PRIVATE SECTOR DEVELOPMENT REFORM PROGRAMME (May 2009)

(This Document is the Property of the Government of the
Republic of Zambia)
PRIVATE SECTOR DEVELOPMENT REFORM PROGRAMME

(PSDRP)
PSDRP II
2009-2014
Programme Document
FINAL DRAFT
May 2009
Table of Contents
Abbreviations and Acronyms 3

Preamble 4
PSDRP II Summary 8
1.0 Introduction and Background 10
2.0 Situation Analysis 12
2.1 Existing challenges to business 12
3.0 PSDRP II Programme Focus 14
3.1 Priority reform areas 14

3.2 Guiding principles of PSDRP II 14
4.0 Programme Goal 15
5.0 Programme Purpose 15
6.0 Specific objectives, outputs and activities 15

6.1 Business licensing and regulatory reforms 15
6.2 SME development 16
6.3 Labour and skills development 18
6.4 PPP development 19
6.5 Trade expansion 19
7.0 Cross cutting PSD issues 20

7.1 Capacity building 20
7.2 Reform communication 21
7.3 Gender Mainstreaming 22
7.4 Ease of Doing Business Ranking 22
8.0 Zambia PSD Strategy 23
9.0 Program strategies 24
10.0 Institutional Structure 25
11.0 Implementation process 28
12.0 Monitoring and Evaluation 28
13.0 Sustainability 29
14.0 Risk and assumptions 29
15.0 Budget 29
Annexes
2
Abbreviations and acronyms
BDS Business Development Services
BRU Business Regulatory Unit
CEE Citizens Economic Empowerment
DSC Deputy Secretary to Cabinet
ERDC Economic Restructuring and Development Committee
FNDP Fifth National Development Plan
GRZ Government of the Republic of Zambia
ICT Information and Communication Technologies
JASZ Joint Assistance Strategy for Zambia
LA local Authority
LFA Logical Framework Analysis
LG Local Government
M&E Monitoring and Evaluation
MCTI Ministry of Commerce Trade and Industry
MDG Millennium Development Goals
MoFNP Ministry of Finance and National Planning
MOU Memorandum of Understanding
MRB Monthly Reform Backstopping (meeting)
MSME Micro Small and Medium Entrepreneurs
MSTVT Ministry of Science Technology and Vocational Training
PACRO Patents & Companies Registration Office
PMU Programme Management Unit
PPD Public Private Dialogue
PPP Public Private Partnership
PQPS Plant Quarantine & Phytosanitary Service
PS Permanent Secretary
PSD Private Sector Development
PSDRP Private Sector Development Reform Programme
RIA Regulatory Impact Assessment
RMM Risk Management Matrix
SAG Sector Advisory Group
SC Steering Committee
SI Statutory Instrument
SME Small and Medium Enterprises
TA Technical Assistance
TPIN Tax Payers Identification Number
WB World Bank
WC Working Committee
ZABS Zambian Bureau of Standards
ZBC Zambian Business Council
ZBS Zambian Business Survey
ZDA Zambia Development Agency
ZIBAC Zambian International Business Council
ZPA Zambia Procurement Agency
ZRA Zambia Revenue Authority
3
PREAMBLE
The Government of the republic of Zambia strongly believes that the private Sector
is the engine of growth. This belief was stated at the beginning of the liberalisation
of the economy and it still stands today. The establishment of a framework namely
the private sector development reform programme (PSDRP) is a testament of this
belief. The PSDRP is therefore an expression and a demonstration of the how
Government will set about the enhancement of a competitive business
environment.
The PSDRP II document outlines the framework of Governments private sector

development reforms in Zambia. As a Government programme and to enhance
ownership by all of Government, the process of consultations will continue for
over the next six months. It should be noted that although the document
encompasses the main elements of the reform framework, the PSD strategy that is
to be developed will set out the broader and long term Government direction and
contribute to a dynamic and flexible document. The Strategy will help the PSDRP
II document reflect the linkages with other PSD programmes, such as the Triangle
of Hope, Capacity Building for Private Sector Development, the World Bank Seed
Programme, Jobs and Prosperity Programme and other new initiatives such as
those that will be supported by USAID.
In recognition of the fact that reforms are a continuous process and require the full
engagement of Government machinery, further consultations on phase 2 of the
PSDRP will take place over a six months period i.e. from June through December
2009. The six months period will entail deepening of the document, utilising
information from key surveys such as the Zambia Business Survey, finalising
baselines and developing the Zambia PSD Strategy, setting up a monitoring and
evaluation framework, maintaining the reform momentum of PSDRP I and
firming up Governments long term resource commitments.
The first six months of PSDRP II will be referred to as the interim period of
PSDRP II and specific activities outlined in Table 1 below. These activities will be
the focus for six months. The activities that will be undertaken in six months
should thus be considered when reading this document. A detailed budget for the
six months has been provided as Annex 4 while the detail budgets for 2010 and
2011 will be undertaken during the six months interim phase and the details for
2012 -2014 will be done in 2011.
4
TABLE 1
PSD RP I I
ACT IO N P LA N JU NE -DE CEM BER 2 00 9
Ac tivit y Acti ons req uire d Time Deliv era ble Bu dge t (Z MK)
Fr ame
1. Deepening the • Consultative meetings with June – Buy in and GRZ 500,000,000
PSDRP Document various Ministries and August ownership of
regulatory Authorities on PSD PSDRP II
reforms at different levels. enhanced.
• Meetings to internalize and Ministries and

Regulatory
integrate the LFA and agree on
Authorities
monitoring and reporting
include some
arrangements.
PSD activities in
their 2010 annual
• Meetings to develop the plan and budget.
implementation plan and
develop annual targets.
• Meetings with the private

sector
• Meetings with various

Cooperating Partners.
2. Undertake • Identify required data and June PSDRP II 500,000,000
baseline studies existing baseline (such as baseline
business license inventory & developed.
Zambia Business Survey).
• Request for TA to develop TOR June

and baseline framework.
June
• Procure Consultancy(s) for the
baseline study.
July –Sept
• Undertake baseline(s)
October
• Disseminate and validate
findings
October
• Finalise final baseline study
document
3. Develop the M& • Recruitment of M& E Officer July PSDRP II M& E 300,000,000
E framework for system
PSDRP II • Identify TA to support July
development of the M&E
system Sept -
December.
• Development of M&E system
December
• Dissemination of M&E system
5
4. Develop • Identify TA to support August PSDRP MIS 200,000,000
Management development of the MIS system
Information system.
System (MIS) for October
PSDRP II • Development of M&E system
5. Implementation • Development of BLR June BLR 2,532,000,000

of Business implementation matrix implementation
Licensing Reform • Identify consultancy to draft June matrix
legal instruments for license
eliminations Legal instrument
• Drafting of legal instrument for June issued to
license elimination eliminate
July unnecessary
• Processes to submit legal
licenses
instruments for issuance
6. Consultative • Meetings with MoFNP to agree June- MTEF includes 200,000,000
meetings with on processes and activities to October PSD
MoFNP to include include PSD on MTEF Budget line for
PSD in the MTEF • Ministries to include PSD PSD created in
& other Ministries process in annual budgets GRZ budgets.
• Development of performance
based incentive system
7. Review • Planning and budgeting November - PSDRP II Annual 145,794,116
activities and meetings with Ministries and December Plan and budget
budget for 2010 regulatory authorities for 2010
8. Monitoring • Develop activity plan with DB June - Reform 60,000,000
Doing Business TA December momentum
Indicators • Finalise and sign MOU with sustained
Mauritius Board of Investments
• Formalise Zambia DB
committee
9. Public Private • Mapping of business July –Sept. Enhanced 789,000,000
Sector Dialogue association capacity needs Private Sector
(PPD) Capacity • Identify activities and training participation
building for both private sector and
public sector in PPD
10. Develop • Meetings with FIAS June - Reform 682,000,000
Reform Communications TA and August Communication
Communication stakeholders to develop the and
Plan and communication and implementation
Implementation implementation plan. plan
framework
11. Coordinating • Support formation of the June MSME Council 2,456,000, 000
and monitoring MSME Council formed
MSME data • Coordinate dissemination of June
the MSME (ZBS) findings
• Coordinate TA and support June August
setting up of the CGS
12. Labour • Developing the labour June – 504,000,000
Reforms productivity indicator August
6
• Development of skills September-
development strategy November
13. Development • Identify best practice in June PSD strategy 800,000,000

of the PSD developing PSD strategies developed
Strategy • Procure Consultancy July
• Strategy development August-

October
14. mainstreaming • Gender Mapping August Gender needs in 100,000,000
Gender PSD identified
15. Trade • Integration of EIF into PSDRP July - Dec 1,457,000,000
Expansion II
16. Programme June - Dec 1,646,205,884
Management
Contingency 200,000,000
Gr and Total 13 ,93 0,0 00
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PSDRP II SUMMARY
Programme Name: Private Sector Development Reform Programme (PSDRP II)
Goal: To promote and facilitate the development of a competitive business

Environment in Zambia in order to contribute to job and wealth creation’.
Purpose: To increase business access to markets and finance and reduce costs of
doing business in Zambia.
Key outcome: Competitive Business Environment
Key results: Administrative procedures/requirements and compliance costs reduced

by 30%
MSMEs operating in the formal sector increased by % 1
MSMEs accessing loans increased by%2
Number of employees on permanent employment in the private sector
increased by%3
At least 10 PPPs operational and providing improved infrastructure and
services
Ease of Doing Business ranking improved from 100 to 50
Programme Duration: June 2009 – June 2014
Budget: K180.0 billion
Financing: GRZ with supplementary support from Cooperating Partners
Priority Areas:
1. Business licensing and regulatory reform

