[{"bbox": [99, 75, 1159, 316], "category": "Text", "text": "Change from 07/2021 outline the GRZ intends to reduce its greenhouse gas (GHG) emissions by 25% by 2030. With substantial international support, the national target increases to 47%, compared to 2010 levels. In line with Zambia's NDCs, there is a need to move to cleaner and more renewable energy, by phasing out fossil fuels (coal and charcoal), to meet the commitments made at COP26. It will be important to switch to green technologies in the agriculture, transport and manufacturing sector, and to transform the current systems to be more circular in nature. This can be done by eliminating waste and pollution, circulating products and materials, and regenerating nature. Opportunities in the area of circular economy also featured high during several statements made at the 1st EU-Zambia Economic Forum in 05/2022. The newly created MoGEE is currently developing a National Policy on Climate Change (NPCC) and a Green Growth Strategy coherent with the 8NDP and the country NDC"}, {"bbox": [99, 326, 1159, 407], "category": "Text", "text": "The action supports implementation of the 8NDP in terms of economic diversification climate action. It will contribute to inclusive sustainable growth, decent job creation and cooperation between the private sector, innovation and research entities, as well as to improved environmental sustainability."}, {"bbox": [99, 418, 1159, 658], "category": "Text", "text": "The action is fully aligned with the European Commission's top political priorities, including 1) the *European Green Deal* and 2) *An economy that works for the people*. It also resonates perfectly with EU's call to build back better from the COVID19 pandemic, by promoting green, circular, digital and inclusive economic recovery and development models. The action contributes to the partnership for sustainable growth and jobs, envisaged under the comprehensive EU Strategy for Africa. It further aligns with the 2022 EU-AU Summit Declaration, in which promoting a sustainable economy, value addition and private sector development feature prominently. The action also contributes to the Global Gateway, especially under the headings \"Accelerating the green transition\", \"Accelerating the digital transition\" and \"Accelerating sustainable growth and decent jobs' creation\" and \"Supporting sustainable financing for growth\"."}, {"bbox": [99, 669, 1159, 777], "category": "Text", "text": "Finally, the action represents a real opportunity to strategically position the EU and its enterprises and investors in Zambia in the green and digital sectors, while promoting decent job creation in a land-connected country that aspires to become a regional trade hub, which could in turn become a comparable advantage vis a vis other development partners and countries."}, {"bbox": [99, 793, 356, 824], "category": "Section-header", "text": "## 2.2 Problem Analysis"}, {"bbox": [99, 838, 1159, 947], "category": "Text", "text": "The Zambian economy has made little progress in structural transformation and diversification even compared to other countries in the region, and private sector remains dominated by MSMEs. While change in internal demand and the rapid urbanisation process represents concrete opportunities, there are still important hindrances to a solid and diversified private sector, particularly for small and medium SMEs."}, {"bbox": [99, 956, 1159, 1222], "category": "Text", "text": "MSMEs have weak access to finance and business advisory services. Commercial banks dominate the financial sector, and their lending practices continue to rely on several and multiple collaterals for security. Interest rates and other fees make the cost of borrowing high and, combined with requirements for trading records, make it difficult for MSMEs to access loans, particularly start-ups and companies in asset light industries. A number of credit schemes have been piloted to catalyse lending of commercial banks, but these have so far been largely unsuccessful in shifting bank perceptions of risk in the MSME sector. Other financial institutions start to emerge, but this subsector remains so far marginal and concentrated in Lusaka. The Business Development Service Provider (BDSP) market remains thin, expensive, with variable quality focusing mainly on businesses in the agriculture, agro processing and food manufacturing sectors and in the capital. Few BSDP provide services in green, circular and/or the digital and ICT sector. Services for internationalisation are traditional and limited."}, {"bbox": [99, 1234, 1159, 1422], "category": "Text", "text": "Women and youth are particularly disadvantaged in their transition to higher value, green, circular and digital businesses. Access to finance, training and advisory services and the lack of collateral are an even bigger hindrance for women and youth. In addition, strongly rooted traditional thinking on women's roles creates a negative attitude towards women-owned businesses and women's confidence in starting and growing a business. The youth obviously lack experience in doing business, and many do not have the right skills to access decent jobs. An outdated TVET framework and a mismatch between private sector needs and graduates' skills exacerbates this situation. In the area of green growth, the gap in relevant skills, particularly among young graduates is even more evident."}, {"bbox": [99, 1433, 1159, 1621], "category": "Text", "text": "Despite the clear positioning of the government in favour of a green economy, Zambia currently lacks a business-enabling environment and investment climate that could stimulate the green transition. Zambia has just started the process of elaborating a green growth strategy and has so far no national circular economy strategy. In addition, gaps in current policies, lack of incentives and contradictory strategic frameworks limit private sector participation in key green growth and circular economy areas, such as waste minimisation and recycling, clean and renewable energy, and regeneration of natural systems. Responsibilities are not clearly defined, existing regulations are not being enforced, capacities within regulatory agencies are reduced, and legislation is disconnected from implementation"}, {"bbox": [1051, 1666, 1158, 1690], "category": "Page-footer", "text": "Page 6 of 26"}]