Certain goods require a certification to be imported, like meat (certification available from the Veterinary Department), plants and seeds and fruits (phytosanitary certification from Mount Makulu Research Station), food and drugs (Ministry of Health and Zambia Medicines Regulatory Authority), firearms and ammunition (Zambia Police), and gemstones and scrap metal export (Ministry of Mines). Import licensing is required for most agricultural products.
Customs Duties and Taxes on Imports
Customs duty is applicable on goods imported into Zambia. The basis for calculating duty is cost, insurance, and freight (CIF). There are three types of import duties: customs duty, import excise, and import VAT. The rate of custom duty varies from product to product. According to data from the World Bank, dating back to 2015, the effectively applied tariff weighted average for imports is 3.95%, whereas the average for the most favoured nation principle is 8.95%.
Zambia is a member of the World Customs Organisation and does comply with the harmonised customs system (HS).
Commercial documents such as a bill of lading, airway bill, and commercial invoice are required to clear goods with customs. The form CE 20, the standard form for entry and exit, is used for clearance at border posts. Zambia Revenue Authority (ZRA) has implemented the automated system for customs data (ASYCUDA) world system which provides a platform that leads to a paperless customs clearance and domestic tax processes. Customs may request for a physical examination or additional documentation to ensure that a declaration is correct. An invoice is issued for immediate payment for the goods to be released; when all formalities are concluded and payment has been made, Customs will issue a release order for the goods.
Samples are admitted against a deposit equal to the full duty. They must be listed in duplicate and are checked on importation and again on re-exportation which must be within 12 months.
The formal food wholesale and retail sector in Zambia was estimated to be worth USD 12.85 billion in 2016. Before the liberalisation of the economy in the 1990s, the sector was dominated by state-owned stores as well a number of traditional small-scale family-owned businesses. In recent years however, private supermarket chain stores have been spreading across Zambia. As a result, the sector is now dominated by foreign regional supermarket chains (such as Shoprite, Spar and Pick 'n Pay). However, it is estimated that up to 70% of households buy their food through informal channels, mainly fom traditional small stalls, street vendors, informal shops and kiosks, as well as marketplaces. Nevertheless, the number of people shopping in supermarkets is constantly growing, and with the increase in the urbanisation rate there will be more opportunities for formal retailing. Total food consumption is predicted to grow at 10% over the next few years (source: Reportlinker).
According to the same institution, the number of mobile subscriptions reached 13.4 million, representing a penetration rate of 81.92%. The market is dominated by MTN Zambia with approximately 6 million subscribers, followed by Airtel Zambia with 5 million customers and Zamtel with just over 2.2 million. Despite an increasing access, internet connection speeds are still slow, averaging 2.3 Mbps compared to a global average of 7.2 Mbps. While access to ICTs is steadily increasing, access in rural areas is still far too low due to the high costs of hardware and software, poor network coverage, and high levels of illiteracy.
The most popular web search engines in Zambia are Google (93.8%), Bing and Yahoo (3.8% and 1.6% respectively).
E-commerce is still in its infancy in Zambia, with different growth rates for different channels and mobile commerce being by far the fastest growing. According to UNCTAD’s 2018 B2C E-commerce Index, Zambia ranks 127th out of 151 economies worldwide in terms of e-commerce, and 26th out of 44 African countries. Nowadays, most Zambians use the internet to purchase electricity tokens and pay for digital TV and water bills. The most sold goods range from electronics to footwear, clothing, accessories, motor vehicle and their spare parts. When it comes to cross-border transactions, the top countries from where Zambians make online purchases are the USA (eBay), United Kingdom (eBay) and China (Alibaba). However, Zambians still experience several challenges when purchasing online, like the lack of an ad hoc legislation, poor or misleading information by the service provider such as contact details, right to withdrawal, non-receipt of the item purchased, terms and conditions, costs such as customs duty, value added tax and import declaration fee. As most of the transactions are still related to utilities rather than retail, the most commonly consumed platforms include the Zambia Revenue Authority website (used for paying domestic taxes and customs services), the National Pension Scheme Authority and the Patent and Company Registration Office. Zoona – an electronic transfer service that enables consumers to send or receive money across Zambia – is also popular. Finally, Dot Com Zambia enables users to buy online from national and foreign retailers. The most common payment methods for online transactions in Zambia are mobile-based or through mobile banking, while credit cards are less common. Recently launched platform Paybills.co.zm allows Zambian customers to pay utility bills, television subscriptions, and buy air time using VISA or MasterCard. Zambians are heavy social network users. Indeed, a research by ZICTA showed that in 2016 63% of the internet users in the country spend their time online on social networking sites, and the ratio is estimated to have increased in the past few years. According to data from NapoleonCat, the country currently counts 2.1 million Facebook users, while Instagram and Snapchat have less subscriptions (0.3 and 0.2 million respectively).
Organizing Goods Transport
Since Zambia is landlocked country, all cargo originating from overseas has to move via the ports of Dar es Salaam (Tanzania), Durban (South Africa), or Walvis Bay (Namibia).
According to data from CIA, agriculture accounts for 7.5% of GDP and the industry sector for 35.3%. The main cultivations are crops (maize, cotton, soybeans, tobacco, groundnuts, paprika, sorghum, wheat, rice, sunflower seeds); while the key industries of Zambia include copper mining and processing, construction, emerald mining, beverages, food processing, textiles, chemicals, fertilizer and horticulture. The services sector contributes to 57% of GDP, due in particular to the retail and tourism sub-sectors.
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