2. SME Development
3. Labour and labour Productivity
4. PPP development
5. Trade expansion
Cross cutting Issues:
a. Capacity building for private sector reform in GRZ

b. Reform communication
c. Gender Mainstreaming
1
The % will be quantified in six months time after the baseline has been completed
2
3
8
d. Ease of Doing Business Ranking
Implementation: Ministries and Regulatory authorities
Management:
- Strategic: Deputy Secretary to the Cabinet – Finance & Economic development
- operational: PSD Unit, Ministry of Commerce Trade and Industry
Description: In order to address the business environment an implementation

framework in the Private Sector Development Reform Programme (PSDRP) was
established. The PSDRP II document has been developed as the follow up to the
PSDRP which closed at the end of March 2009. PSDRP II is set on the foundation
built by the PSDRP in the implementation of reforms in Zambia. A comprehensive
evaluation of the PSDRP was undertaken which identified some key lessons and
made recommendations which have been incorporated into the PSDRP II
document. The PSDRP II is a 5 year programme running from 2009 - 2014, which
targets to fast track and accelerates private sector reforms in a number of key
sectors which are expected to lead to an improved competitive business
environment.
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1.0 Introduction and Background
The Private Sector Development Reform Programme is an expression of the
Government of the Republic of Zambia’s commitment to reform the business
environment in Zambia. The Government believes that improvements in the
business environment through the reduction of the cost of doing business will
positively contribute to economic growth and to wealth creation.
The World Bank Doing Business Report, which studies 181 countries, has in their
2009 report ranked Zambia as 100 in the ease of doing business. This reflects that
compared to other countries the business environment in Zambia is not yet
favourable. Some of the indicators used to assess ease of doing business are
licensing, access to finance, business registration and time taken to import and
export goods. As a result businesses are not competitive and this tends to
discourage the growth of the private sector.
In order to address the business environment an implementation framework in

the Private Sector Development Reform Programme (PSDRP) was established.
The PSDRP II document has been developed as the follow up to the PSDRP which
closed at the end of March 2009. PSDRP II is set on the foundation built by the
PSDRP in the implementation of reforms in Zambia. A comprehensive evaluation
of the PSDRP was undertaken which identified some key lessons and made
recommendations which have been incorporated into the PSDRP II document.
The PSDRP II is a 5 year programme running from 2009 - 2014, which targets to
fast track and accelerates private sector reforms in a number of key sectors which
are expected to lead to an improved competitive business environment. The
PSDRP II is a Government programme that will be supported by cooperating
partners through supplementary financial resources and or technical assistance.
Since 1991 the Government of Zambia has focused on policies that encourage
increased private sector led economic growth. Economic reforms in the late 1990s
brought some tangible benefits, with a greater focus on fiscal discipline, better
governance and promoting private-led economic growth. Fundamental to this has
been the privatisation of state owned enterprises and the desire to attract foreign
and local investment in a variety of sustainable economic activities. However
despite economic growth in the past few years the performance of the private
sector has not yet met the desired expectations of poverty reduction.
Following years of modest economic growth, it became clear that Private Sector
Development (PSD) required additional support to help create sustainable jobs
and a more diverse local economy. This was based on the recognition that PSD
growth will only take place in the context of an enabling and competitive
investment climate.
10
In 2004 a framework was established for private sector development following a
review that showed that implementation of initiatives required a formal structure
within which to operate and coordinate the reforms. In order to address this,
Private Sector Development was formally identified as a priority of government
policy at the National Consultative Forum in 2004
By November 2005, a base document was drawn up that identified six fields of
reform that would form the basis of a Memorandum of Understanding between
the Government of the Republic of Zambia (GRZ), the private sector, represented
by the Zambia Business Forum (ZBF) and a group of donors. The MOU spelt out
the different roles and responsibilities of the three partners and acted as the
guiding document for the PSDRP.
Positive world market prices for copper and sound GRZ policies over the recent
past years have been able to provide Zambia with a good level of Macro economic
stability evidenced by limited budget deficits, positive economic growth, reduced
inflation, and high interest rates. However global dynamics continue to have
adverse effects on world copper prices. Like many African countries Zambia’s GDP
growth continues to be below the targets set by NEPAD.
Meanwhile government has further embraced the need for support to private
sector development as the engine for economic development expressed in its Fifth
National Development Plan (FNDP) for the period 2006-2010. The FNDP is
organized around the theme of “broad-based wealth and job creation through
citizenry participation and technological advancement”. In addition, the Vision
2030 of making Zambia a middle income economy and Zambia’s commitment to
achieving the Millennium Development Goals (MDGs) underpins the strong
commitment for creating a favourable business environment.
PSDRP II has made use of the findings, lessons learnt and recommendations of the
evaluation of PSDRP. The evaluation has provided valuable insights into the
direction of the next phase of the private sector reforms. In particular
recommendations have been made on the following aspects:
1. Institutional set up
2. Reform processes
3. Project processes
4. Priority areas
A summary of the main findings are provided in Annex 2. In addition to the

evaluation and other relevant reports, extensive consultations with key
stakeholders both from the public as well as the private sector have been
undertaken in developing PSDRP II.
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2.0 Situational Analysis
The current economic crisis is being transmitted to the developing world in at least
four channels, rapid decline in commodity prices, reduced investment, decline in
remittances and decline in Aid. Zambia has been affected by the effects of reduced
copper prices, job losses, reduction in the number of tourists coming to Zambia
and a scale back in investments. Sub Saharan African economic growth has been
cut from over 5% to around 3.5 % for 2009 (IMF World Economic Outlook
January 2009). Zambia’s GDP growth target (2009 budget) has been set at 5 %
with an inflation target of 10 %.
Although copper has had little impact on rural poverty it has however led to a
decline in urban poverty which means that with the reduced copper prices the
Government has to deal with the negative effects of both rural and urban poverty.
In such a scenario the temptation is to put certain programmes on hold or to
reduce support to programmes. However, since the policy agenda for private
sector reforms still remains high it is expected that Government will continue with
the PSDRP especially as Zambia continues to be a high cost of doing business
destination. In view of this improving the business environment is high on the
Zambia private sector development agenda.
In this regard, the current economic crisis has compounded the situation and has
led to the urgency to scale and further accelerate the private sector development
agenda. Notwithstanding the achievement made during the period 2006 – 2008,
the private sector still faces a number of challenges.
2.1 Existing Challenges to Business

The Zambian private sector faces a number of challenges some of which are
mentioned below:
2.1.1 Licences and regulations

Businesses operating in Zambia are required to adhere to numerous licenses
which also have a number of processes and procedures attached. As a consequence
the current licensing regime puts a heavy financial and non financial burden on
businesses. The weakness of the business licensing and regulatory framework has
been recognised in the first phase of PSDRP through the Business Licensing
Reform Report which has recommended reforms to reduce the number of licenses
and unnecessary processes and procedures.
2.1.2 High cost of inputs

The high costs of major inputs such as fuel and imported raw materials make
Zambia a relatively expensive place to do business. Regionally it puts Zambia at a
disadvantage as neighbouring countries are more competitive.
2.1.3 Inadequate Infrastructure

Although improvements have been made in infrastructure development Zambia
still is in dire of substantial amount of investment in infrastructure such
communication, energy, border facilities, rail, road etc.
2.1.4 Access and costs of finance

Although sound macro-economic management policies by GRZ have reduced
inflation and interest rates, access and cost of finance remains a key constraint to
12
further private sector development, especially for the Micro Small Medium
Enterprises (MSMEs).
2.1.5 Labour regulations

Current labour laws, with extreme high level of redundancy/severance payments,
make it difficult to provide employees with pensionable contracts. This results in
high levels of employee engagement on short term fixed contracts or casualisation.
2.1.6 Low productivity

There are many reasons for low labour productivity. The major ones highlighted
by the private sector are the inadequate skills demanded by industry and poor
attitudes to work.
2.1.7 Complicated trade arrangements

Current trade arrangements make it difficult to export and import goods. Zambia
has the potential to engage in substantial additional regional trade, however due to
trade barriers such as long and complicated border clearance processes,
businesses are not able to fully utilise business opportunities in the region.
2.1.8 Obtaining and transferring ownership of land and properties

Ownership and transfer of fixed properties follows a number of long and often not
very transparent procedures, which currently can only be undertaken through a
centralised system. This makes it difficult for the private sector to transact and
own immovable property, which compounds the access to finance as collateral is
hard to obtain.
The challenges mentioned above were recognised in 2004 when the PSDRP I was
being developed. The overall objective of PSDRP I (2006 - 2008) was to lay the
foundation for faster sustained private sector led growth by improving the
investment climate. The programme was developed around the following six
reform areas:
i. Policy environment and institutions

ii. Regulations & laws
iii. Infrastructure
iv. Business facilitation & economic diversification
v. Trade expansion
vi. Local empowerment
From the above six reform areas a number of reform priorities were identified
which were then implemented by 17 working groups, committees, and
sector/other bodies. An evaluation of the PSDRP was undertaken in December 08
– February 09 to assess the implementation of the programme. The evaluation
shows that although much work had been done, actual outcomes improving the
competitiveness for the Zambian private sector are not yet visible.
Nevertheless in a number of areas (business licensing, labour reforms, PPP) a

good foundation has been created for actual reform implementation which can
improve the competitiveness of Zambia.
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3.0PSDRP II PROGRAMME FOCUS
3.1 Priority Reform Areas

The PSDRP II programme needs to be dynamic and responsive to the needs of
both the local and foreign investors. An important lesson learnt from the first
phase of PSDRP was the need to focus on a limited number of priority areas to
ensure results in a relatively short period of time. The selection of priority areas
was based on the following considerations:
a) Ability to address challenges to business

b) Work done under phase I of the programme
c) PSDRP evaluation report
d) Ability to bring fast results at private sector operating level
e) Specific focus on SME development
Based on the above the following priority reform areas for PSDRP II have been
selected:
1. Business licensing and regulatory framework

2. SME development
3. Labour and productivity development
4. PPP development
5. Trade expansion
The reforms will be further prioritised in the Tourism, Agriculture and

Manufacturing sectors.
The following cross cutting areas have been identified as key support in the
implementation of PSDRP II:
• Capacity building
• Reform communication
• Gender mainstreaming
• Doing business ranking
To provide the overall Government long term perspective of and

commitment
to private sector development, PSDRP has prioritised the development of
the
PSD strategy within the first six months of the programme implementation.
The programme will provide tangible results on quick wins within 6-18 months
which will contribute to enhancing the competitiveness of the private sector,
through a reform process that delivers inputs to outputs that lead to
implementation and impact in priority areas.
3.2 Guiding Principles of PSDRP II

