Making natural resources work for inclusive growth

and sustainable development in Southern Africa

September 2014
Making natural resources work for inclusive growth
and sustainable development in Southern Africa1

September 2014

Southern Africa Office

1 Used interchangeably with the Southern African Development Community (SADC) in the report.
Table of Contents
Abbreviations and acronyms.............................................................................................................viii
Acknowledgements............................................................................................................................... xi
Executive summary...............................................................................................................................xii
Exploitation of natural resources in SADC and its challenges............................................................................................... xii
Making natural resources contribute to inclusive growth in SADC.................................................................................xvi
Conclusions...................................................................................................................................................................................................... xviii
Recommendations..........................................................................................................................................................................................xix
Chapter 1: Introduction..........................................................................................................................1
Overview.................................................................................................................................................................................................................. 1
The dimensions of inclusive growth....................................................................................................................................................... 8
Study objectives and methodology......................................................................................................................................................10
Scope of the study...........................................................................................................................................................................................10
Structure of the study....................................................................................................................................................................................11
Study limitations................................................................................................................................................................................................11
Chapter 2: Exploitation of natural resources in the SADC region................................................13
Overview................................................................................................................................................................................................................13
Land and agriculture.......................................................................................................................................................................................13
Land.........................................................................................................................................................................................................13
Agriculture.............................................................................................................................................................................................17
Challenges in the agricultural sector ........................................................................................................................................18
Mineral resources..............................................................................................................................................................................................19
Mining and inclusive growth........................................................................................................................................................23
Challenges in the mining sector..................................................................................................................................................25
Forest resources.................................................................................................................................................................................................28
Contribution made by forest resources to SADC economies...........................................................................................30
Forest-based industries....................................................................................................................................................................31
Inclusive growth components in SADC forestry policies...................................................................................................34
Challenges in the forestry sector..................................................................................................................................................35
Wildlife resources and tourism.....................................................................................................................................................36
Tourism, wildlife and SADC economies....................................................................................................................................36
Potential of tourism and wildlife to contribute to inclusive growth.............................................................................38
Existing policy components for tourism and wildlife to contribute to inclusive growth.....................................38
Challenges to inclusive growth in the tourism and wildlife sectors.............................................................................39

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 SADC water resources....................................................................................................................................................................................39
Water resources management in the SADC region ...........................................................................................................43
Contribution of water resources to SADC economies........................................................................................................44
The fisheries sector.............................................................................................................................................................................44
SADC on fisheries and the fight against IUU fishing...........................................................................................................47
Elements of inclusive growth in SADC fisheries policies and strategies......................................................................47
Challenges in the fisheries sector.................................................................................................................................................48
Renewable energy resources....................................................................................................................................................................49
Status of electricity demand and supply in the region......................................................................................................51
Initiatives to promote renewable energy in the SADC region.........................................................................................51
Challenges to the adoption of renewable energy and contribution to inclusive growth...................................52
Human capital and inclusive growth....................................................................................................................................................52
Challenges to maximising the contribution of human capital to inclusive growth.............................................56
Summary...............................................................................................................................................................................................56
Chapter 3: Making natural resources contribute to inclusive growth in SADC.........................57
Overview................................................................................................................................................................................................................57
Suggested principles of inclusive growth ........................................................................................................................................57
Facilitate access to land and inclusive growth...............................................................................................................................59
Enhance the contribution of the agricultural sector to inclusive growth.....................................................................61
Use Market-Assured Renewable Natural Resources as a Catalyst......................................................................................63
Make non-renewable mineral resources stimulate inclusive growth..............................................................................65
Enhance the exploitation of forestry resources.............................................................................................................................70
Enhance Exploitation of Wildlife and Tourism ...............................................................................................................................72
Enhance utilization of water resources...............................................................................................................................................73
Increase use of renewable energies......................................................................................................................................................76
Maximize the contribution made by human capital to inclusive growth.....................................................................79
Promoting inclusive growth..........................................................................................................................................................81
Summary................................................................................................................................................................................................................82
Chapter 4: Conclusions and Recommendations..............................................................................84
Conclusions..........................................................................................................................................................................................................84
Recommendations .........................................................................................................................................................................................85
Actions by SADC Member States.................................................................................................................................................85
Actions by RECs and development partners..........................................................................................................................89
References...............................................................................................................................................91
Annexes................................................................................................................................................ 100
List of boxes
Box 2.1: Mining investment incentives in Zambia (PMRC, 2013)...................................................................................................27
Box 2.2: SADC project on monitoring climate change adaptation to drought Agro ecological
Region I, Zambia (SADC, 2012b).....................................................................................................................................................43
Box 3.1: Integrated wildlife production and tourism development yield benefits for
conservancy communities in Namibia (Weaver and Skyer, 2004).............................................................................60
Box 3.2: Bioethanol industry expands cassava market and stabilizes cassava prices for farmers in
Thailand (Sriroth, Wanlapatit and Piyachomkwan, 2011)................................................................................................63
Box 3.3: Sudan experience suggests fuel switching is a complex issue (Khennas,
Hagen and Muok, 2013).......................................................................................................................................................................64
Box 3.4: The bamboo industry in China.........................................................................................................................................................64
Box3.5: Localization of downstream processing of diamonds in Botswana (Tshetlhane, 2013)...............................67
Box 3.6: Economic diversification: Chile diversifies economy using copper revenues
(Chilean Economic Development Agency, 2013)................................................................................................................68
Box 3.7: Economic diversification: enhancing a diversified Malaysian economy
using oil resources (Noh, 2013)........................................................................................................................................................69
Box 3.8: Measures taken by Great Lakes countries to reduce the illegal
exploitation of mineral resources (Franken and others, 2013).....................................................................................69
Box 3.9: South African experience with private protected ecotourism areas(IUCN, 2005)...........................................72
Box 3.10: Windhoek leads the way in water and energy conservation in SADC (UN-Water, 2014)..........................73
Box 3.11: Resolving conflict between small-scale and commercial fish farmers in
Zambia (WorldFish, 2014). ...............................................................................................................................................................74
Box 3.12: Andavadoaka community-run, self-sustaining, marine-protected area in Madagascar...................... 74
Box 3.13: Regional actions to reduce IUU fishing in SADC marine waters..............................................................................75
Box 3.14: Sierra Leone develops Africa’s largest sugarcane plantation for bioethanol (AfDB, 2013b)....................78
Box 3.15: Global examples of Moringa promotion.................................................................................................................................81
Box 3.16: Towards green growth in Burkina Faso and Niger (AfDB, 2014) ..............................................................................82

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List of figures
Figure 1.1 GDP growth rates (2009– 2013).................................................................................................................................................... 2
Figure 1.2: SADC real GDP growth rates (percentage)........................................................................................................................... 3
Figure 1.3: Real GDP growth in Africa (2008 – 2012)............................................................................................................................... 3
Figure 1.4: GDP growth outlook for Southern Africa............................................................................................................................... 4
Figure 2.1: Contribution of mining industry to SADC GDP...............................................................................................................20
Figure 2.2: Comparison between national wealth and inequality in the SADC region...................................................24
Figure 2.3: Annual rate of deforestation in SADC countries (2005–2010)................................................................................36
Figure 2.4: Ranges of levelized cost of SADC site-specific projects by type of technology..........................................50
Figure 2.5: Life expectancy compared to poverty, health expenditure and adult obesity............................................54
Figure 2.6: Life expectancy compared to obesity and health expenditure ...........................................................................55
Figure 2.7: Global economic costs of chronic diseases........................................................................................................................55
Figure 3.1: Schematic illustration of the relationship between resources and inputs and outputs........................58
Figure 3.2: Growth elasticity of poverty by agricultural and non-agricultural subsector in
four selected SADC countries.....................................................................................................................................................68
Figure 3.3: Transparency in Sierra Leone’s government revenues................................................................................................70
List of tables
Table 1.3: Capital flight from SADC and external debt up to 2010................................................................................................. 8
Table 2.1: Major land uses in the SADC region ........................................................................................................................................16
Table 2.2: Revenue from the mining sector in the SADC region (2010 - 2012)....................................................................21
Table 2.3: SADC minerals and their main export destinations........................................................................................................22
Table 2.4: Estimated number of artisanal and small-scale miners in selected SADC Member States....................23
Table 2.5: Countries performing well across the six areas of the resources value chain.................................................25
Table 2.6: Forest cover in the SADC region..................................................................................................................................................29
Table 2.7: Industrial wood production and consumption in SADC.............................................................................................31
Table 2.8: Energy types and end-uses in SADC households.............................................................................................................32
Table 2.9: Forest cover and wood harvest and value in SADC region for IRW and wood fuel (2005).....................32
Table 2.10: Charcoal demand and actors in the charcoal industry in selected SADC cities.........................................33
Table 2.11: Employment in the SADC charcoal industry....................................................................................................................33
Table 2.12: Tourism receipts and jobs in SADC.........................................................................................................................................37
Table 2.13: Contribution of the SADC tourism industry to regional GDPs compared to Africa and
the rest of the world.........................................................................................................................................................................38
Table 2.14: Water resources in SADC...............................................................................................................................................................40
Table 2.15: A summary of comparative water storage and abstraction....................................................................................41
Table 2.16: Water sector vision 2027 target.................................................................................................................................................41
Table 2.17: GDP contribution and employment by the fisheries industry in selected SADC .....................................45
Table 2.18: Top 10 aquaculture producers in Africa in 2010 and 2012.......................................................................................46
Table 2.19: Inland water capture........................................................................................................................................................................46
Table 2.20: Existing and identified hydropower generation in SADC.........................................................................................50
Table 2.21: SADC development and health indicators.........................................................................................................................53
Table 3.1: Examples of management measures for sustainable forestry by SADC Member States.........................70
Table 3.2: RESAP targets (percentage) for least cost options...........................................................................................................77

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Abbreviations and acronyms
ACP African, Caribbean and Pacific Group of States
AECOM African Economic Community
AER Agroecological Region
AfDB African Development Bank
AFLEG African Forest Law Enforcement and Governance
APRM African Peer Review Mechanism
AsDB Asian Development Bank
ASM Artisanal Small-scale Mining
BEE Black Economic Empowerment
BoP Bottom of Pyramid
BOT Build-Operate-Transfer
CAADP Comprehensive Africa Agricultural Development Programme
CBNRM Community-Based Natural Resource Management
CMN Chamber of Mines of Namibia
CMSA Chamber of Mines of South Africa
CMZi Chamber of Mines of Zimbabwe
CPI Corruption Perceptions Index
DAFF Department of Agriculture, Forestry and Fisheries
DFRC SADC Development Finance Resource Centre
DMR Department of Mineral Resources
EAC East African Community
ECA Economic Commission for Africa
ECA SRO-SA ECA Subregional Office for Southern Africa
ECOWAS Economic Community of West African States
EEZ Exclusive Economic Zone
EU European Union
EXCO Executive Committee
FAO Food and Agricultural Organization
FAOFAD FAO Fisheries and Aquaculture Department
FANR SADC Food, Agriculture and Natural Resources (Directorate)
FDI Foreign Direct Investment
FIAS Foreign Investment Advisory Service
GC Gini Coefficient
GDP Gross Domestic Product
GFCF Gross Fixed Capital Formation
GRSA Government of the Republic of South Africa
GVC Global Value Chain
HDI Human Development Index
HDI (IHDI) (Inequality-adjusted) Human Development Index
HDSA Historically Disadvantaged South Africans

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IBRD International Bank for Reconstruction and Development
IMF International Monetary Fund
INBAR International Network for Bamboo and Rattan
IOTC Indian Ocean Tuna Commission
IPOA-IUU International Plan of Action to Prevent, Deter and Eliminate Illegal, Unreported
and Unregulated Fishing
IRD Industrial Round Wood
IRENA International Renewable Energy Agency
IRW Industrial Roundwood
ISS Institute for Security Studies
IUCN International Union for Conservation of Nature
IUUF Illegal, Unreported and Unregulated Fishing
IWRM Integrated Water Resources Management
LED Light-Emitting Diode
MCS Monitoring, Control and Surveillance
MNC Multinational Corporation
MW Megawatts
MET Ministry of Environment and Tourism (of Namibia)
NBASA National Bamboo Association of South Africa
NEPAD New Partnership for African Development
NEPRU Namibian Economic Policy Research Unit
NPOA National Plan of Action
NUM National Union of Mineworkers
NWFP Non-Wood Forest Products
NWR Namibian Wildlife Resorts
OECD Organisation for Economic Cooperation and Development
OSISA Open Society Initiative of Southern Africa
PDL Poverty Datum Line
PGMs Platinum Group Metals
PMRC Policy Monitoring and Research Centre Zambia
PPP Public-Private Partnership
PV Photovoltaic
PROMINP Oil and Gas Brazilian Industry Mobilization Program
RDD&D Research, Development, Demonstration and Deployment
RECs Regional Economic Communities
RESAP Renewable Energy Strategy and Action Plan
RISDP Regional Indicative Strategic Development Plan
RFMO Regional Fisheries Management Organization
RSA Republic of South Africa
R&D Research and Development
SACAU Southern African Confederation of African Unions
SADC Southern African Development Community

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SAPP Southern African Power Pool
SIF Stop Illegal Fishing
SME Small and Medium-Sized Enterprise
SARW Southern African Resource Watch
SOEs State-Owned Enterprises
SSA Sub-Saharan Africa
SSY SciSys
STA SADC Timber Association
TIPS Trade and Industrial Policy Strategies
TNC Transnational Corporation
TNRC Tanzania Natural Resource Centre
TNRF Tanzania Natural Resource Forum
TFCA Transfrontier Conservation Area
TWh Terrawatt Hour
UNCTAD United Nations Conference on Trade and Development
UNDESA United Nations Department of Economic and Social Affairs
UNIDO United Nations Industrial Development Organization
UNODC United Nations Office on Drugs and Crime
UNDP United Nations Development Programme
UNEP United Nations Environment Programme
VMS Vessel Monitoring System
WAHSA Work and Health in Southern Africa
WMAs Wildlife Management Areas
WTO World Trade Organization
WTTC World Travel and Tourism Council
WWF World Wildlife Fund
ZAWA Zambia Wildlife Authority
ZCCM Zambia Consolidated Copper Mines
ZEPARU Zimbabwe Economic Policy Analysis and Research Unit
ZRA Zambezi River Authority

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Acknowledgements
Oliver Maponga supervised this study and compiled the report from a draft prepared by Professor
Thomson Sinkala of Thomro Investments, Lusaka, Zambia. The study was undertaken under the guid-
ance of Mr. Sizo Mhlanga, Chief of the Subregional Data Centre, Economic Commission for Africa
(ECA) Office for Southern Africa, and the overall leadership of Mr. Said Adejumobi, Director of the
ECA Office for Southern Africa. Colleagues from the ECA Office in Southern Africa –Anthony Taylor,
Mzwanele Mfunwa, Jean Luc Mastaki Nemagabe, Maame Agyeben, Ian Fialkati and Henry Lubinda
– provided valuable input and support during the compilation of this study. The report benefited
immensely from both the comments made by experts who participated in a meeting held in Living-
stone, Zambia on 13 and 14 March 2014 and the proposals provided by delegates to the Twentieth
Session of the Intergovernmental Committee of Experts of Southern Africa held also in Livingstone
on 15 and 16 March 2014.

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Executive summary
The Southern African Development Community (SADC) region is endowed with vast quantities of
natural resources including land, water, forestry, fisheries and minerals. Many of these resources exist
in world-class quantities. Consequently, natural resources are at the centre of regional economic
activities. For example, the estimated total SADC GDP generated from the exploitation of natural re-
sources, their products, and various services in the region amounted to US$629 billion in 2012 (Bank
of Botswana, 2013, SciSys (SSY), 2012). The exploitation of these natural resources has been at the
heart of high regional growth in recent years. Regional GDP is expected to grow by around 4 per cent
in 2013 and to accelerate to 4.6 per cent in 2014 due to buoyant commodity prices (Bank of Botswa-
na, 2013; SSY, 2012). However, this high growth rate has failed to address socioeconomic challenges
in most SADC countries as indicated by the levels of socioeconomic indicators. For example, regional
unemployment levels at 26 per cent remain high in booming economies, undernourishment for
the period from 2010 to 2012 stood at 26.7 per cent, maternal mortality in 2010 was high at 382 for
every 100,000 in SADC, the human development index was 0.447in 2012 (African Development Bank
(AfDB), 2013a), and access to electricity in Southern Africa is 24 per cent (International Renewable
Energy Agency (IRENA), 2014). There is a huge disparity between what the exploitation of available
natural resources in the region can potentially contribute and what these natural resources are actu-
ally contributing towards addressing development challenges. Inclusive growth and the attainment
of developmental goals such as job creation, food security, and effective and efficient social services
delivery have remained elusive for most countries in the region owing to various factors including
poorly designed policy frameworks and failure to capture adequate revenues from the exploitation
of resources. Strategies to ensure that resource-based growth trickles down to regional citizens and
addresses developmental challenges need to be introduced.

