THE ADEQUACY OF ZAMBIA’S LEGAL AND POLICY FRAMEWORK ON INVESTMENT

Acontribution to the Committee on Economic Affairs and Labour
The National Assembly
Zambia

I. P. A. Manning
19 March 2007

INTRODUCTION
The Zambia Development Agency Act No. 11 of 2006 takes the place of the repealed Acts: Investment Act; Privatization Act; Small Enterprise Development Act; Export Processing Zones Act; and the Export Development Act, creating the quango: The Zambia Development Agency

THE ACT’S ADEQUACY:

i) The national investment objectives
These are articulated based on generally accepted international norms. However, it is clear that, in their making, they are not the result of true consultation with civil society conducted in a transparent and participatory manner as they do not address the cultural and socio-wellsprings of society, and therefore will remain an idealistic goal ever unattainable. In plain terms, the objectives are not the views of general society.
ii) Government responsibilities to foreign investors
These are poorly delineated, leaving the investor, should anything go wrong, at the mercy of the Arbitration Act, a process anyhow avoided by a Government Executive in which power remains highly centralized, where foreign investors are able to be deported under emergency powers introduced to deal with a state of emergency under a previous regime. There therefore needs to be introduced a special committee of the judiciary, set apart from the Executive, to deal with matters affecting investors who are targeted by corrupt elements.
iii) Government responsibility to local investors
Almost wholly absent, confusing investors as foreign investors, as shown in the section under incentives.
iv)Investors’ responsibilities to the workers
These are taken well care of under the Labour Act. However, market forces will require the issuing of suitable regulations from time to time. Flexibility is the watchword.
v)Investors’ responsibilities to the communities
These appear absent. Corporations should be required to adhere to a code of corporate responsibility. Beyond that, any legislation is problematic as the state should not dabble in such matters. In rural areas, the imposition of community development trusts as an umbrella to usher in development ‘greenfield’ partnerships will require appropriate legislation and regulations which result from proper consultations – currently a process much abused. The stakeholder workshop for the compilation of the 5th National Development Plan accepted the notion of ‘chiefs’ trusts: rather to be termed community development trusts so as to separate the powers of the chiefs from that of the community, but without damaging the traditional structures. What is required to be re-visited is the Natural Resources Act of 1962 which dealt with development in an holistic manner.
vi) The responsibility of the investors to the economy at large
These remain unclear and unstated


CONCLUSION
In general, Zambia has had an adequate legislative framework. However, it is in the area of the compilation and drafting of statutory instruments where there is considerable concern, regulations being drafted, checked by the Ministry of Justice and then peremptorily signed into law by Ministers without sight - or the participation of, civil society, thus creating the tyranny of the law. This process is not helped by the fact that Justice does not even have in stock the full list of SI’s, nor are they available at the Government Printer; and many bills remain unpublished. The law therefore remains a distant and intangible artefact to the common man, to the poor who are always with us. English Common Law and its equivalent, Customary law, remains the law of daily use. Zambian Statutory law remains therefore distant from those it is meant to serve. The expression of the law is therefore to provide the necessary framework for investors, both local and foreign, who may join together with the populace so as to attain – at the very least, the Millenium Development Goals (MDG). The MDG should be inculcated in the legal fabric. And the section on incentives: 56 and 65, require to be re-drafted so that a full menu of investor incentives is presented, the current two items being poorly thought out and not likely to attract the sort of investors required, as the current confusion of the Executive arm of Government confirms