The following will be the guiding principles of the PSDRP II:
3.2.1 Result oriented:
14
The programme will focus on delivering specific and measurable outputs and
outcomes aligned to GRZ PSD objectives. In all instances, GRZ and private sector
will consider an output from the PSDRP II process as one that has a tangible
impact on improving the business environment for the private sector and
contributing to Zambia’s competitiveness.
3.2.2 Commitment
Government will demonstrate high level political commitment for PSD reforms.
This will be evidenced by formal prouncements, budget support and changes in
policies, laws and administrative processes and procedures.
3.2.3 Public-Private Dialogue (PPD)

PPD will be at the core of PSDRP II at various levels and will be seen as a tool to
engage the private sector in the reform process.
3.2.4 Co-ordination
PSDRP will have a clear separation between operational functions and strategic
management functions.
3.2.5 Harmonisation
In the spirit of harmonisation, PSDRP II will be recognised by Cooperating
Partners as the framework for supporting PSD programmes in Zambia. As was
recognised in the Memorandum of Understanding (MOU) of 2005 between
Government and PSD Cooperating Partners. The MOU distinguishes two
complementary funding modalities namely basket funding and bilateral funding.
In this regard all Cooperating Partners should recognise the PSDRP II as the
framework under which all PSD supported initiatives and programmes will be
coordinated.
4.0PROGRAMME GOAL
To promote and facilitate the development of a competitive business

environment in Zambia in order to contribute to job and wealth
creation’.
PSDRP II will contribute to the central theme of Zambia’s Fifth National

Development Plan (FNDP), which is broad-based wealth and job creation and
links in to Vision 2030 (“A prosperous Middle-income Nation by 2030”). The
program will also be contributing to the attainment of MDGs 1 (eradicating
poverty) and MDG 8 (development of global partnerships for development).
5.0PROGRAMME PURPOSE
The purpose of PSDRP II is to increase business access to markets and

finance and reduce costs of doing business in Zambia.
6.0SPECIFIC OBJECTIVES, OUTPUTS AND ACTIVITIES
6.1BUSINESS LICENSING AND REGULATORY REFORMS
15
The costly and cumbersome business licensing regime in Zambia has been
identified as a critical constraint to business and private sector development. Most
business licensing processes and procedures lack transparency are time
consuming and in many cases unnecessary.
The web of laws, regulations and administrative procedures serves to increase the
cost of doing business and impedes private sector development. Many laws and
regulations are obsolete and licensing practices have, in the main, not kept pace
with modern technologies. More intractable problems result from the volumes of
inter-related and overlapping legislation, leading to duplication in the licensing
system, and the compartmentalisation of administration/licensing authorities and
departments.
Government successfully completed the first phase and is now in the process of
agreeing on implementing the recommendations of the business licensing reforms
Report which will culminate into phase II.
6.1.1 Objective
To reduce unnecessary business licensing procedures and
requirements to reduce the costs of doing business
6.1.2 Outputs
1. Reduction in the number of licenses
2. Reduction and streamlining of licensing requirements
3. Establishment of E-registry
4. Establishment of a Business Regulatory Unit (BRU)
5. Establishment of E-governance systems, providing electronic licensing service
delivery and net working/co-ordination/information sharing among regulatory
authorities
6. Business registration systems decentralised
6.1.3 Activities
1. Advocacy for Cabinet approval of the Business Licensing Reform Report
2. Issuance of legal instrument to revoke illegal licenses
3. Organize sensitization seminars for stakeholders
4. Organise ministerial meetings to agree on the implementation
5. Amendment of various legislation regarding business licenses
6. Establish a tracking system for business licensing reforms
7. Acquire hardware and design software
8. Identify host for the E-registry
9. Setting up the BRU
10. Set up the e-platform/system for targeted regulatory authorities
11. Undertake an inventory of business licenses
6.2 MSME DEVELOPMENT

The desire for the Micro, Small and Medium Enterprises (MSMEs) sector to grow
is premised on the understanding that development of section of the economy
would lead to poverty reduction and improved quality of life of households
through wealth and job creation.
16
Even though this premise has been widely accepted, MSMEs in Zambia face a lot
of constraints in running their businesses. The most common constrains sighted
include inaccessibility to finance and markets; high cost of borrowing from the
commercial banks; shortage and high cost of inputs; poor infrastructure; lack of
appropriate tools and machinery; lack of skilled labour; shortage of affordable and
decent premises; unavailable utility services; low technical and entrepreneurial
skills and a harsh business environment.
The Government, through various institutions, has tried to support the MSME
sector through a number of initiatives. Notable ones being the creation of the
Citizens Economic Empowerment Commission (CEEC); the introduction of the
Business Development Services (BDS) Voucher Scheme which provides access to
subsidised business advisory services for MSMEs; the introduction of the business
linkages programme and the tailor made MSME training in access to markets and
finance.
Much more effort still needs to be made in this sector to assist the MSMEs to
graduate into large enterprises. PSDRP II will have the development of the MSME
sector has one of its priorities as already mentioned above. It will mostly
concentrate on synergizing development efforts in this sector. The lack of synergy
has been seen as one of the biggest problems in the efforts being made to enhance
the sector. Many stakeholders are involved in one way or the other in trying to
assist but the net effect is minimized due to information asymmetry and lack of
coordination.
PSDRP II will therefore work with all the various sectors in an effort to maximize
the benefits in a holistic manner. The synergies will be through coordination, both
at the level of dialogue and at monitoring and evaluation levels.
The MSME sector is huge when measured in the number of entrepreneurs with
over 3.8 million Zambians operating their own business. The sector has an
important role to play in reducing poverty in the country however it largely
operates informally and is faced with impediments in areas of access to finance,
infrastructure, access to Business Development Services, access to land, etc.
6.2.1 Objective
To stimulate the growth of the MSME sector in Zambia
6.2.2 Outputs
1. Develop indicators for the MSME policy
2. MSME policy approved and implemented
3. Credit guarantee scheme for MSME established and operational
4. MSME incubators programme established and operational
5. SME access to finance and market training programme rolled out by ZDA
6. Develop synergies among various stakeholders in the SME sector
7. MSME council established
6.2.3 Activities
1. Develop a comprehensive MSME implementation framework
2. Develop system for the MSME credit guarantee scheme
17
3. Implement recommendations of the National Business Incubator consultancy
report
4. Development of tracking system for CEE and BDS
5. Develop tracking system for the MSME access to markets and finance
programme
6. Develop case studied of successful MSMEs
7. Undertake MSME training tracer studies
8. Dissemination of the ZBS report findings
6.3 LABOUR AND PRODUCTIVITY DEVELOPMENT

Labour law reforms started in 2006 with the creation of the Labour Law Reform
Working Group (LLRWG). The 2004 PDSRP action plan had a number of priority
areas one of which was Law and regulations which focused on the review of
legislation that have direct impact on business. The labour laws were identified as
being a significant impediment to the growth of the private sector in Zambia
because of some of the provisions in the laws increase the cost of doing business
like the cost of hiring and firing.
The high cost of severance package is one of the impediments that prevent
business from employing more people on a permanent basis. Besides labour
productivity is hampered by the gap between practical vocational skills demanded
by the private sector and those produce by the education system.
There are currently only three (3) public universities and relatively a large number
of technical and vocational training colleges offering skills training. In addition,
there are number of private universities, such as Cavendish University, Zambia
Open University, Australia Institute of Business and Technology, and Northrise
University. There are still opportunities for investment in the education sector
especially in university and tertiary education by the private sector.
6.3.1 Objective
To enhance private sector capacity to create employment and improve
labour productivity
6.3.2 Outputs
1. Reforms pertaining to business related labour laws completed and
implemented.
2. Labour reforms pertaining to retirement and redundancy/severance packages
completed and implemented
3. Systems for measuring and developing labour productivity in Ministry of
Labour or Productivity Centre established
4. Skills development strategy developed
6.3.3 Activities
1. Organise sensitization seminars for stakeholders on business related labour
laws
2. Hold consultations with stakeholders to agree on reform to be undertaken
3. Develop system for measuring labour productivity
4. Organise change management workshops
5. Undertake Skills needs assessment survey
18
6. Business related labour laws review
7. Develop systems for measuring labour productivity
8. Develop job creation indicators
9. Undertake labour force survey
10. Identify best practices in skills development
11. Engage consultant to develop skills development strategy
12. Finalise skills development strategy
6.4 PPP DEVELOPMENT

The Government has identified PPPs as a viable means of infrastructure
development that can effectively address the constraints of finance and
management that it faces. The intention of Government is to engage the private
sector in the development of infrastructure and services through Public-Private-
Partnerships. In this regard the government launched the PPP policy.
Through the PSDRP II, Government will continue with its facilitative role of
encouraging and enhancing private investment in the sector. This will be done
through the PPP Unit under the Ministry of Finance and National Planning. The
issues to be pursued in this regard will be to see the enactment of the PPP Bill and
the continued capacity building of both the private and public sector in PPPs.
6.4.1 Objective
To enhance private sector investment in infrastructure development
6.4.2 Outputs
1. PPP bill enacted
2. PPP unit operational
3. Capacity of public and private sectors for PPP arrangements developed
6.4.3 Activities
1. Dissemination of PPP policy and Act
2. Training and sensitisation workshops for public and private sector in PPP
arrangements
3. Development of PPP systems (Manuals for Operating systems, Contract
models, Monitoring system) developed
6.5 TRADE EXPANSION