This report presents the findings of a study to consider how best the region can make natural re-
sources work for inclusive growth and sustainable development. It proffers national and regional
level recommendations to accelerate progress towards inclusive growth and development. The ECA
Subregional Office for Southern Africa (SRO-SA) commissioned this study, with the overall aim of
ascertaining how SADC Member States can utilize the benefits of natural resources exploitation to
promote inclusive growth. The report defines inclusive growth as growth where all people in a given
geographical area are equitably facilitated with conditions and opportunities to actively, efficiently
and responsibly apply their abilities during their functional lifetime to utilize natural resources for
their livelihoods and enjoy benefits from these resources throughout their lifetime without undue
internally induced hindrance on sustainable basis. This definition provides the boundary parameters
for the analysis and the overall evaluation presented herein.

Exploitation of natural resources in SADC and its challenges

Land and agriculture: Land is both directly and indirectly the main focus of development, as access
to land and the manner in which it is managed are both key to promoting inclusive growth. SADC
Member States face different challenges in terms of access to land owing to differing land tenure
systems and ownership histories (Southern African Confederation of Agricultural Unions (SACAU),
2010; Mgugu, 2005).The main challenges in land access include: the lack of rural infrastructure which
makes land unattractive for investment and for use as collateral in accessing loans; the non-existence
of land markets in rural areas; the bureaucratic processes for acquiring titled land; the gender imbal-
ance in accessing land; land-use conflicts and weak land administrations in processing land. These
challenges hamper the exploitation of land’s effective contribution to inclusive growth.

xii
Agriculture is one of the primary uses of land in the whole SADC region and is central to poverty
reduction, inclusive growth, and food and nutrition security. The agriculture sector in the region pro-
vides livelihoods and subsistence, employment, income, and creates wealth. The SADC region pos-
sesses 964.63 million hectares of land, of which 23.4 per cent is arable and is a resource that can be
exploited for socioeconomic benefits. In 2012, for example, the agricultural sector contributed 8 per
cent to regional GDP, and an estimated 82.8 million people or 66 per cent of the regional labour force
were employed in this sector.1 The region’s agricultural sector registered positive annual growth of
2.6 per cent against population growth of 2.5 per cent during the previous decade. This agricultural
growth rate is however inadequate when compared with the regional potential (SADC Food, Agricul-
ture and National Resources (FANR), 2013)

The agricultural sector also faces many challenges which impact on land use and productivity includ-
ing: low domestic value addition along the value chain; poorly organised smallholder farmers; limited
access to secure land for smallholder farmers, poor rural infrastructure for marketing produce and for
transporting inputs; large post-harvest losses by smallholder farmers owing to poor infrastructure,
limited access to markets; limited support for informal cross-border trade in the region; poor devel-
opment of irrigation systems; and the lack of financial support for smallholder farmers.

Mineral resources: The SADC region produces various minerals including copper, chromium, co-
balt, diamonds, coal, hydrocarbons, gold and platinum group metals (PGMs), coloured stones at var-
ious scales from artisanal to large scale. Mineral exploitation is important for revenues, employment,
skills development, and industrialization. Overall, the contribution by the mining industry to regional
GDP has been rising since 2000 and was estimated at about 16 per cent in 2012 (SSY, 2012). However,
the importance of mining varies across countries in the region. In 2012, for example, the contribution
made by large-scale mining to total employment was about 13,000 jobs2 in Botswana, 7,898 jobs in
Namibia (Chamber of Mines of Namibia (CMN), 2012), some 1,365,892 jobs in South Africa (Chamber
of Mines of South Africa (CMSA), 2013), around 300,000 jobs in Zambia and approximately 45,000
jobs in Zimbabwe (Zimbabwe Economic Policy Analysis and Research Unit (ZEPARU), 2012). In addi-
tion, over 3.2 million people – mainly women and the youth in SADC Member States – are engaged
in artisanal mining, with the latter both directly and indirectly supporting a further 16 million or so
people (Buxton, 2013; Jerie, 2013).

Among the major causes of the failure of the large-scale minerals sector to contribute to inclusive
growth is the low domestic processing of mineral products, the fact that low value addition means
low linkages and low multipliers, poorly designed and inefficient fiscal frameworks, inefficient mining
methods, transfer pricing, and limited participation of locals along the mineral value chain. For small-
scale mining, the challenges include hazardous working conditions, child labour, the lack of prospec-
tive exploration and mining ground, poor mining and processing methods, high levels of diseases,
limited skills and inadequate marketing methods.

Forest resources: Forests contribute towards the basic needs of communities and individuals in
the form of fuel, animal fodder, and resources for shelter and housing construction, timber for furni-
ture, curios and agricultural tools. In addition, there are non-wood forest products such as medicinal
plants, indigenous fruits, edible plants, edible insects, honey, beeswax, exudates and mushrooms
derived from forest resources. For example, exotic forest plantation contributed 1.8 per cent to GDP
and employed about 110,000 people in South Africa (Swedish Trade Council, 2011) while the forestry
sector employed 14,500 people and contributed 3 per cent to GDP in Zimbabwe, contributed 25
per cent of foreign exchange earnings in Swaziland (Jasparo, 2009) and contributed US$25 million
1 www.cia.gov
2 http://www.mbendi.com/indy/ming/af/bo/p0005.htm.

xiii
to GDP in Mauritius and US$9 million in the United Republic of Tanzania (Food and Agriculture Or-
ganization (FAO), 2010a). The SADC region exported US$33.149 million of wood charcoal in 2010, of
which South Africa accounted for 57 per cent. Charcoal intra-SADC trade amounted to US$699,000,
of which Malawi was responsible for 80 per cent (FAO, 2010a).

This sector also faces many challenges including: weak institutional frameworks to support the coor-
dination and implementation of national forestry policies; poor implementation and enforcement of
policies and legislation; outdated forestry inventory data for effective planning; competing land uses
leading to the loss of forests; conflicting and unclear land tenure systems; inadequate infrastructure
to support forest industry; limited financial resources for commercial activities in the sector; illegal
wood harvesting and uncontrolled charcoal production and corruption; limited skills to convert for-
est resources into high value products. Furthermore, the value addition along the forestry value chain
also limits the ability of communities to benefit from this sector.

Wildlife resources and tourism: Wildlife and tourism are a crucial source of employment, foreign
exchange earnings and revenues. The wide range of the region’s unique features of wildlife, cul-
ture, landscapes, water and other attractive natural resources if well utilized have a large potential
to contribute to inclusive growth. For example, World Bank data showed that tourism generated an
average of US$15.35 billion between 2006 and 2010, and both direct and indirect jobs created in
the tourism industry in 2011 exceeded 5.7 million. Data from the World Travel and Tourism Council
(WTTC) reveals that tourism-based revenue contributions to GDP were significant in 2011 for some
countries, amounting to 61 per cent for Seychelles and 29 per cent for Mauritius. Furthermore, of the
US$163.9 billion generated by the tourism industry in Africa in 2011, the SADC region accounted for
36 per cent (WTTC, 2012). At the global level, however, this figure represented just 1 per cent. There
is therefore potential for the sector to play an even greater role in advancing the economic activities
of the SADC region based purely on its vast natural resources and tourist attractions.

The challenges hindering the effective contribution of this sector to inclusive growth include: inad-
equate information or publicity about wildlife conservation projects and programmes; poor skills for
communities to meaningfully participate in wildlife conservation projects; unsatisfactory marketing
skills by local tourism agents; inadequate resources to develop projects to commercial levels; limited
participation and consultation in developing tourism and conservation projects. Furthermore, the
policy frameworks for the sector favour extraction with limited domestic value addition.

Water resources: Water resources hold great potential to contribute to inclusive growth in SADC
through fish harvesting, agriculture, water sports and cruises, transport, power generation and pota-
ble water industry and irrigation. The SADC region hosts about 21.6 million hectares of both inland
and marine water resources, and these water bodies sustain a rich diversity of natural ecosystems
and are critical for meeting the basic needs including domestic and industrial requirements. Im-
proving access and availability of energy through hydropower and provision of employment are
major benefits from access to water. Shared watercourses, such as the Zambezi River Basin and the
Congo Basin, generate regional economic benefits to the region. For example, the Zambezi Basin
has eight regional member states and provides a source of livelihood along the course of the river.
An estimated total of 2,300 km3/year of renewable water resources is available to the SADC region’s
population of 291 million people. The current level of abstraction is only 44 km3/year or 170 m3/cap-
ita/year (SADC, 2012b). Of the 44 km3/year abstracted, 77 per cent is used for irrigation, 18 per cent
for domestic purposes while 5 per cent is used by industry. If the storage of the Kariba and Cahora
Bassa dams is excluded, only 4 per cent of the total annual renewable water resources in the SADC
region are currently stored for various uses, which is very low compared to 70–90 per cent in most
industrialized countries. According to SADC (2012), if the storage of Kariba and Cahora Bassa dams is

xiv
included, 14 percent of the total annual renewable water resources in the region is currently stored
for various uses.

The water sector’s challenges for meaningful contribution to inclusive growth include: inefficient wa-
ter use; low water productivity especially in agriculture; increasing water scarcity and the associated
difficulty of allocating water among competing uses and users; poor planning for multiple uses of
water; low access to safe drinking water especially among the poor residing in rural and peri-urban
areas; low investment in water infrastructure, high water losses, and deteriorating water quality. For
the fisheries sector, the challenges include conflicts between the artisanal and industrial fishing in-
dustries; conflicts in fish harvesting in shared watercourses; poor fisheries management and limited
value addition to fish products.

Renewable energy resources: The SADC region possesses vast quantities of natural renewable
and non-renewable resources that could be harnessed for clean energy. These include wind at high
speed levels (as high as 9m/s onshore) that can be used for electricity generation, with a potential
for as much as 800 TWh/year; solar with insolation levels (5.5 to 7 kWh/m2 per day) that can be used
for electricity generation, with potential for as much as 20,000 TWh/year; several waterfalls and cata-
racts for hydropower generation with a potential of 660 TWh/year; vast coal resources in Botswana,
Mozambique, South Africa and Zimbabwe with potential for close to 17,700 megawatts (MW); and
also hydrocarbons and geothermal resources (SADC 2012a,; IRENA, 2013 and 2014). Other sources
of renewable energy include: wave energy; tidal range; tidal currents; ocean currents; ocean thermal
energy; salinity gradients and biomass. The region currently derives electricity from many sources
including hydropower, coal, nuclear, natural gas and the distillate/diesel-based power generation.
The energy mix is currently dominated by coal, which accounted for 74.3 per cent of the energy mix
in2010 while hydropower accounted for 20.1 per cent, nuclear power for 4 percent and diesel for 1
per cent (SADC, 2012a).The renewables sector is still undeveloped in most countries of the region
despite the existing potential and the high demand for clean energy. That said, access to modern
forms of energy is important for the region’s socioeconomic development.

Among the several planning and implementation challenges hindering the exploitation of renew-
able energy resources in the region include: poor capacities at both national and regional levels to
accelerate the penetration of renewable energies, the absence of renewable energy micro-grids for
domestic use; weak policy frameworks emphasizing renewable energy as part of the energy mix; the
cost of renewable energy investment and the lack of finance to invest in this sector.

Human capital: The huge population of the SADC region is a resource with immense potential to
facilitate progression up the product value chain through efficiency and innovation. This requires
investment in human development. Apart from improving overall productivity, a skilled workforce
expands the tax base and reduces the social and economic costs of poverty. However, investment in
education in the SADC region is low, accounting for 1.3 per cent of GDP in 2011 in Zambia, with Leso-
tho out in front at 13 per cent (AfDB, 2013a). Furthermore, the present regional mean years of school-
ing of 6 years against the expected average of 11 years is rather low by any standards. In addition to
skills, access to health is also important for the efficient contribution of human resources to inclusive
growth. Furthermore, life expectancy of 56 years in the SADC region remains lower than the world av-
erage of 80 years (Fahey and Kensler, 2013; United Nations Development Programme (UNDP), 2013).

The challenges to the effective contribution by human capital to inclusive growth include: inade-
quate investment in education and skills development; irrelevant curriculum; inadequate investment
in developing local solutions to local challenges; failure to domesticate and adapt relevant interna-

xv
tional experiences; short life spans and health spans in the SADC region owing to poor health facili-
ties and poor remuneration to expertise leading to a brain drain.

Making natural resources contribute to inclusive growth in SADC

Natural resources – dependent (-based) inclusive growth is founded upon broad-based growth
across all sectors of an economy and has a productive distributional aspect that aims to reduce in-
come inequality in society while ensuring the sustainable exploitation of the resources. In proposing
measures to improve inclusive growth in the SADC region, the study suggests an approach which
is based on; (i) assessing options for exploiting natural resources in a specific area that offer the best
output for the benefit of locals, (ii) identifying and promoting natural resource-based industries’ pri-
ority for resources with sustainable markets, (iii) prioritizing locals throughout the value chain(iv) re-
taining maximum possible value from exploited natural resources within the local economy, and (v)
ensuring maximum and environmentally-friendly productivity by human capital within that locality.

Land and agriculture resources: For land and agricultural development, improved access to se-
cure land is critical to facilitate its utilization for productive purposes. Land policies that consider the
various economic uses of land are important for the optimal use of the resource. Equally import-
ant are measures designed to ameliorate land use such as improving land tenure and administra-
tion; opening up opportunities to access capital; promoting land markets; investing in rural access
infrastructure; promoting integrated land management and use; addressing gender imbalance in
land ownership; and prioritizing local investment in land access should be implemented. In addi-
tion, boosting investment in the agricultural sector; facilitating access to secure land especially by
small-scale farmers and women who are currently disadvantaged; enhancing farm-input support
systems; reducing post-harvest losses; improving access to affordable finance and credit; increasing
the availability of water, addressing the prevalence of diseases; minimizing land disputes and con-
flicts; strengthening skills and investing in research, development and demonstration can all result in
increased productivity and hence deepen contribution to inclusive growth. Furthermore, developing
assured markets for agricultural products; promoting small and medium-sized enterprise (SME) ser-
vices in the agricultural sector; developing drought-tolerant crops varieties; and promoting farmer
support organizations will strengthen the role of the agricultural sector as the main pillar of inclusive
growth in the SADC region.

Renewable natural resources: A renewable natural resource-based inclusive industry where

the SADC region has local value chains and predictable local markets and therefore an inherent
shield and resilience against external shocks should be considered a priority programme targeted
at strengthening inclusive growth in resources exploitation. Renewable resources have extensive
backward-forward linkages, give rise to multiple co-products, and would result in eco-cities and thus
further deepen the role of the sector. As a result, incomes can be stabilized and meaningful participa-
tion in inclusive growth-inducing programmes is ensured. For example, if the SADC region replaced
petroleum transport fuels with biofuels, there would be an assured annual economy of about US$25
billion per year of bioethanol, US$39 billion per year of biodiesel, US$3.9 billion per year of electricity,
US$89 billion per year of soybean meal, and US$366 billion for housing, and would employ about 6.1
million people. Another example is the use of bamboo-based charcoal to replace wood and charcoal
fuel from natural forests, which would generate an economy of US$3.4 billion per year and employ
2.6 million people.

The renewable energy sources in the SADC region present opportunities for renewable energy
-based inclusive growth. To increase the penetration of renewable energies for improved access to
modern forms of energy and therefore increased contribution to inclusive growth, measures include
xvi
introducing mandatory renewable energy requirements (e.g. biofuels blending ratios, feed-in-tariffs)
to create ready markets; redefining the weight of the Southern African Power Pool (SAPP) mandate
on renewable energies; promoting highly participatory biomass-based power generation; develop-
ing conducive renewable energy policies; investing in mega and micro-renewable energy infrastruc-
ture, promoting public-private partnerships (PPPs) in decentralized power systems and improving
access to finance. Consequently, the role of this sector in providing clean energy for productive and
consumptive purposes will be enhanced.

