By Prof. Lubinda Haabazoka

By any economic standard, Zambia is on the verge of one of the most significant statistical transformations in its modern history. While many people associate economic growth solely with factories being built, mines opening, or exports increasing, there is another important process that can dramatically change how a country’s economy is viewed both locally and internationally: Gross Domestic Product (GDP) rebasing.

The Zambia Statistics Agency (ZamStats) has announced that 2023 has been selected as the new base year for Zambia’s GDP, replacing the current benchmark year of 2010. Although rebasing does not create a single new mine, factory or farm, it is highly likely that Zambia’s measured GDP will leapfrog significantly, providing a much larger and more realistic picture of the country’s economy.

Gross Domestic Product (GDP) represents the total monetary value of all final goods and services produced within a country’s borders over a given period, usually one year.

Economists measure GDP using three approaches:

• Production (Value Added) Approach
• Income Approach
• Expenditure Approach

Using the expenditure method:

GDP = Consumption + Investment + Government Expenditure + (Exports − Imports)

GDP serves as the primary indicator used by governments, investors, lenders and international institutions to assess economic performance. It influences fiscal policy, monetary policy, debt sustainability assessments, investor decisions, sovereign credit ratings and national development planning.

GDP rebasing simply means changing the reference year used to calculate economic output.

Every economy evolves over time. New industries emerge while others decline. Consumer behaviour changes. Technology advances. Statistical techniques improve.

If the benchmark year remains unchanged for too long, GDP calculations begin to underestimate the true size of the economy.

Zambia has been using 2010 as its benchmark year for the past fifteen years.

Since then, the economy has undergone enormous structural transformation.

Today Zambia has:

• A far larger digital economy
• Rapidly growing ICT services
• Expansion in mobile money
• Increased financial inclusion
• Significant construction activity
• Growth in renewable energy
• Modern logistics and transport services
• Expansion of tourism
• New mining investments
• A much larger private sector

Many of these activities were either very small or poorly captured in 2010.

According to ZamStats, 2023 was selected because it represents a relatively normal economic year with comprehensive benchmark data.

The rebasing exercise incorporates:

• The 2025 Economic Establishment Census
• The 2024 Household Budget Survey
• Updated Statistical Business Register
• Administrative government data
• Supply and Use Tables
• Improved international statistical methodologies

This represents the most comprehensive statistical update Zambia has undertaken in many years.

One misconception must immediately be corrected.

GDP rebasing does not create new wealth.

• No additional copper is mined.
• No extra maize is harvested.
• No new factories suddenly appear.

Instead, rebasing measures existing economic activity more accurately.

Think of weighing yourself using an old scale that underestimates your weight by 10 kilograms. Buying a new digital scale does not make you heavier, it simply provides a more accurate measurement.

The same principle applies to GDP.

History suggests that Zambia’s GDP could rise substantially after re-basing.

Several African countries have experienced remarkable upward revisions.

Nigeria

When Nigeria re-based its GDP in 2014, its economy increased by approximately 89% overnight, overtaking South Africa to become Africa’s largest economy.

Previously under-measured sectors included:

• Telecommunications
• Nollywood
• Banking
• Retail
• ICT
• Entertainment

No new production occurred overnight.

Only the measurement improved.

Ghana

After rebasing in 2010, Ghana’s GDP increased by around 60%, instantly changing the country’s income classification and economic standing.

Kenya

Kenya recorded a GDP increase of approximately 25% after incorporating rapidly expanding sectors such as mobile money, ICT, real estate and financial services.

Tanzania

Following rebasing, Tanzania’s GDP rose by nearly 30%, reflecting stronger services and industrial activity than previously measured.

These international experiences demonstrate that economies often become much larger statistically when outdated benchmark years are replaced.

Several sectors have expanded dramatically since 2010.

Mining

Mining has become more technologically advanced while production capacity continues expanding through investments at:

• Mopani Copper Mines
• Kansanshi
• Lumwana
• Konkola Copper Mines
• Kalengwa
• Lubambe

Modern mining services that were previously poorly measured now contribute substantially to GDP.

Financial Services

The financial sector has transformed.

Today Zambia has:

• Mobile banking
• Digital lending
• FinTech innovations
• Electronic payments
• Agency banking
• Mobile money

Many of these activities scarcely existed in 2010.

ICT and Digital Economy

Perhaps the biggest change has occurred in ICT.

Today Zambia’s economy includes:

• Online businesses
• E-commerce
• Software development
• Cloud computing
• Digital marketing
• Data centres
• Internet service providers
• Mobile applications

These sectors contribute significantly to value creation.

Construction

Over the past decade Zambia has experienced sustained infrastructure development through:

• Roads
• Housing
• Commercial property
• Industrial parks
• Shopping malls
• Energy infrastructure

Construction now represents a much larger share of GDP.

Tourism

Tourism has diversified considerably with investments in hospitality, conferencing, adventure tourism, domestic tourism and aviation services.

Renewable Energy

The emergence of solar energy, mini-grids, independent power producers and private electricity generation represents an entirely new dimension of economic activity.

A larger GDP has several positive implications.

Improved Debt Indicators

One of the most important ratios used globally is:

Debt-to-GDP Ratio

If GDP increases while debt remains unchanged, the debt burden automatically appears lower relative to economic output.

This strengthens perceptions of debt sustainability.

Higher GDP Per Capita

GDP per capita is calculated by dividing GDP by population.

If GDP rises after rebasing, Zambia’s average income per person also increases statistically.

This improves international comparisons.

Better Investment Profile

International investors rely heavily on GDP statistics.

A larger economy often signals:

• Greater market size
• Higher purchasing power
• More investment opportunities
• Stronger business potential

This can attract additional foreign direct investment.

Improved Credit Assessment

Credit rating agencies analyse GDP extensively.

A larger and more diversified economy generally improves sovereign risk analysis because it demonstrates broader productive capacity.

Better Economic Planning

Government policies become more effective when they are based on accurate statistics.

Budget allocations, infrastructure planning, industrial policy and poverty reduction programmes all benefit from improved economic measurement.

For decades, Zambia was viewed primarily as a copper-producing economy.

Today, services, finance, ICT, logistics, tourism, renewable energy, construction and private enterprise contribute far more than they did fifteen years ago.

These sectors deserve to be properly measured.