Trade expansion is about putting in place measures that are intended to create a
more favourable environment for trade to take place. It is through cheaper and
faster and easier transporting of goods across borders that that businesses can
respond more positively and access both regional and international markets. The
expansion thus entails issues surrounding regulation and licensing and making
sure processes and procedures are transparent and streamlines. According to a
study on transport costs and prices in Africa a 20% reduction in cross border
crossing has a positive increase of 18% on sales and between 10-15% decreases in
transport prices in southern Africa.
To improve the coordination and maximise benefits from all trade-related

technical assistance programmes being coordinated by the Ministry of Commerce,
Trade and Industry, the programmes are coordinated using the Integrated
Framework (IF). To ensure the IF is coordinated with Government’s other
19
activities related to private sector development, in line with the MoU, the IF is
regarded as the trade expansion component of the PSDRP II, integrating the IF
management mechanisms into de PSDRPII. The IF-Programme for Zambia will
constitute the implementation plan for the Trade facilitation.
Trade expansion reforms will focus on creating practical improvements, making

trade easier for the private sector.
6.5.1 Objective
To address barriers to trade expansion and enhance the capability of
Zambia to efficiently and effectively take advantage of trade
opportunities abound in the regional and other international markets.
6.5.2 Outputs
1. Increased coherence in the policy, regulatory and legal framework for trade
expansion in Zambia
2. Improved trade facilitation and border infrastructure & procedures
3. Enhanced productive capacities in prioritised sectors
4. Increased legitimacy of the standards, quality assurance, accreditation and
metrology (SQAM) national system and product acceptability in the local,
regional and international markets.
5. Enhanced capacity to trade policy analysis, formulation, negotiation, and
discourse among PSDRP Stakeholders and in the Ministry of Commerce, Trade
and Industry.
6. Increased regional and international market access and penetration of
Zambian products
7. Enhanced effectiveness in supervision, programming and implementation of
EIF and synergies and scale effects resulting from the better coordination
MCTI coordination and other trade-related technical assistance initiatives
6.5.3 Activities
1. Conducting a comprehensive SQAM Assessment Study (Legislation,
institutions, infrastructure – including laboratories and personnel)
2. Implementation of the SQAM Assessment Study recommendations
3. Provision of support for value chain mapping, sector strategy development and
implementation.
4. Conduct and implement the findings of an Assessment and Capacity Needs
Study of Government Printers
5. Setting up of a Trade Infrastructure Development and ICT facilities Fund
within PSDRP
6. Training, workshops, seminars and meetings
7. Provision of support for gathering and disseminating market intelligence
8. Provision of support for undertaking trade promotion and market development
activities
7.0 CROSSCUTTING ISSUES
7.1 Capacity Building for private sector reform in PSD

Capacity building within government structures to develop buy-in and ownership
for private sector reforms, will form a vital aspect of PSDRP II. Government
Ministries by their nature are not inclined to include private sector reforms in
their daily activities. To ensure that there is buy-in, commitment and
20
understanding specific interventions need to be made to ensure that private
reforms are mainstreamed and institutionalised.
It was observed in the PSDRP I that the Private Sector was weak and fragmented.
In PSDRP II will therefore support capacity building for the private sector to
effectively engage government in PSD issues. The capacity building will
complement the efforts of the Capacity Building for private sector development
programme which focuses on the MCTI and its Statutory Bodies. PSDRP II will go
further than the MCTI and include other Economic Ministries and Regulatory
authorities to make them more responsive to the business environment issues. In
particular Capacity building in key institutions that have a private sector mandate
such as the Zambia Development Agency will receive particular focus and support.
7.1.1 Objective
To develop and strengthen the capacity of government’s
responsiveness to PSD interventions
7.1.2 Outputs
1. Ministries and regulatory authorities annual work plans and budget include
private sector reform activities.
2. Best practices identified and internalised within ministries and regulatory
authorities
3. Customer charters developed
4. Effective mechanism to respond to private sector needs established
5. Capacity to undertake Regulatory Impact Assessments (RIA) created within
Ministries and regulatory authorities.
6. Private sector engagement strengthened
7. Customer charters developed
8. Incentives for reform champions established
9. Implementation of PSD reforms enhanced
7.1.3 Activities
1. Training in analysis of reform issues, reform planning, Regulatory Impact
Assessment (RIA) and budgeting
2. Workshops and sensitisation in change management
3. Criteria developed for incentives, rewards and awards for reform champions
4. Training the private sector in advocacy skills, lobbying and RIA
5. Study Tours to learn best practices
7.2 Reform Communication

Reform communication is an effective tool that can be used to create awareness
and support for private sector reforms. It is also an opportunity for the
stakeholders to appreciate and participate in the reforms.
Although a communication strategy was developed in PSDRP I, its design was

flawed and as a consequence its implementation was partial. In PSDRP II,
emphasis will be placed on communication to build momentum for reforms and
full implementation of the communication plan.
7.2.1 Objective
21
To create broad awareness and support for Private Sector
Development Reforms
7.2.2 Outputs
1. Reform Communication plan developed
2. Broad awareness and support for PSD reforms created and enhanced
7.2.3 Activities
1. Develop an implementation plan
2. Brand PSD reforms will be branded to ensure wider recognition
3. Create synergies between and across reforms
4. Identify and communicate reform success stories
5. Communicate reform results
6. Communicating the link between “Doing business” publications and PSDRP
7. Communicating impact in selected industries
8. Regular review of communication tools
7.3 Gender mainstreaming

Gender plays an important role in socio-economic development. Gender affects
all sectors including the private sector. Studies have shown that the level of
education attained by men and women determines their level of participation in
the formal employment sector.
The participation of all Zambians on an equal footing, in the economic activities of

the country is cardinal for increased economic growth and reducing the poverty
levels. It is, therefore, imperative that gender considerations in the growth of the
economy be recognised and embraced by all.
The majority of women in Zambia are limited to managing micro and small
businesses mainly due to their limited access and control over resources. In order,
to ensure equity in doing business in Zambia policies and laws should be tailored
and in some cases targeted to women. In situations were women have been
assisted the impact of the various interventions such as increased access to finance
need to be assessed so as to ensure there is growth of female owned enterprises.
7.3.1 Objective
To enhance and facilitate the inclusion of a gender dimension in
private sector reforms.
7.3.2 Output
Gender mainstreamed in private sector reforms
7.3.3 Activities
1. Gender mapping
2. Surveys on current situation and needs
3. Surveys to assess impact of PSD interventions
22
7.4Ease of Doing business Ranking
Doing business reports are annual reports published by the World Bank. The
Doing Business Report investigates regulations that enhance business activity and
those that constrain it. The following indicators are measured:
1. Starting a business,
2. Dealing with construction permits,
3. Employing workers,
4. Registering property,
5. Getting credit,
6. Protecting investors,
7. Paying taxes,
8. Trading across borders,
9. Enforcing contracts and
10. Closing a business.
The indicators are used to analyse economic outcomes and identify what reforms
have worked, where and why. Economies are ranked on their ease of doing
business, from 1 – 181, with first place being the best. A high ranking on the ease of
doing business index means the business environment is conducive to the
operation of business.
According to the Doing Business (DB) 2009 Report Zambia’s ease of doing
business ranking improved from 116 to 100 out of a total of 181 countries. This is
an improvement of 16 places. In the next five years the target is to move in the top
50 counties in the world, among the top three in Africa and recognition as a top
reformer.
Although the Doing Business rankings are not the only bench mark that the
PSDRP II will use, the rankings will be used to help the PSDRP focus on deepening
reforms whose results will be monitored annually. Some of the key activities that
will be undertaken towards improving Zambia’s ranking are itemised below
7.4.1 Activities
1. Sensitisation of various stakeholders on the DB indicators
2. Capacity building for implementing ministries and regulatory authorities
3. Formalisation of the Doing Business Committee
Technical assistance for the ease of doing business will be sought from the World
Bank Doing Business Project Team.
8.0ZAMBIA PSD STRATEGY

In recognition that Zambia does not have a PSD strategy PSDRP II has prioritised
the development of the strategy within the first six months of its implementation.
The strategy is expected to provide the following benefits:
1. Outline the broader agenda of PSD

2. Provide institutional/budgetary support to PSD
3. Institutionalise private sector reform within government
4. Provide a framework to include all PSD initiatives
23
The Zambia PSD Strategy will provide an opportunity to expand the
programme and reflect the inclusion of all PSD Activities supported by
cooperating partners whether through the basket funding or other separate
programmes.
8.1Objective
To develop a comprehensive and systemic government owned PSD
agenda
8.2 Output
Zambia PSD Strategy developed
8.3 Activities
1. Consultations with stakeholders
2. Identify best practices
3. Identify appropriate technical assistance
4. Finalise PSD strategy development
The development of the PSD strategy should take cognise of the need to reduce disjointed
PSD initiatives.
9.0 PROGRAMME STRATEGIES

To ensure effective programme implementation the following strategies will be
used:
9.1Public Private Dialogue

Public Private Dialogue (PPD) is an effective and transparent mechanism for
public and private sector engagement on private sector development issues. It
promotes inclusiveness, trust, confidence and accountability. PPD will be at the
centre of the reform processes. Within PSDRP II, PPD will take place at all levels
of policy and legislation processes such:
1. Zambia International Business Council (ZIBAC)

2. Zambian Business Council (ZBC)
3. Sector Advisory Group (SAG)
9.2Few Priority Areas

Unlike PSDRP I, PSDRP II will concentrate on fewer priority areas that will allow
for deepening and ensuring results in the shortest period of time.
9.3Effective monitoring
An effective M&E system is key to the tracking of progress and reform results.
Therefore an M&E will be part the design of PSDRP II.
9.4Benchmarking
PSDRP II will use benchmarking as a tool for assessing Zambia’s performance
against better performing countries in private sector reforms. In PSDRP I
Mauritius was selected as a country benchmark for Zambia against on the ease of
doing business and other private sector reforms.
24
PSDRP II will work towards achieving the private sector development
indicators/milestones in the Performance Assessment Framework (PAF) 2008 -
2010.
9.5Performance Incentives
The PSDRP will recognise and publicise Ministeries and Regulatory Authorities
that perform and deliver results. A performance system will be developed to link
results to resources released.
9.6Donor Government PSD Dialogue