Access to clean and sustainable energy is important for the region’s socioeconomic development.
To enhance the contribution made by renewable energies to inclusive growth, measures such as the
creation of supportive policies, developing mega and micro-renewable energy infrastructure, popu-
larizing decentralized power systems, improving access to finance, and creating renewable markets
should be introduced.

Mineral resources: To enhance the contribution of mineral resources to inclusive growth, the SADC
region should invest in the promotion of local value addition and the development of local linkages;
develop fiscal frameworks that optimize revenues from mining and invest both in revenues activi-
ties that support inclusive growth and in sovereign wealth funds; promote economic diversification;
strengthen policies around the exploitation of minerals, and improve auditing along the mineral
value chain and curb tax evasion by mining companies through monitoring transfer pricing. The pro-
vision of technical and financial support to the small-scale mining sector will improve productivity
and incomes and thus deepen the contribution of this sector to inclusive growth.

Forestry resources: For forestry resources, policies that secure access to land; reforestation pro-
grammes using economic plant species; investing in skills to curb wastage and the export of raw
wood; promotion of value addition and skills development in harnessing natural forest products
such as honey, fruit, caterpillars and mushrooms.

Wildlife and tourism resources: The SADC region can extract economic benefits along the val-
ue chain of the sector by improving the policy framework for accessing the resources. In addition,
improving services including frontier handling of applications (visas and other entry permits); en-
hancing the skills of local tour operators and travel agents; networking with both international and
local air transport and airport services; providing conducive and competitive accommodation ser-
vices (hotels, lodges, camp sites, etc.); and improving other ancillary services will enhance the over-
all attractiveness of tourist resources. Furthermore, policy inadequacies for managing transfrontier
conservation areas should also be addressed and issues such as reducing cross-border power im-
balances, strengthening institutional frameworks to support the coordination and implementation
of industry programmes, and strengthening the capacities for implementing and enforcing policies
and legislation should be dealt with. This sector also requires improvement in developing infrastruc-
ture in tourism areas, minimising conflicts within and across communities, enhancing transparency
when determining dividends among stakeholders, improving access to financing opportunities for
rural communities and disadvantaged groups, and improving the sharing of information on good
practices.

Water resources: The SADC region’s various river-basin and other water management institutions
should be well resourced and their capacities improved to ensure the efficient management of this
critical resource and information on best practices in water management and conservation shared
across the region. Furthermore, the region should accelerate progress towards meeting the 2027
water targets for various uses, as this will improve access to potable water. Skills in the SADC region
on integrated water use and management will need to be enhanced to create a diversity of jobs and

xvii
incomes. The integration of aquaculture into farmers’ primary agricultural activities and products to
diversify farmer incomes will increase farmers’ incomes. The building of dams will help to manage
water resources for use in agriculture and for power, thereby improving access to modern energy.
Challenges related to access to fish resources including conflicts between large scale and small scale
need to be managed. Furthermore, the ecosystem needs to be preserved and local communities
should be part of the conservation efforts. Investment in low-cost and small-scale options in water
harvesting small rural communities could help support agricultural activities.

Human capital: Boosting productivity and innovation, and therefore growth, in the SADC region is
closely linked to Principle 4, “Maximise human resource contribution to inclusive growth”. A funda-
mental goal of economic development in the region must be to create the most productive, efficient,
sustainable and high-growth economy possible. However, poor lifespans and healthspans militate
against the attainment of such developmental goals. The measures to achieve longer lifespans and
healthspans in the SADC region should aim at attaining better health for the people, not merely more
treatment3. Health care should focus more on early health and less on late disease, with a greater
focus on prevention to achieve that goal, and this strategy must be carried out in all socioeconomic
spheres in the region: at workplaces, schools and homes. The region should combine prevention,
innovation and technology to improve long-term health. Green-based healthspan is particularly im-
portant since it is frugal, realistic, and economically sustainable in underserved and economically
deprived populations of SADC, which will become the major targets of chronic illness in the fore-
seeable future. The use of a food-centred approach to extending lifespans and healthspans can be
sustainably applied in underserved poor populations and the personalized medicine of the region.

Inclusive growth and environmental resources: The exploitation of the different natural resourc-
es is directly and indirectly associated with environmental degradation, albeit to various degrees.
Therefore sustainability issues need to be embedded in the SADC inclusive growth agenda for both
inter and intra-generational equity. To promote green inclusive growth, the SADC region will need to
adopt and implement climate-smart and sustainable agriculture, sustainable land and water man-
agement, use of renewable energy and improved energy efficiency, fuel-efficiency and less polluting
public transportation, and the maintenance of ecosystems and biodiversity protection in the region’s
development agenda.

Conclusions
The exploitation of the region’s vast natural resources has the potential to contribute to inclusive
growth and address the subregion’s development challenges if underpinned by good institutions
and good governance, appropriate infrastructure, supportive fiscal policy frameworks and strong
business competitiveness. Furthermore, the well-directed deployment of the resource sector rev-
enues into broad-based development programmes with full participation of citizens will enhance
inclusive growth. A well-managed regional natural resources exploitation strategy represents a real
opportunity to expand the regional economy and tackle poverty, and the benefits of the current
strong economic growth patterns should be harnessed to provide the basis for deepening inclusive
growth.

Land is an important asset and forms a base for accessing and/or working out other natural resourc-
es. Equitable access for all is cardinal for inclusive growth development in the region. Minerals are
wasting assets but they can spur other forms of sustainable capital including, among others, highly
skilled human capital, employment, local infrastructure development, and backward and forward
linkages to other sectors. Forestry, wildlife, agriculture, water and the renewable energies industry
3 www.aspeninstitute.org.

xviii
all offer a myriad of opportunities for addressing development challenges. Industry based on these
natural resources should therefore not be wasteful but take a long-term view to ensure sustainability
of the resource on which inclusive growth should be firmly grounded.

The development of a cluster industry based on natural resources is crucial for SADC people to bene-
fit from increased economies of scale, more organised support services and attract investment (Ram-
sawak, 2010). The huge infrastructure deficit in the region requires collaboration among stakeholders.
PPPs are a potent strategy to accelerate infrastructure development to facilitate industrial take-off in
the region. Well-developed national and cross-border infrastructure is necessary to stimulate a vi-
brant natural resources-based industry in the SADC region. The harmonization of regional standards
and the competitive quality of regional products and services will accelerate the growth of the natu-
ral resources-based industry in the region. One of the key ingredients for pursuing inclusive growth is
upgrading human skills. Appropriate knowledge and skills are important to efficiently convert natural
resources into products and services for developmental use including utilization by society.. Human
skills development should thus be embedded in any inclusive growth strategy, as skills improve the
conversion and utilization of the resources.

Recommendations
To promote inclusive growth in the region, SADC Member States need to invest in stabilizing both in-
dividual and household economies by prioritizing natural resource-based industries with predictable
markets and earnings as a catalyst for the growth and development of the region in order to cushion
citizens from the impacts of cyclical commodity prices. Furthermore, Member States should intro-
duce efficient fiscal frameworks that can optimize revenues from the mineral resources sector and
should deploy these revenues towards skills and infrastructure development and economic diversi-
fication, the development of value addition industries and investment into research, development
and innovation to support industrialization. They should also introduce tax systems that are able to
capture windfall gains in the resources sector and should create sovereign wealth funds. The acceler-
ated implementation of the SADC Regional Infrastructure Development Master Plan will address one
of the major constraints to economic diversification and the exploitation of regional value chains, in-
frastructure. For the agricultural sector, addressing land access and accelerating the implementation
of commitments under the Comprehensive Africa Agricultural Development Programme (CAADP)
will improve productivity and hence raise income levels.

The SADC Secretariat should, among other interventions, accelerate efforts towards the harmoni-
zation of national policies and strategies in exploiting various natural resources; promoting regional
value chains in various commodity sectors that can help address the constraints of smaller domestic
markets; enabling Member States to benefit from economies of scale; formulating and implementing
policies on value addition in all natural resources, accelerating progress towards achieving deeper re-
gional integration, and strengthening the role of the African Peer Review Mechanism (APRM) to mon-
itor the national and regional performance of institutions and governance in the region. Strengthen-
ing both national and regional mechanisms for the full participation of citizens in exploiting natural
resources will contribute to wealth creation and hence to raising standards of living.

The role of development partners in providing technical support for capacity development in SADC
Member States and in facilitating inter-regional information sharing on best practices in natural re-
sources exploitation and the management of resources revenues cannot be under-estimated in
strategies designed to enhance inclusivity in the exploitation of natural resources. Furthermore, de-
velopment partners can provide support at both national and regional level in domesticating rele-
vant international agreements that impact on natural resources exploitation and inclusive growth.
xix
Chapter 1: Introduction
Overview
Natural resources such as land, minerals, water and trees are critical to all aspects of human well-be-
ing, and access to these resources is at the core of life-enhancing opportunities and choices for
citizens. The 15 Member States of the Southern African Development Community (SADC) are richly
endowed with natural resources, a number of which are in world-class quantities. The region has a
land area of about 964.63 million hectares, of which 23.4per cent is arable. It possesses 394 million
hectares of forestry, 21.6 million hectares of inland and marine water resources and a variety of in-
dustrial, precious, metallic and hydrocarbon minerals. In addition, the region is endowed with high
levels of wind speeds, as high as 9m/s onshore and high solar insolation levels averaging between 5.5
to 7 kWh/m2 per day (IRENA, 2014). Furthermore, the region’s diverse wildlife and tourism resources
remain untapped.

The exploitation of these resources has been the key driver of economic development in the region.
For example, agriculture currently accounts for 8 per cent of the regional gross domestic product
(GDP) and 66 per cent of employment (SSY, 2012). The minerals sector directly contributes about 10
per cent to regional GDP, 7 per cent to employment and 35 per cent to export earnings (SSY, 2012).
However, the sectoral contributions vary significantly at country level. For example copper alone ac-
counts for about 80 per cent of Zambia’s export earnings, 18 per cent of employment and 8 per cent
of government revenues (UKAid and World Bank, 2011). For Namibia, the minerals sector accounts for
11.5 per cent of GDP and provides about 8,000 direct jobs (CMN, 2012). In the case of Malawi, agricul-
ture contributes 37 per cent to GDP and 82.5 per cent to export earnings (AfDB, 2013c). Furthermore,
the fisheries sector accounts for 4 per cent of Malawi’s GDP (Phiri, Matiya and Hara, 2010).

Economic development patterns in SADC Member States during the last decade have further demon-
strated the importance of natural resources exploitation in overall economic recovery. The economic
performance in the region has largely mirrored developments in the global economy during 2012,
as shown in Figure 1.1. The slowdown in economic growth registered in 2012 was attributable to the
slow and fragile recovery of the global economy, particularly the weakness in advanced economies,
which has adversely affected global demand (Bank of Botswana, 2013). Since most SADC economies
are export-dependent for revenues, the reduction in global demand and trade impacted negatively
on growth. Although the general economic performance of SADC countries was subdued, 14 report-
ing countries recorded positive growth rates.

1
Figure 1.1 GDP growth rates (2009– 2013)

Source: Bank of Botswana, 2013.

The average economic growth in the region decelerated from 5.3 per cent in 2011 to 4.6 per cent in
2012 (Bank of Botswana, 2013; SSY, 2012). However, with the exception of South Africa and Zimba-
bwe, notable expansions in GDP were registered in the mineral resource-rich countries of Angola, the
Democratic Republic of the Congo, Mozambique and Zambia all of which surpassed the 7 per cent
growth rate target for Millennium Development Goals. The United Republic of Tanzania registered
a growth rate of 6.9per cent (Figure 1.2). Although economic performance was generally subdued
in the other SADC countries, they nevertheless registered positive growth rates. Namibian econom-
ic growth was 5.0 per cent in 2012 down from 5.7 per cent in 2011. Relatively sluggish economic
growth in Botswana after 2009 was due to slow demand in diamonds worldwide. Furthermore, the
GDP growth rates for Malawi and Swaziland were the lowest at 1.8 per cent and 0.2 per cent respec-
tively. Overall, the average regional growth rate improved markedly from 0.2 per cent in 2009 to
4.6per cent in 2012 due to firm and improved commodity prices.

When compared with other regions on the continent, the SADC region registered the least growth in
sub-Saharan Africa for the period from 2008 to 2012 (Figure 1.3). Furthermore, recent projects point
to subdued growth prospects for the region (Figure 1.4).

2
Figure 1.2: SADC real GDP growth rates (percentage)

Source: Bank of Botswana, 2013.

Figure 1.3: Real GDP growth in Africa (2008 – 2012)

Source: ECA, 2013.

3
Figure 1.4: GDP growth outlook for Southern Africa

Source: ECA, 2013.

The SADC region’s combined gross domestic product (GDP) of US$ 655 billion in 2012 makes the re-
gion one of the most buoyant on the African continent (SADC, 2013). The region’s total GDP is much
higher than that of the East African Community (EAC) of some US$ 85 billion and that of the Econom-
ic Community of West African States (ECOWAS) of US$ 396 billion (EAC, 2013, SADC 2013). While eco-
nomic growth in SADC – like the rest of the continent – was adversely affected by the global financial
and economic crisis in 2007-8 and registered annual real GDP growth of 0.9 per cent in 2009, the re-
gion still grew by 4.6per cent in 2012 from 4.1 per cent in 2011 (SADC, 2013).Although growth lagged
behind the SADC’s secondary macroeconomic convergence target of annual real GDP growth of 7
per cent, it was comparable to the growth rates for EAC and ECOWAS in 2012. However, high growth
in SADC has failed to address the socioeconomic challenges in most countries of the region. For
instance, despite a decade of strong economic expansion, SADC unemployment of 26 per cent re-
mains rather high (Table 1.1). According to ECA (2013), 51 per cent of the unemployed in the region
are young women and 43 per cent are young men (ECA, 2013). Furthermore, human development
indicators in the region have remained comparatively subdued in SADC Member States despite the
positive growth. At 45.4 per cent, average poverty in the region remains comparatively high and the
pace of its reduction within Member States is also unacceptably slow. The high economic growth in
SADC therefore exists alongside high levels of poverty and inequality. As measured by the proportion
of the population below the national poverty datum line (PDL), poverty levels ranged from 9 per cent
in Mauritius in 2010 to 73 per cent for Zimbabwe in 2011–12. These rates were comparatively higher
than those obtaining in other regions on the continent. For example, the EAC has relatively lower
poverty levels, with only Burundi showing 67 per cent of its population above the national PDL and
the rest falling below 50 per cent. As for the ECOWAS region, poverty levels are higher than those in
SADC (SADC, 2013).

Furthermore, the high growth in this region has not addressed inequality4 in most Member States.
Inequality in the SADC subregion ranged from 38 per cent for the United Republic of Tanzania to 66
per cent for Seychelles in 2007 whereas, in the EAC and the ECOWAS regions, inequality was lower
with Gini coefficients (GC) ranging from 33 per cent to 51 per cent in both regions. The GCs for SADC
Member States for the period from 2003 to 2011-12are: Seychelles (66 per cent); South Africa (63per
cent); Namibia (60 per cent); Botswana (57 per cent); Zambia (55 per cent); Lesotho (53 per cent);
Swaziland (48 per cent); Mozambique (46 per cent); Democratic Republic of Congo (44 per cent);
Madagascar (44 per cent); Malawi (44 per cent); Angola (43 per cent); Zimbabwe (42per cent); Mauri-
tius (39 per cent); and the United Republic of Tanzania (38 per cent). The figures for Botswana, Namib-

4 Inequality as measured by the share of income held by the lowest 20 per cent and the highest 20 per cent of the population.

4
ia, Seychelles and South Africa seem to show that countries with higher incomes have higher levels
of income inequality. According to AfDB (2012), Southern Africa, when compared with other global
regions, has one of the highest levels of inequality in the world5. AfDB contends that, in addition to
being one of the poorest regions in the world, sub-Saharan Africa (SSA) is also the world’s second
most inequitable region after Latin America. It reports that six out of the 10 most unequal countries
worldwide were in SSA – and mostly in Southern Africa– in 2010. The most unequal countries were
Namibia, Comoros, South Africa, Angola, Botswana, Lesotho and Swaziland, with South Africa leading
the pack with a Gini coefficient increasing from 58 to 67 between 2000 and 2006.

