Climate Compatible Growth’s Political Economy Unit (PEU) at University College London, together with the Southern African Institute for Policy and Research (SAIPAR), has launched a report examining how mineral wealth, regional cooperation and the energy transition can support inclusive industrial development.
Political Economy of Industrialisation in the Context of Regional Integration: Zambia and the Southern African Development Community examines how political interests, institutions and international relationships shape industrial policy, investment and the distribution of development benefits.
The report identifies persistent barriers to diversification, including copper dependence, constrained finance, weak connections between mining and other productive sectors, and unreliable electricity.
It highlights the importance of straightening, regional markets, resilient clean-energy systems and infrastructure investment that strengthens domestic production and regional value chains.
The report is called “Political Economy of Industrialisation in the Context of Regional Integration: Zambia and the Southern African Development Community (SADC)”. It is written by Dale Mudenda, Charles Simwanza, and Marja Hinfelaar (SAIPAR), Lucas Somavilla, Yacob Mulugetta, Gerald Arhin (STEaPP).
Read the report here.
Recommendations include coordinated regional critical-minerals strategies, stronger collective negotiations with international investors, national investment in technology and skills, and enforceable provisions for local procurement, employment and community participation.
The findings provide an evidence base for policymakers, regional institutions, development partners and investors seeking to translate mineral and energy investment into lasting structural transformation.
The report offers timely evidence to help discussions at COP31 on green industrialisation, just transitions and clean-energy investment in Africa. The topic of ‘green industrialisation’ is high priority this year, including for COP31 Presidency Action Agenda.
Report Executive Summary
Political Economy of Industrialisation in the Context of Regional Integration: Zambia and the Southern African Development Community combines historical analysis, literature review, stakeholder mapping, key informant interviews and analysis of trade and energy data. It investigates how political interests, institutional arrangements and international relationships shape industrial policy, investment decisions, and the distribution of development benefits.
The study traces Zambia’s industrialisation trajectory from independence through nationalisation, structural adjustment, and privatisation to renewed interest in critical minerals. It finds that successive periods of mineral-led growth have delivered limited economic diversification. Copper dependence, policy instability, constrained finance and weak connections between mining and other productive sectors continue to restrict industrial transformation.
The regional analysis highlights uneven productive capabilities, trade barriers and infrastructure gaps across SADC. It shows that regional markets provide important opportunities for Zambia’s manufactured and processed goods, making regional cooperation central to diversification. Reliable, affordable and cleaner electricity is equally essential: drought-sensitive hydropower, inadequate transmission infrastructure and weaknesses in utility governance constrain industrial activity and cross-border electricity trade.
The report examines transport corridors, including Lobito and TAZARA, and the proposed Democratic Republic of Congo–Zambia battery value-chain initiative. These cases illustrate opportunities to expand local processing and manufacturing, alongside challenges involving geopolitical competition, policy coordination, skills, technology and local participation. Realising their industrial potential requires infrastructure and investment agreements that support domestic production and wider regional development.
Recommendations include coordinated regional critical-minerals strategies, stronger collective bargaining with international investors, harmonised policies and complementary regional value chains. The report also calls for investment in resilient clean-energy systems, industrial infrastructure, technological upgrading and skills, with enforceable provisions for local procurement, employment and community participation.
For Zambia, priorities include stable and transparent mining fiscal arrangements, dedicated mechanisms to reinvest mineral revenues in diversification, and sequenced value-addition strategies linked to achievable industrial milestones.
The report provides an evidence base for policymakers, regional institutions, development partners and investors seeking to align mineral development and energy investment with lasting structural transformation and more widely shared benefits.