To improve communication about the implementation of the PSDRP II, informal
monthly meeting between the PSD unit and the donors and formal Semi Annual
review meetings between PSD donors and High level Government representation
will be held.
10.0Institutional Structure
Some of the key finding in the PSDRP evaluation highlighted the bottlenecks which
hindered the effective implementation of the private sector reforms. The notable ones
being the infrequency of Zambia Business Council meetings, inadequate representation
of private sector by ZBF, the shift in focus of Steering Committee from strategic issues to
management matters and limitations experienced by PMU.
The PSD unit will continue being housed in MCTI under the Directorate of Planning and
Information. The PSD unit will continue to have a dual reporting structure, for the
purposes of administrative reporting it will report to the PS MCTI. For strategic issues
the unit will report to the Steering Committee through the DSC-FED. It is important to
note that added responsibilities of the PSD unit are directly link to creating an efficient
project reform process. This project reform process should be distinguished from the
reform process which is managed and implemented by the line ministries. In other words
the PSD unit’s mandate is to facilitate, coordinate and monitor the reform process. To
strengthen theses functions it is envisioned that some of the current positions such as
Administrator and Accountant will be merged into one position of Finance and
Administration Officer and that new positions for Procurement Officer and Monitoring
and Evaluation Officer will be created. The key activities that will be implemented in the
first six months of the programme are shown in table 1.
In view of the above, the institutional structure for PSDRP II is shown in Figure 1 and
Table 2. Figure 1 shows the delineation between strategic and operational issues while
table 2 shows the roles and functions of the different bodies.
25
Figure 1: Institutional Structure
Strategic issues
Zambi a Business C ouncil ( ZBC)

• Chair H E the President
• 12 Economic Cabinet Ministers
• 10 Private Sector representatives
Zambi a Int ernation al Busin ess Econom ic Restructuring

Ad visory C ouncil Co mmit tee ( GRZ)
•
• Chair H E the President
•
H E the President
12 economic Cabinet
• 10 international advisors Ministers
• 12 economic Cabinet Progress report PSD reform
ministers permanent agenda item
• Private sector
Sector Ad visory Gr oup

(SA G)
Monthl y R ef orm Backstop ping Steeri ng C ommit tee • PS MCTI chairs
(MRB) me eting • DSC (Chair)
• DSC • Economic advisor to H E the President • 3 donors, Ministries,
• 3 key PSs • PSs (MCTI, MoFNP, Justice, Labour & Home Affairs private sector & civil
• 3-4 Key businessmen • 3 Private sector (Sectoral Associations) society
Monthly meeting • 2 Private sector champions (key business(wo)men)
• 3 Donors will attend as observers
Meets quarterly
Operational issues
PS - MCTI Lin e Mi nistry: Lin e Mi nistry: Lin e Mi nistry:

• PS reports Reform implementation Reform implementation Reform implementation
to SC and • PS reports to SC and • PS reports to SC and • PS reports to SC and DSC
DSC DSC DSC
PSD Unit
• PSDRP Co-ordinator
• Project Officers x4
(responsible for
reform specific
portfolio/WCs)
• Communication
Officer
• Support functions
(accounts, etc.)
Worki ng C ommit tee : Worki ng C ommit tee : Worki ng C ommit tee :
Key f unctions • Chair Director • Chair Director • Chair Director
• Co-ordination & • Director reports to PS • Director reports to PS • Director reports to PS
facilitation reform
process
• Reform performance
management
system-dashboards
Reporting to Director
Planning
26
Table 2 PSDRP II Institutional structure: functions and roles
Body /Inst itution Co mposi tion Key func tions Frequenc ies
• • To provide advice to the President
Zambia International Business
Advisory Council (ZIBAC)
H E the President (chair)
• Once a year
• Economic Cabinet Ministers • To advice the President on international best
• 10 International Advisors practices
• Private sector representatives
• Secretariat/ PSD Unit
Zambia Business Council (ZBC) • H E the President (chair) • To raise key issues concerning the business • Semi annual
• Economic Cabinet Ministers environment
• Review the country’s economic performance
• Private Sector representatives
• Monitor PSDRP progress
GRZ Economic Restructuring and • H E the President (Chair) • PSD issues to be a permanent agenda item • Regular meetings
Development Committee (ERDC) • 12 Economic Cabinet Ministers
PS MCTI • PS MCTI • Administrative responsibility for the PSD Unit • N/A
Permanent Secretaries’ Quarterly • Secretary to Cabinet (Chair) • PSD issues to be a permanent agenda item • Meets quarterly
meetings • DSCs
• All PSs
Steering Committee (SC)
• DSC (Chair) • Strategic support to PSDRP II • Meets quarterly
• Economic Advisor to H E the President • Approval of annual plan & budget for PSDRP II
• PSs (MCTI, MoFNP, MoJ, MLSS and MLGH) • Monitoring reform outcomes
• 3 Private Sector associations representatives • Monitoring PSD Unit
• 2 Private sector champions • Facilitation of Ministries buy-in to the PSD
• 3 donors (observers)
Process
Convene ZBC meetings
• PS MCTI chairs • Meets quarterly
Sector Advisory Group (SAG)
• Feedback on results (check ToRs)
• 3 donors
• Private Sector
• Ministries
• Civil Society
• Academia
• Secretariat/ MCTI – P&I
Monthly Reform Backstopping (MRB) • DSC • Backstopping support to reform processes • Monthly meetings
Meeting • 3 PSs (part of weekly DSC-
• 3-4 Key businesspersons PSD meetings)
• • Regular
Line Ministries PS
• Reform implementation and monitoring
• Line ministry staff
PSD Unit
• PSD co-ordinator • Facilitate and coordinate PSDRP II • Regular
• Programme Officers x4 • Development of PSDRP II performance

• Communication Officer management system/monitoring dash boards
for Reform and Project processes
• Procurement Officer • Provision of monitoring dashboards to MRB
And SC
• M & E Officer
• Finance & Admin Officer
• Support functions – Executive Assistant,
Accounts Assistant, Office Assistant &
Driver
• Monthly
Working Committee
• Ministry representatives (Director level-chair) • Plan and support the actual reforms
• Private sector representatives • Develop action plan, targets and timelines
• Line ministry
• PSD Unit programme officer (part of Secretariat)
27
11.0IMPLEMENTATION PROCESS
In implementing reforms the following two distinct processes will be used:
1. The PSD reform process

2. The PSD project process
11.1Reform Process
Implementation of reforms will be carried out within the relevant line ministries and
developed in the working by GRZ staff and the private sector. Reforms take place at three
levels namely:
1. Laws
2. Policies
3. System
Among the above three, reforms of systems is the fastest to implement and provide
tangible results. In recognition of this PRDSP II will stronger emphasis on reforms that
focus on system change and faster and tangible results.
11.2Project Process
The project Process is the delivery mechanism of the reforms. This project process will
require the coordination of the stakeholders listed in table 2. In order to ensure
effectiveness and efficiency in the project process there should be adherence to
responsibilities and timeframes by the various parties.
Ministries and Regulatory Authorities will develop annual work plans and budgets for
approval by the Steering Committee. They will then be expected to provide annual
reports. The Ministries and Regulatory Authorities that will be implementing the
reforms under the priority areas and cross cutting areas are listed in Annex 6. The plans
and the reports will be consolidated by the PSD Unit. All the funds released will be
subjected to annual programme Audits, included sub-granted funds.
In this regard the PSD unit will source for appropriate TA to further to elaborate the
reform and project processes and develop the appropriate tools.
11.3 Programme Funding

The Government will provide resources for the programme directly or through the
implementing Ministries. The Government support will be supplemented by Cooperating
Partners with financial and technical support. In order to enhance and effectively
monitor the private sector development, PSDRP II funding mechanism will be flexible
28
and incorporate more than one mechanism. Although the basket funding will be the
desired and preferred option, alternative support such as Bilateral and Technical support
that is targeted to the priorities of PSDRP II will also be possible. The Funds for private
sector reforms are thus expected to evolve from basket funding to budget support.
12.0Monitoring and Evaluation

The logical framework will form the key tool for the monitoring and evaluation of PSDRP
II. It will also be used as interactive tool to enable the achievement of results. Since the
LFA will be critical element of the monitoring, its regular review will be an ongoing
process. The LFA will also be validated through the baseline study. The PSDRP II will
establish a baseline for the whole programme. The baseline data will be generated within
the first six months of the programme and will assist in the further developing and
refining the indicators.
To demonstrate the programme effectiveness, two industries in the Tourism and

Agricultural sectors will be selected and a tracking system incorporated into the
monitoring framework. This will be done through formative research process.
In recognition of the dynamism of the reforms it will be necessary to undertake a mid-
term review of the programme so as to maintain flexibility and respond to changing
circumstances. To measure the overall impact that PSDRP II will have on the business
environment and its contribution to job and wealth creation it will be necessary to
undertake an end of programme evaluation. TA will be required to develop the overall
M&E framework.
The evaluation of PSDRP II will have three elements namely quarterly reviews, mid-term
review and the final evaluation. The mid-term review and final evaluation will be
evaluated by external evaluators.
12.1Reporting Arrangements
The PSD unit will be responsible for the coordination and integration of the reporting on
the progress of results. The PSD Unit will produce semi annual and annual progress
reports against the logical framework. Beneficiary Ministeries and regulatory authorities
will be required to submit reports t0 the Steering Committee n a quarterly basis.
13.0Sustainability
PSDRP II will ensure that mechanisms are put in place to sustain the benefits of reforms.
Sustainability of the benefits of reforms and the continuation of the reforms will go
beyond the lifespan of the programme. This will be done through institutionalisation,
continued government commitment and ownership, and the provision of resources for
reforms. The framework within which sustainability will be articulated will be the PSD
strategy.
14.0Risks and assumptions