According to the African Development Bank (AfDB, 2013d), SADC undernourishment for the period
from 2010 to 2012stood at 26.7 per cent, i.e. much higher than the average in ECOWAS Member
States at 11.8 per cent and in North Africa at 4.4 per cent. The report observes that maternal mortality
in 2010 was 382 for every 100,000 in SADC (North Africa: 84) and the literacy rate among men and
women aged 15–24 in the SADC region was 74 (North Africa: 85). In addition, the Gender-related
Development Index for SADC Member States was 0.560 in 2007 (North Africa: 0.693) and the Human
Development Index (HDI) for SADC Member States was 0.447 in 2012 (North Africa: 0.662). Overall,
the HDI of UNDP6reveals that only Seychelles, Mauritius, Botswana, South Africa and Swaziland have
performed relatively well in the region(UNDP, 2013).Table 1.1 shows human development indicators
in SADC Member States. Although it is accepted that changes in these indicators take time to show,
recent years should have seen the emergence of some positive developments and the firming of
growth patterns.

5 AfDB, 2012.
6 Composite index that measures average achievement in three basic parameters of human development – “a long and healthy life,
knowledge and a decent standard of living” and inequality-adjusted HDI (IHDI), which is HDI value adjusted for inequalities in the three basic
parameters of human development.

5
Table 1.1: SADC GDP and human development indicators

UNEMPLOYED (%)

ment Index (HDI)1

AREA (Million Ha)

justed HDI (IHDI)1

Human Develop-
GDP PER CAPITA

POVERTY LEVEL

LABOUR FORCE

Inequality - Ad-

AREA PER PER-

GDP OFFICIAL
POPULATION

(PPP) (US$)

SON (Ha)
(Million)
(Billion)

(%)
COUNTRY

1 Seychelles 90,846 0.0455 1.02 25,000 0.00 0.04 2.00 0.806 0.806 0.50
2 Mauritius 1,322,238 0.204 11.31 15,400 8.00 0.63 8.10 0.737 0.639 0.15
3 Botswana 2,127,825 58.17 14.23 15,700 17.80 1.29 17.80 0.634 0.634 27.34
4 South Africa 48,601,098 121.91 379.10 11,300 31.30 18.06 25.10 0.629 0.629 2.51
5 Swaziland 1,403,362 1.74 3.70 5,700 69.00 0.42 40.00 0.536 0.346 1.24
United Re-
public of 48,261,942 94.73 27.86 1,600 36.00 24.82 4.30 0.476 0.346 1.96
6 Tanzania
7 Madagascar 22,599,098 58.70 9.98 900 50.00 9.50 2.60 0.483 0.335 2.60
8 Namibia 2,182,852 82.43 12.90 7,800 55.80 0.91 51.20 0.608 0.344 37.76
9 Lesotho 1,936,181 3.04 2.43 2,100 49.00 0.86 25.00 0.461 0.296 1.57
10 Malawi 16,777,547 11.85 4.12 800 53.00 5.75 7.80 0.418 0.287 0.71
11 Angola 18,565,269 124.67 113.70 6,100 40.50 8.75 25.20 0.508 0.285 6.72
12 Zimbabwe 13,182,908 9.67 600 68.00 3.93 95.00 0.397 0.284 2.96
13 Zambia 14,222,233 75.26 20.31 1,700 64.00 6.10 14.00 0.448 0.283 5.29
14 Mozambique 24,096,669 79.94 14.05 1,200 52.00 10.29 17.00 0.327 0.220 3.32
Democratic
Republic of 75,507,308 234.49 17.01 400 71.00 34.12 49.10 0.304 0.183 3.11
15 Congo
         
Total/
Aver-
289,464,292 986.2595 629.06 6,420 44.36 125 26.08 0.415 0.298 3.39
age
=
Source: Human development indicators from UNDP, 2013; other data from www.cia.gov.

Other indicators of the quality of life such as access to clean energy demonstrate low levels of devel-
opment in the SADC region, compared with other regions on the continent. For example, access to
electricity in Southern Africa is only 24 per cent compared with 36 per cent for the East African power
pool and 44 per cent for the West African power pool (IRENA, 2014). In some SADC Member States,
access to electricity in rural areas is lower than even 5 per cent.

The preceding analysis has led some experts to describe recent growth in the SADC region as “jobless
growth”, “poverty-insensitive growth” and “non-inclusive growth,” contending that sustained growth
has failed to address the challenges associated with poverty and underdevelopment in the region.
Positive economic growth has to be accompanied by a clear transition from wealth (in this case,
based on natural resources) to economic well-being where the impacts of growing national output
are reflected in productive employment, improved skills levels, access to services and reduction in
poverty and inequality if growth is to be inclusive. The region’s high inequality hinders the transfor-
mation of the fruits of growth into poverty reduction and improvements in welfare.

6
In addition to poor policy frameworks that have denied countries the opportunities to optimize
revenues from the resources sector, illegal transfers of revenue earned from the exploitation of do-
mestic resources also act as a drain on economies. Table 1.2 shows that the Corruption Perceptions
Index (CPI) is below 50 out 100 for 80per cent of the SADC countries, most of whom are minerals
resource-rich.

Table 1.2: Contribution of mining to selected African economies

No. (in CORRUPTION PERCEP-
COUNTRY MINERALS IN TOP 3 EXPORT COMMODITIES (2005)
2013) TION INDEX (CPI)*
2012 2013
SOUTHERN AFRICA
Diamonds excluding industrial (1st, 88.2% STE)
30 Botswana 65 64
Nickel mattes, sinters, and the like (2nd, 8.1% STE)
47 Seychelles 52 54
52 Mauritius 57 52
55 Lesotho Diamonds excluding industrial (3 , 15.0% STE)
rd
45 49
Diamonds excluding industrial (1 , 39.1%);
st

57 Namibia Radioactive chemicals (2nd, 11.4% STE); 48 48

Zinc, zinc alloy, unwrought (3rd, 9.7% STE)
Platinum (1st, 12.5% STE);
72 South Africa Other coal, not agglomerated (2nd, 8.0% STE); 43 42
Gold, non-monetary excluding ores (3rd, 7.9% STE)
82 Swaziland 37 39
Copper, anodes, alloys (1 , 55.8% STE);
st
83 Zambia 37 38
Cobalt, cadmium, and the like, unwrought (2nd, 7.0% STE)
91 Malawi Uranium 37 37
United Republic of Gold, non-monetary excluding ores (1 , 10.9% STE);
st
111 35 33
Tanzania Copper ores, concentrates (3rd, 8.6% STE)
119 Mozambique Aluminium, aluminium alloy, unwrought (1st, 73.4% STE) 31 30
127 Madagascar 32 28
153 Angola Oil (1 in SADC, 2nd in Africa)
st
22 23
Democratic Repub- Diamonds excluding industrial (1 , 42.6% STE)
st
154 21 22
lic of the Congo Other nonferrous ore, concentrated (2nd, 17.2%)
157 Nickel, nickel alloy, unwrought (2nd, 12.6% STE);
20 21
Zimbabwe Nickel ores, concentrates (3rd, 12.3% STE)
Total = 9 countries
The Corruption Perceptions Index ranks countries and territories based on how corrupt their public sector
is perceived to be. A country or territory’s score indicates the perceived level of public sector corruption on a
scale of 0 - 100, where 0 means that a country is perceived as highly corrupt and 100 means it is perceived as
very clean. A country’s rank indicates its position relative to the other countries and territories included in the
index. This year’s index includes 177 countries and territories. (http://cpi.transparency.org/cpi2013/results)
Source: World Bank, 2013.
* http://cpi.transparency.org/cpi2013/results)

Revenues earned in SADC Member States are generally and disproportionately remitted outside
without contributing to local development. Table 1.3 shows that, between the 1970s and 2010, off-
shore wealth had accumulated to at least US$127 billion7. When compared to the SADC region’s total
public sector external debt, which stood at US$103 billion in 2010, this translates to a flight stock to
debt ratio of131per cent. These transfers are occurring from a region where there is high unemploy-
ment, spiralling poverty and increasing inequality. Foreign direct investment (FDI) inflows into the
7 http://www.theguardian.com/global-development/datablog/2012/jul/19/developing-world-offshore-wealth-external-debt .

7
SADC region amounted to US$8.2 billion in 2010, which was about 6.46per cent of money accumu-
lated outside the region (United Nations Conference on Trade and Development, 2013).

Table 1.3: Capital flight from SADC and external debt up to 2010

Real capital flight for External debt Flight stock

Flight stock (US$
Country Period period (US$ billion, (US$ billion, to debt (%)
billion, 2010)
2000) 2010) 2010
South Africa 1970-2010 29.8 60.3 45.5 133
Angola 1989-2010 30.7 41.8 18.7 224
Zambia 1970-2010 6.0 11.4 3.7 308
United Republic of Tanzania 1970-2010 1.2 6.8 8.6 79
Democratic Republic of the
Congo 1970-2010 2.9 6.4 5.7 112
Botswana 1977-2010 2.7 5.0 1.7 294
Lesotho 1977-2010 0.7 1.3 0.7 186
Swaziland 1974-2010 0.6 0.8 0.6 133
Mozambique 1984-2010 0.1 0.8 4.0 20
Zimbabwe 1970-2010 -3.2 0.8 4.5 18
Namibia 1998-2010 0.6 0.7 2.9 24
Seychelles 1981-2010 0.5 0.7 1.6 44
Madagascar 1970-2010 -1.7 -1.7 2.3 N/A
Malawi 1970-2010 -2.5 -3.1 0.9 N/A
Mauritius 1976-2010 -4.5 -5 1.1 N/A

Average 63.9 127 102.5 131

Source: www.theguardian.com . 22 July 2012.

The dimensions of inclusive growth

It is instructive to review the various dimensions of the concept of inclusive growth in order to pro-
vide key parameters pertinent to the analysis in this study. The African Development Bank (AfDB,
2013b) has noted the lack of a universally agreed definition of inclusive growth. Nevertheless, the
Bank contends that inclusive growth should focus on both creating opportunities and making these
opportunities accessible to all. Inclusive growth should be a process whereby individuals are pro-
vided with improved opportunities to benefit from economic growth. Thus, according to this view,
inclusive growth is economic growth that results in greater access to sustainable socioeconomic
opportunities for a larger number of people, regions or countries, while protecting the vulnerable, all
of which is carried out in an environment of fairness, equal justice and political plurality (AfDB, 2012).
It is broad-based growth across sectors and includes generating productive employment and pro-
tecting disadvantaged and marginalized groups from adverse shocks. Since inclusive growth analysis
takes into account parameters such as age, gender, regional or geographical gaps and balances, and
sectoral differences and balances, it has elements pertaining to “broad-based growth, shared growth,
and pro-poor growth”.

The World Bank’s definition (2008) adopts a long-term perspective of inclusive growth and is con-
cerned with both sustained growth and structural transformation for economic diversification, oc-
curring across sectors where equality of opportunity in terms of access to markets and resources ex-
ists and there is an unbiased regulatory environment for businesses and individuals. This view focuses
8
on the pace and pattern of growth, on productive employment rather than income redistribution
and on employment growth and productivity growth. Overall, this definition relates to economic
growth, which is a necessary and crucial condition for poverty reduction.

In another view, the European Union observes that inclusive growth means growth based on a high
employment economy and that all groups in society participate in such a growth while also enjoy-
ing its benefits (Fischer, 2012). According to the EU 2020 Strategy, inclusive growth is one of the top
priorities of European Union, together with “smart” and “sustainable” growth. The European Union
has identified three key drivers for growth, which will be supported through actions at both EU and
national levels (EUFacts, 2010). These drivers are: smart growth, sustainable growth and inclusive
growth. While smart growth focuses on fostering knowledge, innovation, education and digital so-
ciety, sustainable growth targets making EU production greener and more resource-efficient while
boosting competitiveness. Finally, inclusive growth focuses on enhancing labour market participa-
tion, skills acquisition and the fight against poverty.

The Asian Development Bank (AsDB, 2007) defines inclusive growth as growth with equal opportu-
nities, which should therefore focus on both creating opportunities and making those opportunities
accessible to all. The Bank contends that growth is inclusive when it allows all members of a given
society to participate in, and contribute to, the growth process on an equal basis regardless of their
individual circumstances. The AsDB has also constructed a composite inclusive growth index at the
country level and has identified suitable indicators for (i) growth, productive employment and eco-
nomic infrastructure; (ii) income poverty and equity, including gender equity; (iii) human capabilities;
and (iv) social protection.

Other definitions8 of inclusive growth have focused on the same broad parameters of productive
employment and access to opportunities. At another extreme, inclusive growth is also sometimes
loosely referred to as “growth that benefits everyone”, which appears to imply that growth should
“benefit all segments of society, including the poor, the near-poor, the middle income groups, and
even the rich”.

Although in some literature the term “inclusive growth” is often used interchangeably with a suite of
other terms including “broad-based growth”, “shared growth”, and “pro-poor growth”, it can be con-
cluded from the above review that inclusive growth is about allowing people to contribute to and
benefit from economic growth and, together with sustainability, encompasses being broad-based,
shared and pro-poor. Overall, inclusive growth then is growth that reduces the disadvantages of the
most disadvantaged while benefiting everyone.

The definition of the natural resource-based inclusive growth in the SADC region proposed in this
report recognises the importance of the following components: (i) the presence of natural resources
(ii) abilities, skills and capacities to efficiently and sustainably utilize natural resources in their raw or
processed form for socioeconomic benefits, (iii) direct and indirect responsibility borne by all persons
and institutions in the region to safeguard natural resources for their continued existence, (iv) active
participation by all capable people present in the natural resource locality in quality inclusive growth
activities throughout their productive lifespan, (v) opportunities for all people in natural resources
localities to directly and indirectly enjoy benefits of the resources without undue hindrance, and (vi)
benefits from natural resources in a locality to work for the people of the locality and country.
The report defines natural resource-based inclusive growth as growth where all capable people in a
given geographical area are equitably facilitated with conditions and opportunities to actively, effi-
ciently and responsibly apply their abilities during their functional lifetime to utilize natural resources
8 See, for example, World Bank, 2009.

9
for their livelihoods and enjoy benefits from these resources throughout their lifetime without undue
internally induced hindrance on a sustainable basis. This broad definition entails the condition that
the natural resources available in a locality are sustainably utilized so that both present and future
generations can derive optimal socioeconomic benefits, facilitate everyone with conditions and op-
portunities to actively, efficiently and responsibly apply their abilities, and skills and capacities to
efficiently utilize natural resources for their livelihoods with minimal or no wastage, that people can
attain a high degree of performance during their functional lifetimes and that they enjoy the benefits
derived from natural resources without undue internally induced hindrance on a sustainable basis.

Overall, inclusive growth focuses on the rate and pattern of growth, which must be addressed to-
gether because they are interlinked. Long-term sustainable high levels of economic growth are nec-
essary to reduce poverty and must be accompanied by growing productive employment to reduce
inequality. Policies for inclusive growth must address productive employment rather than merely
keeping people engaged or distributing income. Unlike the pro-poor growth agenda focusing main-
ly on the welfare of the poor, inclusive growth is concerned with opportunities for the labour force
in the poor and middleclass alike. It takes a long-term view and focuses on increasing the pace of
growth, productivity growth and enlarging the size of an economy while levelling the playing field
for investment and boosting productive employment opportunities.

Study objectives and methodology

The overall objective of this study is to review how the SADC region could make natural resources
work for inclusive growth and sustainable development and to recommend actions where appropri-
ate. The study considers how the exploitation of various natural resources in the SADC region could
address poverty, unemployment and inequality while ensuring that everyone is better off. The focus
is on how SADC Member States can achieve material and social progress through economic growth
while ensuring equity, equal opportunity, skills and capacities to actively and responsibly participate
in inclusive growth activities, accessing key markets, uplifting economies of the disadvantaged, and
guaranteeing social protection for the most vulnerable in society. Specifically, the study seeks to
document and analyse the exploitation of various natural resources in the region and assess their
contribution to inclusive growth, identify challenges, evaluate exploitation strategies and how they
are aligned to the objectives of inclusive growth and sustainable development. It seeks to propose
feasible recommendations for the realization of the subregion’s inclusive growth and sustainable
development objectives.

The methodology used for this study includes both primary and secondary information. For second-
ary information, literature from ECA regional office in Lusaka, key informant institutions, pertinent line
ministries in SADC and websites were the main sources. The information was analysed, crosschecked
and compiled in accordance with the objectives of this study. Primary information was sought from
relevant ministries and institutions in SADC Member States, the SADC Secretariat and from other
informant institutions. The study also benefited from inputs by experts who reviewed the original
draft and from comments by delegates to the Twentieth Intergovernmental Committee of Experts of
Southern Africa meeting held in Livingstone, Zambia in March 2014.

