VNc#3026: The 10th indispensable action – connect Zambian production to markets
By Comm. VPM Nyasulu aka @shikulu-LUBUTO
In my last week’s article, I was emphasizing the argument that the Government of the Republic of Zambia-GRZ must power a productive economy to assist indigenous micro, small and medium enterprises in Zambia to thrive after nearly a 50-year-old governmental effort. I think it is fair to say that at some point the challenges of making Zambia’s i-MSMEs work made various bureaucrats lose hope and give up!
In today’s article, I qualify the need to ramp up Zambian i-MSMEs production and then connect the same to markets. This cannot be over-emphasized because in truth, a country does not thrive economically merely because it produces. It becomes economically transformative when what it produces can reach customers competitively.
This is the challenge that must complete our discussion of Zambia’s productive infrastructure revolution. We can train entrepreneurs, finance businesses, open Government procurement markets, localise value chains, make regulations more i-MSMEs friendly, build productive skills, establish enterprise ecosystems, provide reliable energy and digital connectivity, but if Zambian products cannot move efficiently from producer to customer, our productive transformation will remain incomplete.
The tenth indispensable action is therefore to connect Zambian production to markets. From factory gate to customer, for an i-MSME, production is only half the battle; the other half is getting the product to market.
A farmer may produce quality vegetables but lose money because transport is expensive. A processor may manufacture excellent products but lack affordable warehousing. A furniture manufacturer may produce competitively but struggle to reach customers outside the local area.
A Zambian manufacturer may even produce an export-quality product but lose the international market because logistics costs make it uncompetitive. Therefore, the GRZ must adopt a cost-to-market approach to economic infrastructure.
The question should be: how much does it cost a Zambian i-MSME to get one unit of product from the point of production to the customer? That number matters enormously.
Infrastructure must reduce the cost of doing business. Roads matter and so do rail, air transport, border posts, warehouses, markets and regional corridors: but their ultimate value should be measured partly by the extent to which they reduce the cost and time of moving goods.
A road is not economically transformative simply because kilometres have been constructed. It becomes transformative when it enables producers to reach markets faster and cheaper. The last mile must be built.
Large infrastructure often focuses on major corridors but many i-MSMEs operate far from those corridors.
The farmer, processor, artisan and rural manufacturer often faces the most expensive part of the journey: the last mile!
The GRZ should therefore pay much greater attention to feeder roads, rural collection centres, aggregation facilities, local markets and linkages between productive communities and major transport corridors: a national highway may connect two cities but an effective feeder network connects production to the highway. That distinction matters.
Aggregation must simply be built into the System because small producers often face another disadvantage: scale! One farmer may have too little produce to fill a truck. One honey producer may have too little volume to negotiate effectively. One small processor may not be able to secure favourable logistics rates. Aggregation can change this.
Cooperatives, producer organisations, enterprise associations and private logistics providers should be supported to aggregate products and services. This can reduce transport costs, improve bargaining power and create more reliable supply for processors and buyers.
Small producers can achieve scale by organising together. Warehousing is economic infrastructure. Zambia must also rethink the importance of storage. A producer forced to sell immediately after harvest is often a price taker. A producer with appropriate storage has greater control over when and how to sell.
As stated in earlier articles, warehousing, silos, cold rooms and other storage infrastructure should therefore be integrated into productive value chains. This is particularly important for agriculture, food processing, fisheries, livestock and other perishable products like tomatoes.
Storage is not merely about keeping products. Storage creates market power, modernised markets. A modern productive economy requires markets that are clean, organised, accessible, digitally enabled and connected to logistics. Wholesale markets should increasingly connect directly to production zones. Retail markets should provide predictable access for indigenous producers. Digital marketplaces should complement physical markets.
The objective should be to move from fragmented informal trading toward integrated market systems. With this 10th action, we can now see the architecture more clearly. Zambia’s i-MSME transformation cannot depend on one policy. It requires an interconnected system. We need:
1. A National Indigenous Enterprise Development Strategy-NIEDS, 2. Fundamental reform of access to finance, 3. Government procurement as a market-development instrument, 4. Deep localisation of indigenous value chains, 5. Continuous regulatory reform, 6. An entrepreneurial and productive skills revolution, 7. A productive infrastructure revolution, 8. Indigenous enterprise ecosystems-IEEs, 9. Productive energy and digital connectivity and most importantly, 10. Integrated logistics and market access-ILMA.
The said ten interconnected concepts basically seek a response to the central question: What must Government do to make it easier, cheaper and more profitable for a Zambian to produce in Zambia?
