risks to Zambia’s debt sustainability, affecting credit ratings, access to capital markets, investor confidence, exchange rates, and fiscal policy flexibility,” Mumba added.

“Addressing these financial challenges is crucial for Zambia to achieve its 8NDP targets.”

To combat illicit financial flows, Mumba suggested that the government must develop a robust policy and legal framework enabling effective tracking and prosecution of illicit financial activities.

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