Scope of the study

The study covered all natural resources (land and agriculture, renewable and non-renewable re-
sources, minerals, water, forestry, human resources and wildlife) in all the SADC Member States and
reviewed experiences from elsewhere for possible lessons. Various natural resource endowments,

10
their exploitation and management were analysed, current production and processing systems were
documented, the challenges isolated and proposals were made on how improvements could be
introduced to strengthen policy and practice in the short, medium and long term. The analysis of the
individual natural resources identified the challenges towards inclusivity and recommended national
and regional actions towards strengthening the contribution of the exploitation of resources to in-
clusive growth.

Structure of the study

This study consists of three chapters following the introduction and overview which deal with the
background, scope and methodology of the study. Chapter 1 also provides a definition of inclusive
growth and identifies the boundary conditions of the definition adopted for this study.

Chapter 2 presents an overview of the exploitation of natural resources in the SADC region. It ex-
plores the exploitation of land and agricultural resources, minerals (which also include oil and gas),
forestry, wildlife, water and renewable energies. It also highlights the resource potential, the sector
and its players, the contribution to economic indicators and outlines the challenges hindering mean-
ingful contribution to inclusive growth. Human capital is discussed as an important natural resource
on which depend all anthropogenic activities and productivity.

Chapter 3outlines inclusive growth principles and proposes policy measures and activities required
to increase the contribution to inclusive growth in the SADC region on a resource-by-resource basis.
The chapter provides examples of best practices in SADC and from other countries on strengthening
the contribution of natural resources to overall inclusive growth.

Chapter 4 provides a summary of the findings, conclusions and recommendations from the study.
The chapter re-emphasizes the mismatch between natural resources endowment and their exploita-
tion, on the one hand, and inclusive growth, on the other, providing a list of targeted recommenda-
tions to address these challenges at national and subregional levels.

Study limitations
The major limitation in conducting this study was the lack of comprehensive national-level informa-
tion on the contribution of the different natural resources to inclusive growth. For example, there was
a general lack of detailed and specific information on the forestry sector in all the countries under
review, especially on the documentation of small-scale forestry activities. Similarly, the small-scale
activities of communities in the fishery sector are not captured in official statistics. Yet these activities
have a direct impact on incomes, poverty and unemployment in this sector’s communities.
Summary

This chapter has referred to the vast quantities of natural resources including land, water, forestry,
fisheries, and minerals, which are the main focus of both regional economic activities and regional
growth. It observed that the estimated total SADC GDP from the exploitation of natural resources,
their products, and various services in the region amounted to US$629 billion in 2012 and noted
that high levels of average GDP growth of about 4 per cent in the region has failed to address socio-
economic challenges in most SADC countries. The huge disparity between what the exploitation of
available natural resources in the region can potentially contribute and what they are actually con-
tributing towards addressing developmental challenges is a real concern. Resources should be the
route through which the pursuit of inclusive growth and sustainable development goals such as job

11
creation, food security, and effective and efficient social services delivery is furthered. That inclusive
growth remains elusive for most countries in the region owing to various factors including poorly
designed policy frameworks is an additional concern. This chapter has provided a definition of inclu-
sive growth, which delimits the boundaries in the analysis in the rest of the study. Inclusive growth
is growth where all people in a given geographical area are equitably facilitated with conditions and
opportunities to actively, efficiently and responsibly apply their abilities during their functional life-
time to utilize natural resources for their livelihoods and enjoy benefits from these resources through-
out their lifetime without undue internally induced hindrance on a sustainable basis.

This chapter has outlined the methodology, scope and limitations of the study and underscored that
it was based mainly on deskwork.

12
Chapter 2: Exploitation of natural resources in the SADC
region
Overview
This chapter reviews the exploitation of various natural resources in the SADC region and explores
the key challenges in the resources contributing effectively to inclusive growth. The 15 Member
States of SADC are richly endowed with land, water, minerals, forests and tourism resources. The
region has a land area of about 964.63 million hectares of which 23.4per cent is arable. It possesses
394 million hectares of forestry, 21.6 million hectares of inland and marine water resources and a
variety of industrial, precious, metallic and hydrocarbon minerals. In addition, the region is endowed
with wind speeds as high as 9m/s onshore and high solar insolation levels averaging between 5.5
to 7 kWh/m2 per day (IRENA 2014). Furthermore, the region’s diverse wildlife and tourism resources
remain untapped. As noted earlier, the exploitation of these natural resources has been at the heart
of economic growth and development in the region.

Land and agriculture

Land

Land is a critical productive asset on which many livelihoods depend and is at the centre of any de-
velopment9. All anthropogenic activities require land, directly or indirectly, for exploitation to occur.
Thus, access to land and the manner in which land is managed are important for growth and devel-
opment as access and management impacts on all land-based socioeconomic activities. Access to
land and sustainable land management practices are crucial to minimize the adverse effects on food
security, the national economy in general, environment and inclusive growth. For example, land pro-
vides a variety of livelihood options for farmers in the SADC region as a majority of rural households
in the region rely on cash and subsistence incomes from a number of land-based economic activities
including the production of irrigated and rain-fed crops, livestock rearing and harvesting of timber
resources (for timber and charcoal production).

In this way, the system of land tenure, defining the ownership of and the access to land, impacts on
access for economic purposes and directly affects the potential to derive livelihoods from the land.
By defining the terms and conditions under which land resources are held and used, land tenure sys-
tems impact on productive investment decisions based on land. For rural areas in the SADC region,
land tenure directly impacts on: the use of land, agricultural production efficiency, access to cred-
it, conflict management mechanisms, income, economic stability, employment, and fragmentation
of landholdings. Similarly, land tenure impacts on economic stability, income and access to credit
among urban dwellers. The increase in urban agriculture in the region has also made access to land
for agricultural purposes an important economic factor, as the latter directly impacts on food security
among the urban population.

Land tenure systems vary widely in Southern Africa, being influenced by colonial legacies and post-in-
dependence strategies (SACAU, 2010). For example, the systems of land tenure based on freehold
and leasehold are derived from Roman-Dutch law (ECA, 2004). Given the protection freehold land
tenure received from the state and its institutions, it is arguably the most secure form of tenure. On

9 http://web.undp.org/drylands/gov-ltenure.html.

13
the other hand, leasehold lands are land rentals over agreed periods between entities where lease
agreements are registered against the title of the subject land to create enforceable land rights. In
practice, the issuing of 99-year leases is considered to be as secure as a freehold tenure system. In the
SADC region, people living in areas under customary systems occupy land by the permission of the
state, which is the ultimate holder of title so that whenever the state so desires, permission to occupy
and use land can be withdrawn administratively. In some cases, people have also experienced forced
removals from land appropriated without recourse to law (ECA, 2004). Customary law tenure is con-
sidered insecure and fragile, and cannot be used as collateral to access loans. Furthermore, there also
exists both social and gender dimensions in land tenure, resulting in unequal and inequitable access
to and use of land, most particularly for women.

Land tenure in the British colonies was shaped by imbalances in the patterns of ownership in the
former settler colonial states of Namibia, South Africa and Zimbabwe (SACAU, 2010; Mgugu, 2005).
By contrast, tenure rights and land use were the features in the former protectorates of Botswana,
Malawi and Zambia. Furthermore, the cold war also impacted on land systems in Angola, the Unit-
ed Republic of Tanzania and Mozambique. However, since independence at various periods, SADC
Member States have undertaken land reforms to address the colonial imbalances in land ownership.
These reforms have included various shades of: (i) land redistribution and resettlement through com-
pulsory acquisition; (ii) land rationalization through vesting control of all land in the state and then
asserting the power of the state over individuals and traditional leaders; (iii) the introduction of land
registration and titling through the issuance of land ownership certificates on demarcated land; (iv)
collectivization of land ownership through the encouragement or compulsory creation of collective
cooperatives; and (v) land development through the proclamation of large development projects
(conservancies, forest areas, dams), which restructure land use and ownership rights.

The SACAU (2010) study identified five main country type-based land issue characteristics from the
15 SADC Member States. These country types impact on land use and hence policy options, includ-
ing those for inclusive growth. The country types are: (i) population-driven land scarcity countries (as
in Malawi, Swaziland and Lesotho); (ii) land-abundant countries (Zambia Mozambique, Madagascar
and the United Republic of Tanzania); (iii) countries with economic development-driven land compe-
tition (Mauritius and South Africa); (iv) countries with poor agricultural endowments (Botswana, Sey-
chelles and Lesotho), and (v) countries with politically unstable land ownership patterns (South Afri-
ca, Namibia and Zimbabwe). Although the boundaries defining this classification may not be exact
or static, each is peculiar and directly impacts on how the land is accessed and utilized and, hence,
on its ultimate potential to contribute to inclusive growth. For example, whereas in land-abundant
countries, land access and use is not constrained by land availability but by factors such as access
to infrastructure, markets and finance, in countries with economic development-driven land com-
petition, the central importance of agriculture has gradually declined in favour of other sectors and
where competition among land uses including manufacturing, tourism, infrastructure development
and settlement is the farmers’ primary concern in terms of land access. As observed earlier, land
access and land tenure cannot be delinked from inclusive growth in highly agricultural dependent
economies. Sustainable development and food security in the resource-dependent primary econo-
mies of the SADC region are closely linked with equitable access to secure land. Unfortunately, there
is generally a tendency for land to be unequally distributed, and most groups of people in customary
land systems have limited land rights.

The data in table 2.1 show that the total land area in the SADC region of nearly 986 million hectares
consists of 53 million hectares (5.36 per cent) of arable land, 4.5 million hectares (0.46 per cent) of
land under permanent crop, 359 million hectares (36.4 per cent) of pasture land, 3.5 million hectares
of irrigated land, and 3.4 million hectares of plantation and forestry. In 2010, over 152 million people

14
in SADC (over 55 per cent of the regional population) depended on agriculture for their livelihood
and thus relied directly on the land. Agriculture is therefore an important sector for promoting inclu-
sive growth in the SADC region, and access to land consequently becomes particularly important.

However, SADC citizens have struggled to utilize land optimally owing to a plethora of challenges.
The main challenges can be classified into two broad categories; land tenure-related constraints and
productive land use-related constraints. The critical land tenure-related issues that impinge on land
use are: generally poor land administration (obtaining title) systems that directly affect the ability to
use the land as collateral and to participate in land markets. The economic use of land is affected pri-
marily by land tenure and also by the lack of infrastructure in farming areas, limited financial resources
by landowners, lack of land markets in rural areas, conflicts between competing uses of land, access
to input and output markets and management skills so that the inability to secure land contributes
to this sector’s inability to contribute to inclusive growth.

15
 Table 2.1: Major land uses in the SADC region

16
Forest
Total Land Agricultural Land Plantation Total Population Agricultural Population
Area Total Ara- Permanent Irrigated
Pastures
ble Land Crop Land
COUNTRY X 1000 Ha Ha X 1000 X 1000 %
X 1000 Ha
X 1000 Ha X 1000 Ha X 1000 Ha
2008 2008 2008 2008 2008 2012 2008 2010 2008 2010 2008 2010
Angola 124 670.0 3 400.0 290.0 54 000.0 80.0 128,000 18 021.0 18 993.0 12 574.0 13 160.0 69.8 69.3
Botswana 58 173.0 250.0 2.0 25 600.0 2.0 0 1 921.0 1 978.0 818.0 834.0 42.6 42.2
Democratic
Republic of 234 486.0 6 700.0 750.0 15 000.0 11.0 59,000 64 257.0 67 827.0 37 424.0 38 834.0 58.2 57.3
the Congo
Lesotho 3 035.0 355.0 4.0 2 000.0 3.0 10,000 2 049.0 2 084.0 817.0 819.0 39.9 39.3
Madagascar 58 704.0 2 950.0 600.0 37 295.0 1 086.0 415,000 19 111.0 20 146.0 13 596.0 14 132.0 71.1 70.1
Malawi 11 848.0 3 500.0 122.0 1 850.0 59.0 365,000 14 846.0 15 692.0 10 990.0 11 450.0 74.0 73.0
Mauritius 186.5 85.4 4.0 7.0 21.0 15,000 1 280.0 1 297.0 110.0 104.0 8.6 8.0
Mozambique 79 938.0 4 500.0 250.0 44 000.0 118.0 62,000 22 383.0 23 406.0 17 139.0 17 788.0 76.6 76.0
Namibia 82 429.0 800.0 8.0 38 000.0 8.0 0 2 130.0 2 212.0 906.0 905.0 42.5 40.9
Seychelles 46.0 1.0 3.0 0.3 5,000 84.0 85.0 63.0 63.0 75.0 74.1
South Africa 121 909.0 14 500.0 950.0 83 928.0 1 498.0 1,763,000 49 668.0 50 492.0 5 206.0 4 931.0 10.5 9.8
Swaziland 1 736.0 178.0 14.0 1 032.0 50.0 140,000 1 168.0 1 202.0 351.0 346.0 30.1 28.8
United Re-
public of 94 730.0 9 600.0 1 350.0 24 000.0 184.0 240,000 42 484.0 45 040.0 31 585.0 33 006.0 74.3 73.3
Tanzania
Zambia 75 261.0 2 355.0 29.0 20 000.0 156.0 62,000 12,526 13,093 8 140.0 8 387.0 65.0 64.1
Zimbabwe 39 076.0 3 730.0 120.0 12 100.0 174.0 108,000 12 463.0 12 644.0 7 207.0 7 144.0 57.8 56.5
SADC - 986 227.5 52 904.4 4 496.0 358 812.0 3 450.3 3 372 000.0 264 390.8 276 190.7 146 926.0 151 903.0 55.6 55.0
Source: www.sadc.int.
Agriculture10

Agro resources are multiple and combine natural resources such as land and soils, water and sun-
shine. The agriculture sector in the region provides livelihood and subsistence, employment and
income, and creates wealth. It is a major employer in the region and contributed eight per cent to
regional GDP in 2012. An estimated 82.8 million people, or 66per cent of the regional labour force,
were employed in this sector11. The sector registered positive annual growth of 2.6per cent against
population growth of 2.5 per cent in the previous decade (SADC FANR, 2013). The World Bank (2008)
argues that average growth in the agriculture sector is at least twice as effective in reducing poverty
as growth outside agriculture. As a result, agriculture is central to poverty reduction, inclusive growth,
and food and nutrition security in the SADC region. Agriculture also has the potential to contrib-
ute to the socioeconomic development of the region through direct and indirect employment, and
through backward and forward linkages along the value chain, especially with value addition. Since
many of the world’s poorest people are themselves farmers, GDP growth generated by agriculture
can contribute towards reducing poverty (World Bank, 2008; Cervantes-Godoy and Dewbre, 2010).

The sector consists of subsistence, smallholder and large-scale commercial farmers producing a va-
riety of crops and animals. Generally, smallholder 
farmers in SADC are poorly organized. On average,
the land owned
is up to one hectare with maize as the main staple crop, and the fertiliser used is only
20per cent of recommended or desired levels, resulting in maize yields of 100 kg/ha. Small holder
farmers also use recycled seeds and usually own a hand hoe as an agricultural tool. Yet these farm-
ers
are responsible
for
over
80 per cent
 of
staple
food
crop production in Africa (Food, Agriculture
and Natural Resources Policy Analysis Network (FANRPAN), 2009). In sub-Saharan Africa alone, small
scale farmers account for 70per cent of the agricultural labour force12, but unfortunately make up
80per cent of people living with HIV/AIDS. Furthermore, 75per cent of women living with HIV/AIDS
are in sub-Saharan Africa (AfDB, 2013a).Furthermore, women comprise, on average, 43 per cent of
the agricultural labour force in developing countries, ranging from 20 per cent in Latin America to
50 per cent in Eastern Asia and sub-Saharan Africa. Issues of gender equality and income distribu-
tion can thus be addressed by increasing incomes to farm workers and farmers(FAO, 2011).Women
constitute more than 70per cent of those who are wholly reliant on agriculture as a livelihood in the
region13. However, less than one per cent of women own agricultural land, and they can only access
less than 10per cent of available agricultural credit worldwide. Challenges still remain in the agricul-
tural sector despite the good intentions of the SADC Protocol on Gender and Development on the
empowerment of women and the elimination of discrimination and the pursuit of gender equality
and equity through the development and implementation of gender responsive legislation, policies
and programmes. This situation poses a threat to inclusive growth.