Risk management recognises a range of possible outcomes arising out of uncertainty,
provides structured systems for identifying and analysing those risks, and for devising
and implementing appropriate responses. A risk analysis of the PSDRP II has been
prepared in the form of a Risk Management Matrix (RMM), which is presented in Annex
3.
15.0Budget
29
The summary budget for PSDRP II for the period 2009 – 2014 is
provided in annex 5.
Annexes
Annex 1: LFA
Annex 2: Summary of PSDRP evaluation
Annex 3: Risk Management Matrix
Annex 4: PSDRP II budget for 2009
Annex 5: PSDRP II 2009-2014 budget
Annex 6: PSDRP II Implementation by Ministry/Institution
30
31
An nex 1: LF A
Hier ar ch y of Ob je ct iv es Ob je ct iv el y V erifiabl e I nd ica tor s ( OVI s) Mea ns of v erific atio n Ass umpt ion s
To promote and facilitate the development of a 1. Number of jobs created by the private 1. Economic Report • High Level Political commitment to PSD
competitive business environment in Zambia in sector 2. Labourforce surveys reforms
order to contribute to job and wealth creation 2. Improved “doing business ranking” 3. PSD unit surveys • Political Stability
3. Increased private sector investment 4. ZDA reports • Continued macro economic stability
5. BoZ reports • Continued support from Cooperating
6. CSO reports partners for PSD reforms
7. Doing business publication • No Further deterioration in the World
8. World Economic Forum Competitiveness Economy
Survey
9. ICA Investment Climate Assessment
Study
Pur pos e
To increase business access to markets and
finance and reduce costs of doing business in
Zambia.
Spe cific ob je cti ve 1 Obj ec tiv ely V erifi able I ndi cato rs Mea ns of v erific atio n Ass umpt ion s
(OVI s)
To reduce the number of licenses and unnecessary 1. Administrative 1. Business Licensing Inventory Reduction in number of licenses and
business licensing procedures and requirements. procedures/requirements and 2. Business Licensing Reform Committee streamlining of procedures leads to reduced
compliance costs for business licenses Report compliance costs
reduced by 30 % 3. Revenue Impact Assessment Report
4. Sector based Surveys
Outp ut s
1.1 Reduction in the number of licenses 1.1.1 Number of Licenses eliminated 1.1.1.1 PACRO annual reports • Cabinet approves the BLRC Report
1.2 Reduction and streamlining of licensing 1.2.1 Number of licensing 1.2.1.1 Minutes of Local authorities meeting • There is sufficient buy in for Business
requirements procedures/requirements reduced 1.3.1.1 PSD unit reports Licensing Reforms from private sector,
1.3 Establishment of E-registry 1.3.1 New Act for BRU enacted 1.4.1.1 MCTI reports ministries, regulatory authorities and local
1.4 Establishment of a Business Regulatory Unit (BRU) 1.4.1 Ministries and Regulatory Authorities 1.5.1.1 Online checks authorities
1.5 Establishment of E-governance systems, providing using computer based licensing 1.6.1.1 Doing Business reports
electronic licensing service delivery and net 1.5.1 Number of PACRO offices 1.7.1.1 PSD surveys
working/co-ordination/information sharing among 1.6.1 Number of Local Authorities
regulatory authorities appointed as PACRO agents
1.6 Decentralised business registration systems
Act ivi ties Inpu ts
12. Advocacy for cabinet approval of the Business
licensing reform Report
13. Issuance of legal instrument to revoke illegal 1. Fuel
licenses 2. Office consumables
14. Organize sensitization seminars for stakeholders 3. Conference facilities
15. Organise ministerial meetings to agree on the 4. Allowances (Local and abroad)
implementation 5. Short term TAs
16. Amendment of various legislation regarding 6. Consultancy fees
business licenses 7. Communication
17. Establish a tracking system for business licensing 8. Hardware and Software
reforms 9. Transport
18. Acquire hardware and design software
19. Identify host for the E-registry
20. Setting up the BRU
21. Set up the e-platform/system for targeted
regulatory authorities
22. Undertake an inventory of business licenses
(OVI s)
To stimulate the growth of the MSME sector in Zambia 1 Increase in the number of MSMEs that 1. ZBS reports • Political commitment to the MSME sector
operate in the formal sector 2. CEEC reports • Approval of the MSME policy
2 Number of jobs created by MSMEs 3 ZDA reports
4 Reports from Business Associations
5 FinScope Survey
6 CSO reports
Outp ut s
1.1 Develop indicators for the MSME policy 2.1.1 Increase in the number of MSMEs 2.1.1.1 ZBS reports
1.2 MSME policy approved and implemented able to access loans 2.2.1.1 CEEC reports
1.3 Credit guarantee scheme for MSME established 2.2.1 Increase in the number of MSMEs 2.3.1.1 ZDA reports
and operational accessing business development 2.4.1.1 DBZ reports
1.4 MSME incubators programme established and services 2.5.1.1 ILO reports
operational 2.3.1 Number of MSMEs covered by CGS 2.6.1.1 Reports from Business Associations
1.5 SME access to finance and market training 2.4.1 Increase in the number of MSMEs in the 1.7.1.1 CRB reports
programme rolled out by ZDA incubator centres 2.8.1.1 BAZ reports
1.6 Develop synergies among various stakeholders in 2.5.1 Number of MSMEs accessing 2.9.1.1 FinScope Surveys
the SME sector business from targeted large 2.10.1 Reports from large corporations
1.7 MSME council established corporation (linkages programme) 2.11.1 CSO reports
2.6.1 Number of MSMEs accessing CEE loans
2.7.1 Number of MSMEs trained under tailor
made programmes
2.8.1 Enactment of Credit reference
bureaus Act
2.9.1 Number of MSME surveys and
coordinated M&E efforts
undertaken
(All the information will be disaggregated by

Gender)
1. Develop a comprehensive MSME implementation
framework 1. Fuel
2. Develop system for the MSME credit guarantee 2. Office consumables
scheme 3. Conference facilities
3. Implement recommendations of the consultancy 4. Allowances (Local and abroad)
report 5. Short term TAs
4. Development of tracking system for CEE and BDS 6. Consultancy fees
5. Develop tracking system for the MSME access to 7. Communication
markets and finance programme 8. Hardware and Software
2
6. Develop case studies of successful MSMEs 9. Transport
7. Undertake MSME training tracer studies
8. Dissemination of the ZBS report findings
Spe cific ob je cti ve 3 Ob je ct iv el y V erifiabl e I nd ica tor s ( OVI s) Mea ns of v erific atio n Ass umpt ion s
To enhance private sector capacity to create 1. Increase in the number of employees on 1. ZFE reports • Tripartite council consensus on labour
employment and improve labour productivity permanent employment in the private 2. Ministry of Labour statistics reforms
sector 3. CSO statistics • Political commitment to labour reforms
4. ILO reports
Outp ut s
3.1 Reforms pertaining to business related labour 3.1.1 Legislation enacted and 3.1.1.1 TEVETA reports
completed and implemented. implemented 3.2.1.1 MSTVT reports
3.2 Labour reforms pertaining to retirement and 3.2.1 New law on minimum wage and 3.3.1.1 Ministry of labour reports
redundancy/severance packages completed and redundancy packages enacted 3.4.1.1 Productivity centre reports
implemented 3.3.1 System for measuring labour 3.5.1.1 LO reports
3.3 Systems for measuring and developing labour productivity in place 3.6.1.1 ZFE reports
productivity in Ministry of Labour or Productivity 3.4.1 Increased participation of private
Centre established sector in provision of skills
3.4 Skills development strategy developed development
Act ivi ties Inp ut s

1. Organise sensitization seminars for stakeholders 1. Fuel
2. Develop system for measuring labour 2. Office consumables
productivity 3. Conference facilities
3. Organise change management workshops 4. Allowances (Local and abroad)
4. Skills needs assessment survey 5. Short term TAs
5. Business related labour laws reviewed 6. Consultancy fees
6. Develop job creation indicators 7. Communication
7. Undertake labourforce survey 8. Hardware and Software
9. Transport
3
Spe cific ob je cti ve 4 Ob je ct iv el y V erifiabl e I nd ica tor s ( OVI s) Mea ns of v erific atio n Ass umpt ion s
To enhance private sector investment in 1. Ten (10) PPPs operational and providing 1. Signed PPP contracts Private sector has the capacity to participate in PPPs.
infrastructure development improved infrastructure and services 2. PPP unit reports
Outp ut s
4.1 PPP bill enacted 4.1.1 PPP Act enacted 4.1.1.1 Parliamentary records
4.2 PPP unit operational 4.2.1 PPP unit operational 4.2.1.1 PPP unit reports
4.3 Capacity of public and private sectors to 4.3.1 Training in PPPs 4.3.1.1 PSD reports
undertake PPP arrangements built
Act ivi ties

