Zambia’s Political and Economic Landscape

Zambia’s economic resilience masks growing political tensions, institutional risks, and persistent public dissatisfaction.

As a country that was once under the colonial rule of the British Empire, Zambia is one of the countries to have been subjected to the exploitative nature of British companies and British rule. After 76 years as a colony, Zambia gained independence from the British, as the United National Independence Party, under Kenneth Kaunda, came to power. Until 1991, when the country held its first democratic elections, Zambia had been marred by economic hardship and strict political rule post-independence. Although this had been the case, Zambia has since worked to translate political change into economic change, with better societal change being the end goal.

Political Stability and Governance

Despite extensive political reform, Zambian politics still look to be closely aligned with the ideologies and oppressive nature of a country with a one-party system. This was quite evident on the 13th of August 2026, when the country held its national elections, which were followed by extensive controversy. Zambia’s President Hakainde Hichilema was sworn in for a second five-year term following a disputed election and the arrest of his main opponent on treason charges (Muia & Zane, 2026). Such an exercise of power sheds light on the remnants of a desire to maintain the core form of authoritarian rule.

This has not been an isolated event, but rather, it is something that has become quite normalized under the governance of President Hichilema. Since 2023, there has been a spate of arrests of opposition party leaders and attempts by the new ruling party to control the outcomes of internal opposition party primaries and leadership races (Stiftung, 2026). Despite such controversy that followed the elections, investor confidence was fairly stable leading up to the elections.

Zambia’s economy remained stable as the country headed towards the August elections, with key sectors continuing to operate smoothly despite heightened political activity, according to Economist Kelvin Chisanga (Lebuse, 2026). Thus, the consistent transition of democratic government has created an environment where heightened political stability has a relatively positive impact on investment, despite political tension that arrives after elections.

Economic Growth and Public Confidence

Zambia may be a lower-middle-income nation, but the great reliance on its mining sector has optimized economic growth. The Zambian mining sector remains heavily dominated by copper, which continues to be the backbone of the country’s economy, contributing significantly to GDP, government revenue and export earnings (PwC, 2025). The high reliance on copper is justified, as the majority of export earnings are centered around the export of the natural resource, with earnings being at around 70% for the country.

Moreover, the domestic processing of raw materials in Zambia puts the country in an advantageous position, allowing Zambia to create valuable relationships for trade, essentially boosting economic growth.

Additionally, a shift in the economy and its growth can be seen in the country’s unemployment rate. The unemployment rate, as measured by the statistics agency, has registered a slight fall from 13% to 11% over the last four years (Buyoya, 2026). Such a drop has the potential to draw extensive foreign and local investment, further boosting the economy.

However, the growth on paper has failed to align with the needs of the public, essentially stunting their confidence in their own economy. Annual inflation has cooled to around 6.6%, its lowest in eight years, and the currency, the Kwacha, has strengthened, but for many households the relief remains theoretical (Buyoya, 2026). This comes as, although the cost of living by global standards may be low, low average incomes and rising prices have kept the average Zambian national from fully benefiting from the economy.

Political Risk Assessment

Although Zambia’s investment environment may benefit from the improvement in inflation and unemployment indicators, political and institutional risks that could potentially affect investor confidence should be considered.

Electoral disputes coupled with the poor treatment of opposition pose the highest risk to investor confidence. The possibility of political tensions, which may lead to insurrection by the opposition, may result in extensive political instability and a negative impact on investor confidence.

Public dissatisfaction has resulted in the reduction of confidence in political institutions. The low income level has left many feeling the government has not been doing enough when it comes to economic improvements reaching households. The cost of living has left many feeling abandoned in a country with such a stable economy.

Although the dependence on copper has been beneficial, it may also create external economic vulnerability and fragility. Government revenue and export earnings are greatly exposed to developments in the copper market, increasing political risk.

Bibliography

Buyoya, D. (2026) Zambia election: Lungu Burial Row turns presidential race into a hot contest, BBC News. (Accessed: 17 September 2026).

Lebuse, L. (2026) ‘Zambia’s election period reflects economic resilience’, Channel Africa. (Accessed: 10 September 2026).

Muia, W. and Zane, D. (2026) Zambia’s president Hakainde Hichilema sworn in for second term while opponent detained, BBC News.  (Accessed: 17 September 2026).

PwC (2025) Zambia 2025 mining report, Zambia 2025 Mining Industry Report. (Accessed: 17 September 2026).

Stiftung, B. (2026) BTI 2026 report country report: Zambia. (Accessed: 04 September 2026).