The continental framework for the agricultural sector is the Comprehensive Africa Agriculture De-
velopment Programme (CAADP), whose goal is to achieve annual average growth of six per cent
in the agricultural sector and halve poverty and hunger by 2015 (International Water Management
Institute& Regional Strategic Analysis and Knowledge Support System-Southern Africa (IWMI & Re-
SAKSS-SA), 2013). The region has domesticated CAADP through country compacts. Unfortunately, in
2012 agriculture growth rates in the region were still lower than the CAADP target with the excep-
tion of Malawi, Zambia and Zimbabwe. Furthermore, fertilizer application in the region, especially in
low-income SADC countries, was still lower than 65kg/ha as stipulated by the Abuja Declaration and
the regional target of 50kg/ha under the Regional Indicative Strategic Development Plan (RISDP).
10 Includes crop and animal farming.
11 www.cia.gov.
12 http://www.fao.org/docrep/v4805e/v4805e03.htm#P119_22526 .
13 www.southernafricatrust.org .

17
Low-income countries in the region allocate less than eight per cent of their national budgets to
agriculture whilst middle-income countries allocate about two per cent of their national budgets
to agriculture (FANRPAN, 2009). Furthermore, expenditure on research and development (R&D) as a
share of agriculture GDP (AgGDP) remains low and continues to be lower than the target of one per
cent under the New Partnership for African Development (NEPAD, 2013).The share of average gov-
ernment spending on agriculture in the SADC region in 2010 was 5.8per cent compared with 7.3per
cent for West Africa14. This is still lower than the Maputo Declaration target of 10per cent.

According to NEPAD Policy and Coordination Agency (NPCA, 2013a), however, seven out of the 15
SADC countries had signed the compact as of February 2013: these include the Democratic Republic
of the Congo (18 March 2011), Malawi (19 April 2010), Mozambique (9 December 2011), Seychelles
(16 September2011), Swaziland (4 March 2011), the United Republic of Tanzania (8 October 2011),
and Zambia (18 January 2011). Of these countries, only Malawi, Zambia and Zimbabwe have met
budgetary targets of not less than 10 per cent for agriculture. Under the SADC Regional Agricultural
Policy, Member States endeavour to support agricultural development and enhance its role in re-
gional development. As signatory to CAADP, the SADC region is bound by commitments under the
pillars of land and water management, market, food supply and hunger, and agricultural research in
its endeavours to promote agriculture-led development.

In terms of agricultural production, the SADC region remains a net importer of most agricultural
products. Malnutrition and food-insecure population levels remain high, with the percentage of un-
derweight children exceeding 26 per cent in nearly all countries of the region (AfdB, 2013a). The
agricultural sector has performed poorly owing to low labour and land productivity (poor soils). Fur-
thermore, average labour productivity in the region’s agriculture sector is 30 times lower than in
developed countries (IWMI & ReSAKSS-SA, 2013). In commercial agriculture, by contrast, productivity
is comparable to international standards15. Similarly, although land productivity in the SADC region
has grown by a mere one per cent per year from the 1990s, it has more than tripled in other regions.16
In addition, average cereal yields have remained between 1.5 and 1.7 MT/ha since 2000, with low-in-
come countries accruing the smallest yields. This range is below the African average of 2 MT/ha
and 8 MT/ha for developed countries. While intraregional agricultural trade has outperformed other
sectors, overall intraregional trade remains at 10per cent of total trade, compared to 30 per cent reg-
istered by the Association of Southeast Asian Nations (ASEAN) region17.

The total trade of SADC Member States is 15.5per cent within Africa and 12.1per cent within SADC
(AfDB, 2014). Trade is the key driver for agricultural growth. Poor rural infrastructure makes moving
produce from rural to urban areas difficult, and knowledge of potential markets and market expecta-
tions are also limited. Smallholder farmers suffer huge post-harvest losses owing to poor infrastruc-
ture and challenges with accessing markets. The trend towards informal cross-border trade in SADC
has accelerated in recent years, with an estimated business volume of US$17.6 billion per year18.

Challenges in the agricultural sector

The sector faces challenges associated with low domestic value addition along the value chain, which
denies SADC Member States higher levels of revenues and the benefits of linkages with the domestic
economy. The failure to exploit the benefits of domesticated agricultural value chains is one of the
14 See www.nepad.org. Agricultural transformation .
15 SADC Agricultural Policy.
16 See IWMI & ReSAKSS-SA, 2013.
17 SADC Agricultural Policy 2013.
18 http://www.southernafricatrust.org/changemakers/

18
major challenges facing the sector in this region. The region’s agricultural products are exported in
semi-processed form, which exposes them to many challenges such as disease and spoiling.

Access to agricultural land by smallholder farmers, who are mainly women, is another handicap in
the sector. As noted earlier, smallholder 
farmers dominate the sector, and their average landholdings
are about one hectare land, which is rather small for commercial purposes. Furthermore, owing to
capacity constraints, fertiliser application by these farmers is only 20 per cent of the recommended or
desired levels, which results in average maize yields of 100 kg/ha. Notwithstanding these challenges,
smallholder farmers account for
over
80 per cent
of
staple
food
crops in Africa (FANRPAN 2009). Al-
though women constitute more than 70 per cent of those who are wholly reliant on agriculture as a
livelihood in the region19, less than one per cent of women own agricultural land and they can only
access less than ten per cent of available agricultural credit. Lack of access to land and the inability to
access affordable finance reinforce the failure to produce optimally and hence constrain the impact
of agriculture on inclusive growth. As noted earlier, furthermore, although small-scale farmers in SSA
account for 70 per cent of the agricultural labour force,20 they unfortunately also make up 80 per cent
of people living with HIV/AIDS. In addition, AfDB (2013a) reports that 75 per cent of women living
with HIV/AIDS are in SSA and this is in a region where women are the largest group of farmers. This
situation not only affects agricultural productivity but also the quality and span of their participation
in contributing to inclusive growth.

Other constraints in the sector include: poor organization of smallholder farmers; inadequate infra-
structure in agricultural areas for marketing agricultural produce, resulting in large post-harvest losses
incurred by smallholder farmers’ limited access to markets; limited support for informal cross-border
trade in the region and weak irrigation infrastructure to facilitate farming beyond the rainy seasons.
Generally, irrigation infrastructure is poorly developed in the SADC region, especially among small-
holder farmers. Yet, irrigation increases agricultural productivity and provides relief during drought
periods. Furthermore, smallholder farmers and women lack affordable financial resources, thereby
limiting their capacity to expand. These challenges generally contribute to low agricultural produc-
tivity and low revenues and hence impact on the sector’s contribution to inclusive growth.

Mineral resources
The SADC region produces various minerals including copper, chromium, cobalt, diamonds, coal,
hydrocarbons, gold and PGMs, coloured stones at various scales from artisanal mining to large-scale
production (appendix 2). The principal mining countries in the region are Angola, Botswana, the
Democratic Republic of the Congo, Namibia, South Africa, the United Republic of Tanzania, Zambia
and Zimbabwe, which account for the largest proportion of mineral output in the region. For exam-
ple, Angola produces about 650 barrels of oil per day and, after Nigeria, is the second largest oil pro-
ducer in Africa. Similarly, Botswana currently accounts for 28 per cent of global diamond production,
and in 2012the Democratic Republic of the Congo accounted for 64per cent of the world’s cobalt
production, 31 per cent of global industrial diamond production, six per cent of gem quality dia-
monds and nine per cent of the world’s tantalum production (Ksezniak and Stucchi, 2013) and 80per
cent of niobium (Oxford Policy Management (OPM) and Synergy, 2013). South Africa is the world’s
sixth largest producer of gold while Tanzania holds about 34per cent of the world’s gas reserves (6.5
billion cubic meters) and Mozambique had 126 billion cubic meters of proven gas reserves (Ernest
& Young, 2012). Zambia is currently ranked seventh in the world for copper production and hosts an

19 www.southernafricatrust.org
20 http://www.fao.org/docrep/v4805e/v4805e03.htm#P119_22526

19
estimated 2.8 billion tons of copper ore ranging between 0.6 per cent and 4 per cent of copper.21
South Africa and Zimbabwe account for about 89per cent of the world’s PGMs production (Policy
for Natural Resources (POLINARES), 2012), and Zimbabwe currently hosts a quarter of the world’s
diamond reserves (UKAid and World Bank, 2011). In 2012 diamonds accounted for 11.3 per cent of
Namibia’s GDP (Namibia Statistics Agency, 2013). Malawi was ranked the world’s 11th largest uranium
producer in 2010 and produced 670 tons or 1.2per cent of global uranium production.22 However,
the region remains relatively underexplored and, with an estimated average exploration expenditure
of $5 per km2 (Australia and Canada: $65 per km2), the geological potential of most countries in the
region remains known.23

The minerals sector is a key contributor to government revenues, foreign exchange, employment,
skills development and industrial development. Figure 2.1 shows that the contribution by the mining
industry to GDP has been on a steady increase since 2000. In 2012 mining contributed an average
of 16 per cent to regional GDP (SSY, 2012).Table 2.2 shows the contribution of the minerals sector to
GDP in 2012, which ranged from 0.04 per cent in Mauritius to 47 per cent in Angola where the oil
sector accounts for 46 per cent of GDP, 80 per cent of government revenues and 95 per cent of ex-
ports. This sector, although highly capital intensive, generates employment for the country’s citizens.
In 2012, for example, large-scale mining contributed some 13,000 jobs24 in Botswana, about 7,898
jobs in Namibia (CMN, 2012), around 1,365,892in South Africa (CMSA, 2013), approximately 300,000
jobs in Zambia (Policy Monitoring and Research Centre, 2013), and about 45,000 jobs in Zimbabwe
(ZEPARU, 2012).Although mining is not a major direct employer owing to its capital-intensive nature,
it generates many indirect jobs through linkages, especially where beneficiation and value addition
are undertaken locally (SADC, 2014).

Figure 2.1: Contribution of mining industry to SADC GDP

20
18
16
14
12
10
8
6
4
2
0
1998 2000 2002 2004 2006 2008 2010 2012

Source: SSY, 2012.

21 siteresources.worldbank.org. What Zambia needs is to realise its potential.

22 http://en.wikipedia.org/wiki/List_of_countries_by_uranium_production .
23 http://issuu.com/oecd.publishing/docs/oecdobserver_no296_q3_2013 .
24 http://www.mbendi.com/indy/ming/af/bo/p0005.htm .

20
Table 2.2: Revenue from the mining sector in the SADC region (2010 - 2012)

Mining Mining Mining

Mining Mining Mining
GDP (bil- &quarrying &quarrying &quarrying
Country &quarrying &quarrying &quarrying
lion) (US$ bil- (US$ bil- (US$ bil-
(%) 2010 (%) 2011 (%) 2012
lion) 2010 lion) 2011 lion) 2012
Angola 113.7 53.33 46.90 53.89 47.40 53.89 47.40
Botswana 14.23 4.68 32.90 4.65 32.70 4.65 32.70
Democratic
Republic of 17.01
the Congo 1.91 11.20 2.09 12.30 2.09 12.30
Lesotho 2.43 0.19 7.80 0.23 9.50 0.19 7.80
Madagascar 9.98 0.02 0.20 0.05 0.50 0.05 0.50
Malawi 4.12 0.00 0.00 0.00 0.00 0.41 10.00
Mauritius 11.31 0.00 0.04 0.00 0.04 0.00 0.04
Mozambique 14.05 0.22 1.60 0.42 3.00 0.28 2.00
Namibia 12.9 1.17 9.10 2.15 16.70 1.48 11.50
Seychelles 1.02 0.00 0.00 0.00 0.00 0.00 0.00
South Africa 379.1 35.64 9.40 37.15 9.80 32.22 8.50
Swaziland 3.7 0.01 0.30 0.01 0.30 0.07 2.00
United Re-
public of Tan- 27.86
zania 1.00 3.60 1.00 3.60 0.89 3.20
Zambia 20.31 2.23 11.00 2.23 11.00 2.23 11.00
Zimbabwe 9.67 1.06 11.00 1.26 13.00 1.26 13.00
SADC 641.39 101.46 16.13 105.13 16.72 99.71 15.86
Source: SSY, 2012.

Mineral exports are a major contributor to the total export earnings of most Member States., In Bo-
tswana (2012), for example, the minerals sector accounted for 30 per cent of government revenue
and 85 per cent of foreign exchange earnings. Diamonds dominate exports in Botswana and ac-
counted for more than 70 per cent of total export earnings in 2013. In the case of Zambia, copper
remains the country’s mainstay, accounting for about 70 per cent of export earnings. In Namibia,
mining and quarrying accounted for 12.3 per cent of GDP in 2012 and 47 per cent of exports. Leso-
tho is an emerging mining country in the region where the mining sector, which is dominated by
diamonds, is gradually making a significant contribution to revenues and employment.

Table 2.3 shows some of the major minerals produced in the SADC region, their origin and the export
destination. Overall, the industry is export-oriented with limited value addition and linkages. Nearly
all minerals mined in SADC are exported, although South Africa exports some coal to Namibia while
the United Republic of Tanzania exports some tanzanite to South Africa. The report published by
the Organization of Economic Cooperation and Development, World Trade Organization and United
Nations Conference on Trade and Development (OECD, WTO and UNCTAD, 2013) reveals that the EU
imported large amounts of raw materials from the African, Caribbean and Pacific (ACP)-SADC coun-
tries while the SADC countries spent large sums of money to import finished goods. In addition to
importing expensive finished products and losing revenues owing to the export of semi-processed
goods and to externalisation by major mining companies, the ACP-SADC countries are also left with
environmental liabilities.

21
Table 2.3: SADC minerals and their main export destinations

Main mineral Source of minerals

Form of transport Main export destinations
resources SADC country
Botswana, South Africa, Zimbabwe,
Coal Railway, ship Namibia, India
Swaziland
Botswana, Namibia, South Africa, Canada, Switzerland, United King-
Copper Railway, ship
Zambia dom, Netherlands, China
Zambia, South Africa, Democratic
Cobalt Road, rail, ship India, United States
Republic of the Congo (DRC)
India, Israel, United States, Switzer-
Angola, Botswana, South Africa,
Diamonds Road, air land, Belgium, United Kingdom,
Namibia, Zimbabwe, Lesotho
United Arab Emirates
Zambia, United Republic of Tan-
Emeralds Road, air
zania
Tin Democratic Republic of the Congo United States
Iron Botswana, South Africa, Zimbabwe Road, ship China
Magnesium South Africa
Botswana, Namibia, Mozambique, India, Thailand, Malaysia, Japan,
Gold South Africa, United Republic of Road, ship China, Canada, United States, United
Tanzania, Zambia, Zimbabwe Kingdom, Turkey, Italy, Germany
Platinum South Africa, Zimbabwe Road, ship China, United States
India, China, Russia, United States,
Uranium Namibia, South Africa Road, ship
Iran
Silver South Africa Road
Tanzanite United Republic of Tanzania Air, road South Africa, India
Source: ECA, 2010.

The minerals sector in the SADC region is diverse in scale and extent, ranging from small-scale artis-
anal operators to highly mechanized mines. Some major large-scale investors in the SADC minerals
industry include25 Vale (Brazil-listed), Rio Tinto (United Kingdom and Australia-listed), BHP Billiton (Unit-
ed Kingdom and Australia-listed), Xstrata (United Kingdom and Switzerland-listed), Anglo American
(United Kingdom-listed), Barrick Gold (Canada-listed), and Vedanta Resources (United Kingdom-list-
ed). However, local participation in the large-scale minerals sector is highly limited owing to various
factors, which has implications for the sector’s direct contribution to domestic wealth creation and
retention.