4. Dissemination of PPP policy and Act Inp ut s
5. Training and sensitisation workshops for
public and private sector in PPP 1. Fuel
arrangements 2. Office consumables
6. Development of PPP systems 3. Conference facilities
4. Allowances (Local and abroad)
5. Short term TAs
6. Consultancy fees
7. Communication
8. Hardware and Software
9. Transport
4
Spe cific ob je cti ve 5 Obj ec tiv ely V erifi able I ndi cato rs ( OV Is) Mea ns of v erific atio n Ass umpt ion s
To address barriers to trade expansion and 1. Volume of exports on an annual basis
enhance the capability of Zambia to efficiently 2. Quality of exported products
take advantage of trade opportunities abound 3. Diversity of export products
in the regional and other international markets 4. Efficiency of trade facilitation and logistics
5. Status of poverty measures including poverty head
count, poverty gap and poverty gap squared
measures
Outp ut s
5.1 Increased coherence in the policy, 5.1.1 Commercial, trade and Industrial policy • Policy document • The Zimbabwean government will be
regulatory and legal framework for trade • Commodities Export Strategy committed to implementing elements of
approved and launched by 3rd quarter of
expansion in Zambia document the OSBP under their jurisdiction
2009 (EIF)
5.2 Improved trade facilitation and border • National Services Export Strategy • The Tanzanian government will be
infrastructure & procedures 5.1.2 National commodities export strategy
• Intellectual Property Legislation committed to implementing elements of
5.3 Enhanced productive capacities in formulated and endorsed by 3rd quarter of the OSBP under their jurisdiction
• Chirundu One Stop Border Post
prioritised sectors 2009 (EIF) • Ministry of Works and supply will be
• Nakonde-Tunduma border posts
5.4 Increased legitimacy of the standards, 5.1.3 National services export strategy formulated • Infrastructure audit committed and proactive
quality assurance, accreditation and and endorsed by 3rd quarter of 2010 (EIF) • ZABS, PQPS and ZRA will remain
• System audit at the borders
metrology (SQAM) national system and committed and proactive.
product acceptability in the local, regional 5.1.4 Intellectual Property Legislation revised by PQPS, ZABS and ZRA
2nd quarter of 2010 (EIF) • Weigh bridges audit Ministry of • Ministry of Works and supply will be
and international markets.
5.2.1 Chirundu One Stop Border Posts (OSBP) fully Works and Supply committed and proactive
5.5 Enhanced capacity to trade policy
operational by end of 2010 (EIF/PSD Unit) • Government printers trade • Clients and clearing agents will be
analysis, formulation, negotiation, and
5.2.2 Nakonde-Tunduma OSBP developed and facilitation working group responsive and take advantage of the
discourse among PSDRP Stakeholders and
launched by 2013 (EIF/PSD Unit) • ZRA Measures
in the Ministry of Commerce, Trade and
5.2.3 Infrastructure improved at Nakonde, • Implementation partners will be
Industry. • Institutional surveys on client
Kasumbalesa, Kazungula, Katima Mulilo and responsive and committed
5.6 Increased regional and international charters existence
market access and penetration of Zambian Livingstone border posts by 2013 (PSD unit) • UNZA and other implementation
• ZRA and other border agencies
products 5.2.4 ZABS, PQPS and ZRA systems at HQ linked partners will remain committed to
• Skills Audit
5.7 Enhanced effectiveness in supervision, to key border posts (Nakonde, Kasumbalesa, setting up the Trade Policy Centre
• Exporter audit report/ZDA
programming and implementation of EIF Kazungula, Katimamulilo and Livingstone) by • Stakeholders will have interest in being
• Product surveys
and synergies and scale effects resulting 2013 (EIF) trained in trade policy
5.2.5 Three modern weigh bridges linked • Skills audit
from the better coordination MCTI • Stakeholder will have interest in
constructed and linked to HQ in Lusaka (EIF) • SQAM assessment study
coordination and other trade-related attending Trade Discourse
5.2.6 Operations of government printer revamped document
technical assistance initiatives
and upgraded by 2012 (PSD Unit). • Survey of policy, legislation,
5.2.7 Number of importers and clearing agents infrastructure, institutional set up,
taking advantage of trade facilitation capabilities, skills and procedures
initiatives such as Accredited Clients Scheme • Verification visit to the EPM trade
and Advanced Declaration increased by 40% policy centre
(estimation by 2013) (EIF/PSD Unit) • EPM TP centre launch report
5
5.2.8 All public institutions playing a key role in • Training of trainers training report
trade facilitation develop client/service from the EPM TP centre and NIU
charters by 2012 (PSD Unit) • EPM TP centre training report
5.2.9 Number of days it takes to exit or enter the • EPM TP centre trade policy course
major border posts reduced to less than 1.5 student register
days by 2012 (EIF/PSD Unit) • IF NIU activity reports
5.2.10 Equipment upgraded in ZABs PQPS and ZRA • Course participants’ reports
HQ and satellite offices by 2013 (EIF)
• Skills/on job performance
5.3.1 Volume, diversity and quality o Skills of
assessment
products from priority sectors increased by
• Trade discourse stakeholder round
2013 (EIF - monitoring)
table reports
5.3.2 Skills of producers and facilitators in the
• TEWG activity reports
sectors improve by 2013 (EIF - monitoring)
5.4.1 SQAM Assessment study conducted by end of • Trade discoursed stakeholder
2009 round table participants’ register
5.4.2 SQAM related policy, legislation, • MCTI technical departments
infrastructure, institutional set up and • Reports from regional economic
capabilities, skills and procedures realigned communities’ secretariats.
as per the recommendations of SQAM study • ZDA
by 2013 • ZDA
5.5.1 A trade policy training centre establish at the • Beneficiaries’ information
University of Zambia by end of 2009 gathering, management and
5.5.2 At least ten (10) local persons trained as dissemination techniques, skills
trainers of trainers and trainee in trade policy and systems assessment
and related matters by end of 1st quarter of • EIF focal point NIU staff record
2010 • EIF NIU activity reports
5.5.3 At least twenty (20) PSDRP stakeholders
trained in trade policy, policy analysis,
drafting, negotiations and advocacy at the
EPM centre annually starting from 2010
5.5.4 At least six (6) PSDRP stakeholders
facilitated and supported to participate in
trade policy-related training at identified
institutions annually
5.5.5 At least three (3) trade discourse and
awareness stakeholder round tables held in
different selected parts of Zambia annually
5.5.6 At least forty (40) stakeholders participate in
each trade discourse round table held
5.5.7 At least 2 issue-based short-term
consultancies provided to each of the
Ministry’s four technical departments every
6
year up to 2013
5.6.1 Reduced tariff and non-tariff barriers in
regional and international markets by 2013
5.6.2 Two market research missions undertaken in
identified markets every year
5.6.3 Two trade missions/or exhibitions/trade fairs
undertaken in identified markets every year
5.6.4 Market information gathering, management
and dissemination techniques, skills, and
systems improved to support institutions
5.7.1 EIF National Implementation Unit support:
Focal Point Advisor, National Trade Expert
and 2 Project Officers recruited and retained
for the duration of the project
5.7.2 Trade Expansion Working Group planning
retreats, meetings, workshops and other
activities supported throughout the duration
of the project
1. Conducting a comprehensive SQAM
Assessment Study (Legislation, 1. EIF NIU personnel
institutions, infrastructure – including 2. Motor vehicle
laboratories and personnel) 3. Fuel
2. Implementation of the SQAM Assessment 4. Office consumables
Study recommendations 5. Conference facilities
3. Conducting a GAP assessment and 6. Trade infrastructure development and ICT facilities fund
Capacity Needs Study of Government 7. Productive capacities enhancement fund
Printers 8. Allowances (Local and abroad)
4. Setting up of a Trade Infrastructure 9. Short term TAs
Development and ICT facilities Fund
within PSDRP
5. Training, workshops, seminars and
meetings
6. Provision of resources for foreign and local
travel
7. Provision of resources for short-term
consultancies
8. Provision of budget line for the EIF NIU
staff operating costs
9. Undertake market research
10. Undertake trade fairs/missions
7
(OVI s)
To develop and strengthen the capacity of government’s 1. Increased GRZ budget allocations for 1. Reports by Ministries 1. Ministries and Regulatory
responsiveness to PSD interventions private sector reforms 2. Yellow book Authorities receptive to change
2. Ministries/regulatory authorities develop 3. MTEF
and implement reforms through annual
workplans and budget
Outp ut s
6.1 Ministries and regulatory authorities annual work 6.1.1 Performance based incentives in 6.1.1.1 Ministries’ work plans and budgets
plans and budget include private sector reform place 6.2.1.1 Ministry and regulatory authorities
activities. 6.2.1 Reform issues taken up within reports
6.2 Best practices identified and internalised within Ministries and regulatory authorities 6.3.1.1 PSD unit report
ministries and regulatory authorities 6.3.1 Number of reform champions active
6.3 Customer charters developed in reforms
6.4 Effective mechanism to respond to private sector 6.1.1 Annual work plans and budget
needs established include reform issues
6.5 Capacity to undertake Regulatory Impact 6.5.1 Number of ministries and regulatory
Assessments (RIA) created within Ministries and authorities using RIA
regulatory authorities. 6.6.1 Identified best practices
6.6 Private sector engagement strengthened implemented
6.7 Incentives for reform champions established
6.8 Implementation of PSD reforms enhanced
1. Training in analysis of reform issues, reform 1. Fuel
planning, RIA and budgeting 2. Office consumables
2. Workshops and sensitisation in change 3. Conference facilities
management 4. Allowances (Local and abroad)
3. Criteria developed for incentives, rewards and 5. Short term TAs
awards for reform champions 6. Consultancy fees
4. Training the private sector in advocacy skills, 7. Communication
lobbying and RIA 8. Hardware and Software
5. Study Tours to learn best practices 9. Transport
8
(OVI s)
To create broad awareness and support for Private 1. Number of people aware about PSD 1. PSD reports Continued and enhanced political
Sector Development Reforms reforms 2. Audience surveys reinforcement of reform communication
2. Number of active champions supporting 3. General surveys
PSD reforms
3. Number of print and electronic media
supporting PSD reforms
Outp ut s
7.1 Broad awareness and support for PSD reforms 7.1.1 Positive perception of PSD reforms 7.1.1.1 Perception surveys
created and enhanced 7.1.2 Reform communication plan 7.1.1.2 PSD reports
developed and implemented 7.1.1.3 Communication plan

1. Develop a implementation plan 1. Fuel
2. Brand PSD reforms will be branded to ensure wider 2. Office consumables
recognition 3. Conference facilities
3. Create synergies between and across reforms 4. Allowances (Local and abroad)
4. Identify and communicate reform success stories 5. Short term TAs
5. Communicate reform results 6. Consultancy fees
6. Communicating the link between “Doing business” 7. Communication
publications and PSDRP 8. Hardware and Software
7. Communicating impact in selected industries 9. Transport
8. Regular review of communication tools
9
Annex 2: Su mmary of PSD RP ev aluation
Background
The Private Sector Development Reform Programme (PSDRP), which
commenced at the end of 2005 and was supposed to finish end of 2008 was
evaluated during the period December 2008 to February 2009. The evaluation
made a thorough investigation of the programme structures, the results
achieved and the difficulties it has faced. As there is interest by the GRZ as
well as the cooperating partners to develop and implement a second phase of
PSDRP, the evaluation has made specific recommendations how PSDRP II
could be established.
Main findings
The main findings are listed below:
• The component structure was not helpful to project management as they

were too broad to report against and had limited focus on actual reform
areas
• Private sector high level policy dialogue was disengaged, private sector
interest were less central to the programme at the highest level
• The bottom up orientation of the process created reform bottlenecks
• The PSD-SC set out as a strategic body but increasingly became a
management committee
• The PMU is called management unit but has roles of a secretariat assigned
to it
• ZBF is not the only private sector representative in Zambia and ZBF is not
universally accepted as representing the private sector vis-à-vis
government in PSDRP
• Many Working Groups (15) were established and while many
recommendations, policies, laws, Acts and Bills were drafted precious few
have led to reforms that have been fully enacted
• The PSD Reform Process for specific reforms was not mapped out and
specific bottlenecks were not identified. There was no performance
management system in place to track the progress of the process and most
reforms have not gotten enacted/implemented
• The PSD Project Process was not mapped out and specific bottlenecks were
not identified. There was no performance management system in place to
track the progress of the project process and this coupled with a PMU with
limited operational management authority has led to undue delays having
a major negative effect on the PSD Reform Process
• Status of reforms under PSDRP is provided in table 3 below:
Table 3: Status of reforms under PSDRP (from Key findings per PSDRP
objective)
# Objective Results Conclusion
1 Policy Environment & • ZDA operational • One out of eight outputs achieves
Institutions • Small claims court opened but not
busy
2 Regulations & Laws • Amended labour law in • No actual change at private sector
consultation at cabinet level level yet
• Reduced time for business start up • Benefit at private sector level
(Pacro)
• Reduced time for VAT refunds • Benefit at private sector level
3 Infrastructure • 3 ICT bills pending approval • No actual change at private sector
level yet
• PPP draft bill approved and PPP • 1 PPP MoU signed
unit established
4 Business facilitation & • Business licensing report produced • No actual change at private sector
economic diversification • Land bank system level yet
• More land available for development
• Sector groups (housing, tourism • Reports but no reform
and livestock) reports
5 Trade Expansion • Plans and studies only • Nor results with regards to
increasing Zambian competitiveness
6 Local Empowerment • Citizens Empowerment bill passed • Not resulting in practically
increasing MSME economic
• MSME policy drafted empowerment
• Policy not approved, no practical
results yet
Table 1 clearly shows that although much work has been done actual outcomes
improving the competitiveness for the Zambian private sector are few.
Key conclusions and recommendations for further reforms

