Analysis: OLIVER NZALA
ON A rough count, there is a minimum of 15 shopping malls in the City of Lusaka.
Infrastructure development for this type of business has rapidly increased and the trend is spreading across the country.
Perhaps one needs to look at the causes, effects, and benefits.
Shopping malls are not anything new to Zambia. What has changed from the 80s and 90s scenario is the size of these malls and the owners. Such a transition can be attributed to the power of globalisation, which has created seamless boundaries between countries, facilitating for easy movement of goods, services and people.
Consequently, besides the notable big malls dotted around the country, small and medium ones have sprung up. Price and quality competition has become the order of the day. Now, Zambia even has Chinese malls. A mixture of both genuine or original products and low quality goods is found in these malls.
It is undisputable that investors, through shopping malls, have done well in terms of providing jobs to Zambians and bringing in goods that Zambia cannot produce. That is what globalisation does. For every shopping mall built, jobs, goods and services are provided and, subsequently, there is an economic trickle-down effect on improving livelihoods. These companies also pay a good amount of taxes as revenue for Government.
What is of concern is that almost all malls across the country have foreign goods, be it food, clothing and machinery. Very little is from within Zambia. That speaks volumes of Zambia’s type of economy: consumption-based. A country that seeks to improve its balance of payments, like Zambia, should move away from this practice because it will continue importing more while exporting less.
The reason why foreign companies continue investing in malls is because they have seen that Zambians have a lot of money to spend on consumption than production. Monday to Friday, malls are full with Zambians doing all kinds of shopping and eating. Perhaps, they can’t be blamed; the minds have been tuned to thinking that nothing of good quality can be produced within Zambia. Whilst “local is lekker, foreign is best” – this is the current practice. There is no harm in having a lot of foreign goods but there is need to have a balance so that local businesses can survive. Today, even the small and medium entrepreneurs involved in auto-spares and hardware have been replaced by foreign investors through malls.
It is for such a reason that South Africa, through strategies in protecting its local industries, has banned certain products from other countries. Controversially, Rwanda has also done the same, banning second-hand clothes from the United States and other countries.
Recently, South Africa went on to ban pure honey from Zambia for health reasons, though Zambia is diplomatically handling this ban. Speculatively, the ban could be out of the desire to promote South Africa’s honey products. In a world of fair and equitable international trade, there is no need for Zambia to put the same measures against South African products, but it could put in place laws and rules that inherently protect local products using international trade laws. Shopping malls have practically become a dumping tool for export-oriented countries.
Whilst there is so much debate on quality and affordability, it should always be remembered that this kind of dumping should not be exploitative due to the inability of developing countries to produce. Sadly, a country has to be extremely careful when putting in trade laws that aim at curbing dumping before the World Trade Organisation (WTO) raises a red flag in the name of unfair trade. In Africa, only South Africa has managed to be heard by WTO on the issue of dumping.
Zambia has been promoting economic diversification since the early 90s with little progress made on this programme. Nothing is too late for any country to do as national development is more about sustainable development because it is about future generations. If it is not done now, who will do it? The main problem here is known. Between South Africa and Zambia, the difference is in the ability to produce more than the other.
Therefore, the solution to Zambia’s trade problems is well known. All that is needed is to incentivise key sectors such as agriculture, technology and engineering. These are sectors that lead to production. Having realised that malls are fully stocked with goods that Zambia cannot produce, mechanising these sectors in Zambia would spur accelerated production of goods and services.
There are countries such as Finland with small arable land but will produce more than Zambia due to mechanising of production methods. Let there be a deliberate policy to fully incentivise Zambia’s farmers in order to produce more for local consumption before any thoughts of exporting. This should be done while coming up with measures that put foreign products at a disadvantage.
Can Zambian farmers honestly fail to produce chickens and potatoes throughout the year? Well, there is a company that provides chicken and chips from outside Zambia throughout the year. Zambians involved in poultry farming have been reduced to trading in chickens on credit in their workplaces.
Zambia needs to accelerate its industrialisation process both from the public and private sector perspective. Demand for goods and services is hitting all-time high but the comparative advantage in land and labour is not being put to good use due to lack of advancement in technology. Again, that takes us to the issue of mechanising production.
The author is a master’s student of international relations and development at Mulungushi University.