In addition to these large-scale mining companies, the SADC region has a fairly sizeable and vibrant
small-scale mining sector26. As shown in table 2.4, an estimated 3.2 million people in SADC, who indi-
rectly support about 16 million SADC citizens, are engaged in the artisanal mining subsector. Globally,
an estimated 13 million people in about 30 countries are engaged in small-scale mining, with about
80 million to 100 million people depending on such mining for their livelihoods. As many as 650,000
women in 12 of the world’s poorest countries are engaged in artisanal mining, and between 1 million
and 1.5 million children are also involved in this subsector (Buxton, 2013). The artisanal small-scale
mining (ASM) sub-sector in the SADC region is dominated by both women and young people who
work in hazardous conditions. In most SACD countries, poverty and opportunism are major growth
drivers in this sector. Yet in most countries in the SADC region, a highly professional ASM sector oper-
ating within a legal and regulatory framework exists alongside illegal activities.
25 www.minesandcommunities.org/article.php?a=10891.
26 In this report, artisanal and small-scale mining will be used interchangeably and will signify mining involving the extraction of min-
erals with the simplest of tools, usually at a subsistence level.
22
Table 2.4: Estimated number of artisanal and small-scale miners in selected SADC Member
States

COUNTRY NUMBER OF MINERS WOMEN INVOLVED (%)

Angola *
150,000
Democratic Republic of the Congo 2,000,000
Malawi 40,000 10
Mozambique 60,000 30
Namibia 2,000 35
South Africa 10,000 5
United Republic of Tanzania 550,000 25
Zambia 30,000 30
Zimbabwe 500,000 >50
Total 3,192,000
Source: Buxton, 2013; Jerie, 2013
* www.ddiglobal.org

As noted in Buxton (2013), ASM includes legal, seasonal (permanent, seasonal, shock-pull and rush),
original (local, local migrant and foreign) and demographic (men, women, children, adults and aged).
. ASM can generally be classified into two major categories:(i) the mining and quarrying of industrial
minerals and construction materials and (ii) the mining of relatively high-value minerals, mainly gold
and precious stones27. The mining of industrial minerals including sand and gravel exists in every
country in the SADC region, and the output is mostly for the local markets.

The mainly informal nature of ASM limits the sector’s contribution to government revenues and of-
ficial export earnings. However, small-scale mining provides immediate, direct and local economic
benefits and, in some countries, small-scale mining production equals or exceeds that of the large-
scale mining industry. In China, for example, the small-scale mining industry produces 75per cent
of bauxite. In Indonesia, tin production by the small-scale mining sector equals that of large-scale
operators. In Brazil, small-scale miners produce 84per centof all construction and building materials
(Buxton, 2013).In Sierra Leone, furthermore, 80-90 per cent of diamond production is attributable to
artisans, while in Ghana almost 100 per cent of diamonds have been produced by artisans since 2008,
who also account for 18 per cent of gold production in the country (Estelle, 2012; ECA, 2011).

The miners and their families are exposed to harsh working conditions owing to poor working con-
ditions. Other challenges associated with ASM include: environmental degradation in agricultural
areas, and diseases. The absence of a legal or fiscal framework for small-scale mining and the use of
rudimentary production, processing and marketing techniques give rise to huge economic losses
in this sector. Furthermore, the extraction of aggregates can lead to the degradation of water body
basins, the loss of vegetation, the destruction of landscape, the generation of conflicts, the loss of
biodiversity and grazing land, and to dust pollution. Formalized and enforceable regulations for the
mining of sand and gravel could minimize land degradation and enhance the industry’s positive con-
tribution. In general, small-scale mining’s contribution to inclusive growth can be net negative if not
closely evaluated against the numerous negative outcomes associated with the industry.

Mining and inclusive growth

As noted earlier, the SADC region accounts for about two-thirds of Africa’s mineral exports by value
and is led by South Africa which, except for crude oil and bauxite, has almost all the mineral com-
27 www.ddiglobal.org/pages/artisanal-diamond.php.

23
modities essential for international competition. The discussion in chapter 1 referred to the failure
of buoyant economic growth in recent years, most of which is derived from the minerals sector, to
reduce poverty levels significantly. Figure 2.2 shows that inequality remains high in the region. Yet
mineral wealth represents a real opportunity to grow the local economy and tackle poverty and
other development challenges. The strategies focused on exploiting the role of this sector in inclu-
sive growth have to factor in the exhaustion of mineral resources and to ensure that the benefits are
invested into other forms of capital.

Figure 2.2: Comparison between national wealth and inequality in the SADC region

6.000
5.000
4.000
3.000
2.000
1.000
0.000
az a

An i
a

Za e
am ia

R
M lles

ts s
na

Ta nd

ag ia

N ar

Le ia

M o
aw
Bo itiu

Sw ric

th

Zi gol
bw

C iqu

D
n

oz mb
ib
c
So wa

ila

M nza

as

so

al
he

am
Af

go
r

ba

b
au
yc

on
m
ut

ad
Se

M
Inequality - Adjusted HDI (IHDI) GDP PER CAPITA (x 5000), US$

Source: Plot data from UNDP, 2013; www.cia.gov.

For sustainability, SADC countries have to make the conscious choice to invest in better health, edu-
cation, jobs and poverty reduction for their people as a route to deepening the contribution of the
sector to inclusive growth, as underlined in the Africa Mining Vision. This vision emphasizes strength-
ening horizontal and vertical economic linkages between the mining sector and national enterprises
and other economic sectors as key to deepening the role of mining on the continent. In terms of
the six areas of the resources value chain for the inclusive growth trajectory shown in table 2.5, the
global evaluation shows that (i) Botswana has developed not only a good fiscal policy, but also com-
petitiveness to capture/retain value from mineral resources and has transformed this value into long-
term development; (ii) Namibia has utilized mineral resources to develop good infrastructure; and
(iii) South Africa has used the value captured from minerals to invest in local content development
(Dobbs and others, 2013).

24
Table 2.5: Countries performing well across the six areas of the resources value chain

Source: Dobbs and others, 2013.

Challenges in the mining sector

One of the primary challenges in the mining sector relates to the collection and management of
mineral revenues owing to leakages and inefficient collection methods. First, the loss of potential
revenues incurred by the sector is attributable to the export of raw mineral products, which often
command low prices. There is also limited value addition to mineral products in most SADC Member
States. In addition, the trading arrangements of transnational corporations (TNCs) and poorly de-
signed fiscal policies further contribute to revenue leakages.

Export of raw and semi-processed minerals and mineral products: The export of raw materials
or semi-processed mineral products denies mineral-producing countries the benefits of higher pric-
es associated with finished products. For example, a SADC study (2000) showed that the unit value
of copper in a motor is 117 times the value contained in a cathode, the value is 38 times for iron in
fabricated tanks, six times for platinum in autocatalysts and 5000 times in polished diamonds. Further
losses can be averted via the economic benefits of linkages that could be created through domestic
value addition. For example, although Zambia is the world’s eighth largest copper producer, it is only
the 14th largest producer of refined copper owing to limited domestic capacity to add value to cop-
per (Das and Rose, 2014). The top refiners of copper in the world are rich countries who benefit from
value addition. South Africa is the only country in the region with a significant mineral-based manu-
facturing industry, exporting items such as copper and iron and steel-finished articles to other SADC
countries (Mutambara, 2013). Zambia produces and exports electrical cables and transformers28. Zis-
costeel in Redcliff, Zimbabwe used to produce steel but stopped operations in 2008 at the height of
the economic crisis, owing to a lack of capital to re-equip its plants29. Overall, value addition in the
region remains low, and this deprives the region of revenues for investment in inclusive growth.

28 www.elsewedyelectric.com/FE/Common/Companies.aspx?ID=35&g=3 .
29 http://www.thezimbabwean.co/business/industry/33685/ziscosteel-bankrupt-workers-starve.html.

25
For resource-based industrialization and job creation to take root, it is cardinal to facilitate the devel-
opment of linkages between the minerals sector and other sectors of the economy. These linkages
could be fiscal (resource rent capture and deployment/reinvestment), backward (upstream, i.e. min-
ing supplier industries), forward linkages (downstream, i.e. mineral beneficiation), knowledge (later-
al-stream, i.e. mineral human resource development and R&D) and spatial linkages (lateral-stream,
i.e. collateral use of mineral infrastructure and local economic development). Policy frameworks that
emphasize the development of local linkages are also important. Sweden, Finland, China, Malaysia,
Australia and, more recently, Chile and Brazil have all successfully utilized their natural endowment for
developmental purposes including technical training and technology development (R&D).However,
apart from South Africa, which has instituted clear local content policies, most SADC countries are
still developing such policies. Participation in regional and global value chains is an important feature
of the world economy, involving countries at all stages of development. The SADC region needs an
effective framework for participation in the global economy.

Trading strategies of multinational corporations (MNCs) and tax evasion: Furthermore, the
SADC region loses mineral revenues when investor TNCs confine cross-border trade of inputs and
outputs within their networks of affiliates, contractual partners and arm’s-length suppliers and when
under declaring mineral value to mineral host governments. According to OECD, WTO, and UNCTAD
(2013), an estimated 80 per cent of global trade is via TNC-coordinated trade. In addition, an estimat-
ed that more than $150billion a year is lost from Africa through tax avoidance by giant corporations
and through capital flight via banks, lawyers and accountants30.For example, it is estimated that Zam-
bia loses between US$1.5 billion to US$2 billion every year due to tax evasion and avoidance, main-
ly in the mining sector (Lundstøl, Raballand and Nyirongo,2013). Manley (2013) identifies transfer
pricing, underreporting, debt payments abuse and hedging as some of the ways used by investors
to avoid paying tax in mineral host countries. In the case of transfer pricing, companies reduce their
overall tax payments by selling goods and services from an operating unit in a low tax jurisdiction to
one in a higher tax jurisdiction at a relatively high transfer price. Income is therefore transferred away
from the high tax jurisdiction, where both taxable profits and tax payments fall and, correspondingly,
taxable income increases in the low tax jurisdiction. Consequently, the company’s overall tax bill is
reduced since the tax rate is lower in the tax jurisdiction. This is often difficult for governments to
monitor other than insisting on companies adhering to transfer pricing regulations. By underreport-
ing production values, the company declares lower values of mineral production, thereby reducing
revenues and so taxable income. In addition, the declared grades of the minerals mined may be
underreported, further reducing taxable income. Companies also take advantage of debt payments
through collusion by lending funds to subsidiary companies at a high rate of interest, thereby re-
ducing the subsidiary’s taxable profits resulting in lost revenues for the state. In the case of hedging,
mining companies reduce the impact of volatile prices on profits by purchasing derivative contracts
(e.g. futures and options), which guarantee a specific price for the companies’ output in the future.
Although this is a legitimate business strategy, it enables companies to shift income out of high tax
jurisdiction. Governments are often unable to take proper account of such transactions.

Poorly designed fiscal frameworks: Both the host country and investor strive to maximize value
from mineral resources which creates a form of ‘tug of war’ between the two parties. Investors in
developing countries often devise ways to skim money from the countries in order to maximize
profits. In Zambia, for example, mining investors were granted exemptions from paying the liabilities
accrued by former mines owner Zambia Consolidated Copper Mines (ZCCM),the pensions owing to
the mines’ workers, and benefited from tax exemptions for a given time period called the ‘stability
period’ as part of the conditions under privatization.

30 http://www.jersey.attac.org/TJN_in_Africa_Guardian_21.pdf..

26
Poorly designed mining agreements and limited capacity to negotiate contracts: Some
mineral-rich SADC countries, in the hope of attracting investment in the mining industry, offer lofty
development agreements and tax incentives for long periods such that hardly any tax is realised, as
shown in box 2.1 for Zambia. The privatization of Zambian mines was not linked to development ob-
jectives, including the strengthening of linkages between mining and other sectors of the economy
(Policy Monitoring and Research Centre (PMRC), 2013). Another challenge is related to the limited
reinvestment by investors, as all profits were externalized. Unlike ZCCM, which supported local pro-
ducers, the new mine owners depended on external suppliers for inputs, and so local benefits were
limited.

Box 2.1: Mining investment incentives in Zambia (PMRC, 2013)

In Zambia, the enactment of the Investment Act and Mines and Minerals Act 1995 included lenient terms based
on “Mining Development Agreements.” The latter allowed mining investors to be granted exemptions from paying
liabilities accrued by the defunct Zambia Consolidated Copper Mines (ZCCM); pensions owing to workers, and
arguably, most importantly, tax exemptions, for a given time period called the ‘stability period’. The mines thus paid
an aggregate tax (marginal effective tax rate) of 0per cent during this period.

Marginal effective tax by sector (1991-1999)

Das and Rose (2014) argue that the SADC region is losing significant revenues owing to limited ca-
pacity to control the revenue leakages. In addition, Lundstøl, Raballand and Nyirongo (2013) report
that while prices have improved, the development agreements that have placed mineral host coun-
tries at a disadvantage have remained static, thereby prejudicing countries generating significant
revenues.

Poor mining policies: Properly designed mining policies are key to the proper exploitation of min-
eral resources, as they express the government’s view on the role of the sector in development and
reduce the expectation of government in the conduct of the business of mining. Mineral resources
exploitation policies in SADC countries are inadequate on several fronts, as they are often silent on
key developmental expectations and thus fail to provide adequate guidance on inclusive develop-
ment issues. For example, key local development policy directions are the promotion of participation
by locals in the mining sector; local content; local linkages development; infrastructure development;
community consultations and community agreements; revenue sharing with communities; employ-
ment policies; training requirements; corporate social responsibility; and rural development. In ad-

27
dition, the policies are often silent on gender and young people in the SADC minerals industry and
in the promotion of meaningful participation by women and young people in the mining industry
through affirmative action-type programmes. The lack of policy direction on the creation and pro-
motion of local entrepreneurs denies countries the opportunity to benefit from local wealth creation
and local linkages.

Small-scale mining challenges: As noted earlier, small-scale mining activities are often located in
remote areas, making it difficult in some cases to apply the standard regulatory methods used for
large-scale mining industry. The enforcement of regulations is further hampered by the existence of
a large illegal ASM sector. Other challenges in the sector include: the displacement of local people,
the competition for labour with other economic activities such as agriculture, competition for water
supply and land itself (United Nations Environment Programme), Metals 2013). Sinkala (2009) ob-
serves that the poor working conditions in the gold sector expose miners to toxic chemicals such as
mercury vapour.

The contribution of ASM to inclusive growth has been minimal in the majority of cases mainly due to
illegality, poor mining methods, low value addition, poor access to mineralized ground, limited mar-
keting skills, loss of revenues due to operational inefficiencies, and to poor diversification of miners’
earnings into other more sustainable sectors, thus creating limited backward and forward linkages.
Furthermore, gender-related challenges impede the participation of women in the sector and hence
impact on inclusive growth. For example, access to finance requires collateral, which women may
not possess. The security, health, and social risks posed to women are particularly acute in war-torn
areas, such as in the east of the Democratic Republic of Congo (Franken and others, 2013; Hayes and
Burge, 2003). Other challenges to inclusive growth relate to the lack of sanitation in the country’s
refugee camps, malnutrition, and physical trauma induced by the difficulty of the manual labour. The
lack of proper mining skills and competences and the use of unsafe and environmentally-unfriendly
approaches that impact on the efficiency and sustainability of the sector both undermine its contri-
bution to inclusive growth. Furthermore, the nature of the product market also undermines the levels
of earnings obtained by the miners.

Other impediments to revenue optimization by small scale miners include high grading, which is
often designed to increase investor returns and shorten payback periods to overcome presumed
risks in some mining jurisdictions. High cut-off grades can also be due to poor mining technology or
sub-standard management of the mining process. The end result is the sterilization of mineral wealth
and the direct loss of potential revenue.

For the mining sector to contribute to inclusive growth, revenues from minerals must be prudently
invested in infrastructure, economic diversification, backward and forward linkages, and human re-
source development. This transformation of a wasting asset into other forms of capital contributes
towards sustainability and the continuation of economic activity beyond the currency of mining. An
efficient revenue collection and management system are therefore imperative.

Forest resources
Africa possesses 674.419 million hectares of forest cover, or about 17 per cent of the world’s total
forest cover. With 395.512 million hectares, SADC represents 9.8per cent of global forest cover and
58.50per cent of Africa’s forest cover, or 41per cent of the total land area of SADC Member States
(table 2.6). SADC-planted forest cover amounts to 3.4 million hectares (Naidoo, Davis and van Gard-
eren, 2013). Mozambique possesses 26.9 million hectares of forestry suitable for the production of

28
commercially valuable timber while Zimbabwe forests and woodlands constitute 42per cent of the
country’s total landmass (SADC/FAO, 2013).