The key conclusions and recommendation for further reforms are listed
below:
• Continued reforms are key to Zambia’s further development
• Due to lack of practical tangible results at Zambian competitiveness level,
the Zambian private sector is loosing interest in the reform program.
PSDRP II will need to provide tangible results within 6-18 months
maximum
• PSDRP II should built on the work done by some of the different reform
working groups within the first phase PSDRP
• Donors are willing to fund phase 2 of the programme however need to have
a clear proposal with a clear results and indicators of results framework
• Key reforms will need to be undertaken within the ministries and
ownership at that level needs to be ensured. Working Committees should
be anchored in relevant ministries
• ZBC or an advisory body should be reactivated
• Low profile high level advisory body comprising of top private and public
sector should be established able to provide support to reform processes
• ZBF is not needed as exclusive gate keeper for the private sector. PSD can
be represent itself through sector associations on a rotational basis
• SC should move from operational to strategic matters
• PMU, to be renamed PSD Unit needs management responsibility for the
operational management of the program
• Ensure the development of performance indicators/dashboards at all levels
within the reform and project processes
2
• PSDRP bottom-up orientations (through Working Committees) through
ministry structures to cabinet will need to be complemented by high level
GRZ support/backstopping. This should be based on information provided
through effective performance management systems/dashboards with
regards to both the actual reform process as well as the PSDRP II project
process
• Monitoring of PSDRP should be on attaining outputs in specific reforms
areas as well as outcomes
• Communication needs interface with the public and the private sector
• Need to have communication on tangible results achieved by the reform
processes
Future program areas

• Reduced regulations and licenses
• Liberalisation of labour markets
• SME development
• 2 other sectors
3
4
An nex 3: Risk ma nageme nt matri x
Ris k E vent Ris k C on seq ue nc e Lik eli hood Imp ac t Ris k P rio rit y Ris k M it iga tion Str at eg y Respo ns ibilit y
Lack of ownership in Ministries and • Reduced outcomes H H 5 • Development of specific performance • PSD Unit
Regulatory Authorities, result in • Loss of interest private indicators/dashboards at all reform
reforms being blocked or delayed sector process steps will enable the program to
• PSDRP II fails see where bottlenecks are
• MRB meeting will provide backstopping • MRB
support to unblock reform process based
on dashboards
• Capacity building to GRZ • PSD Unit
• Chairperson Working Committee • Chairperson WC,
(Director) reports to PS, PS reports to SC PS
& DSC
The reform project process is unable • Reform process not M H 4 • PSD Unit has mandate to facilitate and • PSD Unit
to provide effective support to the effectively supported by co-ordinate PSDRP II
Working Committees and Line the project process • Each reform will be supported by a PSD • PSD Unit project
Ministries in developing and • Reduced outcomes project manager responsible for manager
implementing reforms facilitating reforms in Line ministries
• Development of specific performance • PSD Co-ordinator
indicators/dashboards at all project
process steps will enable the program to
see progress and take action
• MRB meeting will provide backstopping • MRB
support to unblock reform project
process based on dashboards
Reform outputs do not lead to • Zambia’s competitiveness L H 3 • Outcome measurement matrixes • PSD Unit
outcomes/practical results at private not improved developed
sector level • Private sector will loose • PPD at many levels within PSDRP II will • ZIBAC, ZBC, SC,
interest and disengage ensures rapid feedback on non delivery of SAG, MRB and
outcomes Working
Committee
Lack of political will and commitment • Loss of interest in GRZ M H 4 • PPD structures • ZIBAC, ZBC, SC,
to pursue reforms structures • Development of Zambian PSD strategy SAG, MRB and
• Reduced outcomes • Reform results will increase political Working
commitment Committee
• PSD Unit
• All
PSD Unit has difficulty to establish • Loss of effectiveness of M H 4 • Ad hoc TA for establishment of • PSD Unit, TA
performance dashboards for reform & the programme performance indicators/dashboards,
project processes, develop • Reduced outputs and analysis of reform processes, monitoring
communication plan, monitoring outcomes and development of communication plan
systems
2
Priority listing of risks
Likelihood Impact Risk Priority

High High 5
High Medium 4
Medium High 4
High Low 3
Medium Medium 3
Low High 3
Low Medium 2
Medium Low 2
Low Low 1
Annex 6: PSDRP II IMPLEMENTATION BY MINISTRY/INSTITUTION
Ref orm Ar ea Obj ec tiv e Impl eme nt ing Mi ni st ry /In sti tu tio n
Business licensing and regulatory reform To reduce unnecessary business licensing procedures and requirements to reduce the • All Government Ministries and Regulatory Authorities
costs of doing business • All Local Authorities
To stimulate the growth of the MSME sector in Zambia • ZDA
• BoZ
SME Development
• DBZ
• MCTI
• ILO
• Credit Reference Bureau
• MLSS
Labour and labour Productivity To enhance private sector capacity to create employment and improve labour
productivity
To enhance private sector investment in infrastructure development • MoFNP
PPP development • MCT
• MWS
To address barriers to trade expansion and enhance the capability of Zambia to • MCTI
efficiently and effectively take advantage of trade opportunities abound in the regional • ZDA
and other international markets. • ZRA
Trade expansion
• ZABS
• Immigration Dept
• ZWMA
To develop and strengthen the capacity of government’s responsiveness to PSD • All Economic Ministries
interventions • All Regulatory Authorities
Capacity building for private sector reform
• All local Authorities
in GRZ
• PAC (Cabinet Office))
• PSMD (Cabinet Office)
Reform communication To create broad awareness and support for Private Sector Development Reforms • PSD Unit
Zambia PSD strategy To develop a comprehensive and systemic government owned PSD agenda • All PSD Stakeholders (Government, Private sector, Cooperating Partners
& Civil Society)
Gender mainstreaming To enhance and facilitate the inclusion of a gender dimension in private sector • GIDD
reforms. • All Economic Ministries
• All Regulatory Authorities
• All local Authorities
Doing Business Reforms Ensure implementation of the FSDP by appointing a committee to oversee its • Government Regulatory Institutions
Activities implementation • Local Authorities
• Relevant Government Ministries

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(This Document is the Property of the Government of the

PRIVATE SECTOR DEVELOPMENT REFORM PROGRAMME

Abbreviations and Acronyms 3

1.0 Introduction and Background 10

2.0 Situation Analysis 12

2.1 Existing challenges to business 12

3.0 PSDRP II Programme Focus 14

3.1 Priority reform areas 14

4.0 Programme Goal 15

5.0 Programme Purpose 15

6.0 Specific objectives, outputs and activities 15

7.0 Cross cutting PSD issues 20

8.0 Zambia PSD Strategy 23

9.0 Program strategies 24

10.0 Institutional Structure 25

11.0 Implementation process 28

12.0 Monitoring and Evaluation 28

14.0 Risk and assumptions 29

The PSDRP II document outlines the framework of Governments private sector

• Meetings to internalize and Ministries and

• Meetings with the private

• Meetings with various

• Request for TA to develop TOR June

5. Implementation • Development of BLR June BLR 2,532,000,000

13. Development • Identify best practice in June PSD strategy 800,000,000

• Strategy development August-

Programme Name: Private Sector Development Reform Programme (PSDRP II)

Goal: To promote and facilitate the development of a competitive business

Key outcome: Competitive Business Environment

Key results: Administrative procedures/requirements and compliance costs reduced

Programme Duration: June 2009 – June 2014

Budget: K180.0 billion

Financing: GRZ with supplementary support from Cooperating Partners

1. Business licensing and regulatory reform

Cross cutting Issues:

a. Capacity building for private sector reform in GRZ

Implementation: Ministries and Regulatory authorities

Description: In order to address the business environment an implementation

In order to address the business environment an implementation framework in

A summary of the main findings are provided in Annex 2. In addition to the

2.1 Existing Challenges to Business

2.1.1 Licences and regulations

2.1.2 High cost of inputs

2.1.3 Inadequate Infrastructure

2.1.4 Access and costs of finance

2.1.5 Labour regulations

2.1.6 Low productivity

2.1.7 Complicated trade arrangements

2.1.8 Obtaining and transferring ownership of land and properties

i. Policy environment and institutions

Nevertheless in a number of areas (business licensing, labour reforms, PPP) a

3.1 Priority Reform Areas

a) Ability to address challenges to business

1. Business licensing and regulatory framework

The reforms will be further prioritised in the Tourism, Agriculture and

To provide the overall Government long term perspective of and

3.2 Guiding Principles of PSDRP II

3.2.1 Result oriented:

3.2.3 Public-Private Dialogue (PPD)

To promote and facilitate the development of a competitive business

PSDRP II will contribute to the central theme of Zambia’s Fifth National

The purpose of PSDRP II is to increase business access to markets and

6.0SPECIFIC OBJECTIVES, OUTPUTS AND ACTIVITIES