Table 2.6: Forest cover in the SADC region

Country Total area Total land Forest cover Removal of wood products

Plantation
Land area
covered
(2005)

area
Industrial Woodfuel
roundwood
(Mln Ha) (Mln Ha) (x1000 Ha) (%) (Ha) 1000 m3 (x 1000 m3
overbark) overbark

Angola 124.67 124.67 58,480 47 128,000 1,260 4,108

Botswana
58.17 56.67 11,351 20 0 - 759
Democratic
Republic of the 234.49 226.7 154,135 68 59,000 205 81,580
Congo

Lesotho 3.04 3.04 44 1 10,000 Insignificant 2,362

3Madagascar 58.7 58.15 12,553 22 415,000 238 12,812

Malawi 11.85 9.41 3,237 34 365,000 598 5,919

Mauritius 0.204 0.203 35 17 15,000 10 7

Mozambique 79.94 78.64 39,022 50 62,000 1,507 19,233

Namibia 82.43 82.33 7,920 10 0 - -

Seychelles 0.0455 0.0455 41 89 5,000 10 3

South Africa 121.91 121.45 9,241 8 1,763,000 21,077 13,800

Swaziland 1.74 1.72 563 33 140,000 379 848

United Repub-
lic of Tanzania 94.73 88.58 33,428 38 240,000 2,661 24,970

Zambia 75.26 74.34 49,468 67 62,000 1,179 10,002

Zimbabwe 39.08 38.68 15,624 40 108,000 1,001 9,473

TOTAL = 986.2595 964.6285 395,142,000 18 3,372,000 28,865 181,009

Source: FAO, 2010a; Naidoo, Davis and van Garderen, 2013.

The forestry resources in the SADC region consist of both natural forest and plantation forests. The
SADC region contains 50per cent of the vegetation in Africa and is characterised by high rates of
endemism (>40per cent). The natural forest ranges from tropical moist forests in Angola and the
Democratic Republic of the Congo to scrubland and desert ecosystems in the Kalahari and Namib
deserts in western Botswana and southern Namibia (Naidoo, Davis and van Garderen, 2013). The for-
29
ests comprise six main forest types, namely miombo woodlands, mopane woodlands, baikiea wood-
lands, acacia woodlands, tropical moist forests, and mangrove forests. The forests contribute towards
the basic needs of communities and individuals in the form of fuel for cooking and heating, fodder
for animals, medicine, a resource for shelter and housing construction, mining support, treated poles
for power lines, material for furniture, curios and agricultural tools such as yokes and hoes. Non-wood
forest products such as medicinal plants, indigenous fruits, edible plants, edible insects, honey, bees-
wax, exudates and mushrooms are derived from forest resources. By quantity, industrial roundwood
and woodfuel are the most important products, while among non-wood forest products (NWFPs),
food and fodder are the most significant (FAO, 2010a). In addition to meeting the demands for wood
and a large range of NWFPs, forests provide income and employment to millions of people in SADC.
Forests also retain carbon and harness soils, playing a vital role in mitigating the effects of climate
change on the people and environment of the region.

Plantation forestry provides the raw materials for downstream activities such as sawmilling, wood-
chip exports, timber boards, furniture, mining timber, treated poles, charcoal, pulp and paper manu-
facture, and non-timber forest products. Plantation forests account for about 3.4 million hectares of
forest cover in SADC (Table 2.6), of which South Africa holds about 50 per cent, covering about one
(1)per cent of the country’s land area. Angola, Madagascar, Malawi, Mozambique, Swaziland, the Unit-
ed Republic of Tanzania and Zimbabwe have relatively small plantation forest sectors, most of which
are for industrial purposes such as wood pulp and timber and are privately owned. The expansion of
plantation forests in SADC countries is limited by the availability of suitable land and by water legis-
lation in some countries (Naidoo, Davis and van Garderen, 2013).

Contribution made by forest resources to SADC economies

The forestry sector is more amenable to addressing socioeconomic challenges than the minerals
sector for various reasons. The forestry sector is not as capital-intensive and is less specialized than
mining, and the skills required are not that sophisticated. The sector therefore offers the prospect to
contribute to inclusive growth by providing employment opportunities at both the artisanal and
industrial level.

At the global level, the market for forest products is projected to grow to US$1.2 trillion by 2054. Al-
though there are no disaggregated data on the contribution of timber-based industries to national
output in most countries, anecdotal evidence shows that the sector is a major contributor to eco-
nomic activity. Available data shows that, exotic forest plantations in South Africa contributed 1.8 per
cent to the country’s GDP and employed about 110,000 people (Swedish Trade Council, 2011). The
FAO report31notes that the forestry sector in Zimbabwe employed 14,500 people and contributed 3
per cent to GDP while its equivalent in Swaziland contributed 25 per cent of the country’s foreign
exchange earnings (Jasparro, 2009). From the Zimbabwe’s miombo woodlands, licensed timber ex-
ports reached around US$65 million in 2005 (4 per cent of the country’s total exports that year),
despite the low availability of commercial timber species (Naidoo, Davis and van Garderen, 2013).
FAO data show that forestry contributed US$25 million to GDP for Mauritius and US$9 million for the
United Republic of Tanzania in 2005 (FAO, 2010a). The FAO reports that SADC exported US$33.149
million of wood charcoal in 2005, 57 per cent of which was accounted for by South Africa. Charcoal
intra-SADC trade was US$699,000, 80 per cent of which was accounted for by Malawi.

The forest, timber, pulp and paper sector in South Africa contributes ZAR22 billion per year to GDP,
producing more than 22 million m3 of roundwood worth an estimated ZAR5.1 billion annually
(Naidoo and others, 2013). In Zambia, production of industrial roundwood from all forest types is

31 http://www.fao.org/docrep/005/ac850e/ac850e07.htm..

30
estimated to be 1.15 million cubic metres per annum with a value of US$ 12.2 million (Gumbo and
others, 2013). SADC exported timber worth US$110.875 million of which the Democratic Republic of
the Congo accounted for 70 per cent. There was also a US$7.592 million intra-SADC trade, 86per cent
of which were exports by South Africa (Wertz-Kanounnikoff and Wallenöffer, 2011).

Timber logging is officially done by both licensed large and small producers although there is also a
significant number of producers harvesting timber illegally. These small illegal producers often trade
their timbers to licensed timber dealers and traders, who also exceed their allocations and therefore
end up illegally trading the excess (Greenpeace, 2013).

Forest-based industries
The main classes of forest products harvested are wood and charcoal for energy, timber-based prod-
ucts, and non-wood forestry products.

Industrial round wood: Table 2.7 shows the volumes of industrial round wood (IRW) removal per
country between 2003 and 2007. The SADC countries with the highest timber production capacities
from natural forests include Angola, Madagascar, Mozambique and Zambia. At about 70per cent,
South Africa is the biggest producer of round wood and sawn timber in the SADC region.

Table 2.7: Industrial wood production and consumption in SADC

Product Production (Million m3) Consumption (Million m3) Lead countries

Industrial round wood 33 29 South Africa, Swaziland, Zimbabwe,
Democratic Republic of the Congo
Sawn wood 2.5 2.8 South Africa, Zambia, Zimbabwe
Wood panels 0.804 1.04 South Africa, Malawi, Zambia
Plywood and veneer 0.504 0.077 South Africa, Mozambique, Angola,
Democratic Republic of the Congo
Particle board 0.595 0.550 South Africa Zambia, Zimbabwe
Fibre board 0.152 0.410 South Africa
Wood pulp (tons) 1.969 1.566 South Africa, Swaziland, Zimbabwe
Paper &paper board (tons) 2.504 2.035 South Africa, Zimbabwe
Newsprint (tons) 0.458 0.321 South Africa, Zimbabwe
Printing paper (tons) 0.580 0.583 South Africa
Source: Imani Development, 2003

Wood and charcoal fuel: Wood fuel is the most important source of energy for many SADC coun-
tries due to the population’s limited access to electricity estimated at 24 per cent (IRENA, 2014), As
shown in Table 2.8, fuelwood, especially among rural communities, is the most important forest prod-
uct in many SADC countries. Seventy-five million people live in miombo regions, and an additional
25 million urban dwellers rely on miombo wood or charcoal as a source of energy (Naidoo, Davis and
van Garderen, 2013). The largest woodfuel consumers by volume (in m3) in the SADC region are the
Democratic Republic of the Congo (81 million), the United Republic of Tanzania (25 million), Mada-
gascar (19 million), South Africa (14 million), Zambia (10 million) and Zimbabwe (9.5 million) (table
2.9).

31
Table 2.8: Energy types and end-uses in SADC households
Income Strata Energy types Strategic ap-
Lighting Small power Cooking Space and water proach
heating
Poor-rural Wood Dry cell batteries Wood Wood Modernising
Poor-peri-urban/ Candles Recharageable Charcoal Charcoal traditional
urban penlight energy
batteries Coal Coal
Paraffin lamps Dry-cell Wood/Other Wood/Other
batteries biomass biomass
LEDs Car batteries Subsidised
Electricity
Incandescent Electricity
electric lights Paraffin
Middle-rural Electricity Car batteries Wood Wood Facilitating
energy transition
Electricity Charcoal Charcoal

Coal Coal
Small PV Small PV Paraffin
devices devices
Solar PV Solar PV Solar thermal SWH

Source: SADC, 2012a.

Table 2.9: Forest cover and wood harvest and value in SADC region for IRW and wood fuel
(2005)

Country Forest Cov- (IRW), NWFP value WOOD Jobs

fuel value

(US$ mln)
over bark
mln over
IRW val-
ue (US$

Wood
bark)

er (2010a) (x 1000 (US$ mil- FUEL

m3) lion) (x1000
m3)
Angola 58,480 1,260 4,108
Botswana 11351 759 10
Democratic 154,135 205 81,580
Republic of
Congo
Lesotho 44 2,362 8
Madagascar 12,553 238 5 12,812 8
Malawi 3,237 598 4 5,919 17
Mauritius 35 10 1 25 7 3
Mozambique 39,022 1,507 261 19,233
Namibia 7,290
Seychelles 41 10 3
South Africa 9,241 21,077 763 13,800 167
Swaziland 563 379 848
United Repub- 34,428 2,661 12 9 24,970 217
lic of Tanzania
Zambia 49,468 1,179 10,002 3
Zimbabwe 15,624 1,001 9,473 16
Total = 395,512 30,125 1,046 34 176,876 427 22
Source: FAO, 2010a.

32
Charcoal trade also offers opportunities for income generation through small-scale retail businesses
in urban areas run mostly by women. The consumption of charcoal is mainly in urban areas in the
SADC region. In Zambia, individual charcoal producers can earn an average of US$6000 per annum.
Charcoal production at the national level contributes significantly to the GDPs of Zambia (3.7%), Ma-
lawi (3%) and the United Republic of Tanzania (2.3%) and to household incomes (Gumbo and others,
2013). Kambewaand others (2007) estimated the annual value of the charcoal industry in the four
largest urban areas of Malawi to be about US$41 million. According to Kambewa and others (2007)
an estimated 92,800 people in Malawi depended on charcoal, including 46,500 producers, 12,500 bi-
cycle transporters, 300 ‘other’ transporters and 33,500 traders. Makhado and others (2014) report that,
in Mozambique, about US$200 million worth of charcoal is sold annually in urban areas primarily for
cooking. Data in table 2.10 and corresponding estimates in table 2.11 indicate that, collectively, an es-
timated 2.6 million people could be employed in the charcoal value chain, at a rate of consumption
of 2.5 kg/day for a five-member household.

Table 2.10: Charcoal demand and actors in the charcoal industry in selected SADC cities

Maputo Dar-es-Salaam Lusaka

Demand of charcoal, tons/year 130,000 440,000 250,000
Producers 20,000 54,000 37,000
Transporters 350 1,200 700
Retailers 20,000 70,000 40,000
Total employed 40,350 125,200 77,700
Employment/ton 0.31 0.28 0.31
Source: Maltitz, 2013.

Table 2.11: Employment in the SADC charcoal industry

Average number of people employed per ton consumed 0.3019

Average charcoal use per day for a 5-member family, kg/day 2.5
Cost per 2.5 kg charcoal, US$ 1
Annual charcoal consumption in SADC, tons ((3.4 billon $ x 2.5kg/$))/1000 8,500,000
Total employed (0.3019 x 8.5 million tons) 2,566,235
Source: Computed by T. Sinkala, 2014.

About 6 to 10 tons of woodare required for every 1 ton of charcoal produced, while consumers use
about 1 to 1.3 tons of charcoal per household per year (Lammers, 2012; Gumbo and others, 2013). As
a result, over-dependence on charcoal and wood for cooking makes these fuels among the agents
of deforestation and land degradation experienced in the region. With increasing population, land
degradation in SADC has the potential to negatively affect the contribution of natural resources for
livelihood and may drive many people into poverty.

There are differences however among the countries in the region, for instance, in the levels of bio-
mass-based fuel used. For example Malawi and Tanzania derive over 90 per cent of their energy from
biomass while Zimbabwe, South Africa and Swaziland get below 50 per cent each. In Malawi, about
140,000 tons of charcoal are produced per year but the country loses about 50,000 hectares of in-
digenous forest every year, which is reportedly the highest deforestation rate in the SADC region32.

32 http://connection.ebscohost.com/c/articles/36614387/charcoal-conundrum.

33
Non-wood forestry products (NWFPs): As noted earlier, these include medicinal plants, indige-
nous fruits, edible plants, edible insects, honey, beeswax, exudates, and mushrooms (Imani Develop-
ment, 2003). The value chain includes harvesters, transporters, traders, traditional healers, pharmacies,
restaurants and consumers. The importance of NWFPs for livelihood security, in particular for food
security and alleviating dietary deficiencies, and for assisting households to cope with poverty in the
region, is widely acknowledged. Both rural and urban population use NWFPs. Urban demand creates
markets for NWFPs, thus contributing to the potential for both urban and rural dwellers and traders
to earn income. Furthermore, the wild foods from forest plants and insects are highly nutritious and
could assist in meeting some of the nutritional requirements of people living with HIV/AIDS (Chidu-
mayo and Gumbo, 2010). In addition, NWFPs are linked to culture and identity and therefore contrib-
ute to building social capital. Despite the fact that many millions of poor people benefit from NWFPs,
their importance is generally poorly recognized and appreciated and sometimes even ignored in
terms of national policy and forest management (Chidumayo and Gumbo, 2010). Such neglect may
undermine the potential of these products to deliver benefits in the future, erode vital safety nets and
exacerbate poverty in Southern Africa. Worldwide, the estimated value of NWFP removals in 2005
was US$ 18.5 billion (FAO, 2010). Importantly, NWFPs complement agricultural income and serve as
safety nets during drought and civil unrest.

Inclusive growth components in SADC forestry policies

Appendix 3 synthesises policy components, which promote inclusive growth in the management
and exploitation of forest resources in the 10 SADC countries for which information could be ob-
tained. The need to accommodate access to forest resources by local communities and to involve
communities in the exploitation and management of forestry resources is recognized by all coun-
tries. Policy pronouncements to promote inclusive growth include the legal protection of traditional
users’ rights in all forests; the right for local people to manage community forests; revenue sharing
with local governing bodies; social responsibility clauses attached to concession contracts; protect-
ing basic fuelwood and the forest produce needs of local communities; community involvement in
the conservation of trees and forests in forest reserves and protected forest areas; the potential of
community natural resources management committees to source financial and technical assistance
from the private sector, NGOs and other organizations; the sustainable utilization of timber, fuelwood
and other forest produce; the marketing and sustainable utilization of forest produce; forest recre-
ation and tourism in forest areas; landuse practices with the best return on investment in abandoned
sugarcane fields; trade-offs between commercial and environmental conservation interests; gen-
der equality in employment opportunities, training and education, and decision-making; modern,
a competitive, efficient and well-regulated wood and non-wood processing industry in the private
sector; the efficient use of forest resources employing the best possible technologies, especially for
local value added processing; integrating forestry into existing farming systems to contribute to food
security and income generation; and heightening the awareness of the public to appreciate the role
forests play in their health and well-being.

However, the challenge always remains with implementation (Naidoo,Davis and van Garderen, 2013;
Kanounnikoff and Wallenöffer, 2011). Furthermore, tracking implementation is problematic given the
lack of quantitative benchmarks or targets. Generally, policies on gender and young people are weak
in all SADC countries, except for Mauritius, Namibia, South Africa, Zambia and Zimbabwe (gender)
and Zambia (young people).

34
Challenges in the forestry sector

Despite vast forest endowments, the SADC region is highly vulnerable to the negative impacts of
poor management in the forestry sector, which in turn negatively effects the sector’s contribution
to inclusive growth. The major challenges in the forestry sector include; weak institutional frame-
works to support the coordination and implementation of national forestry sector policies; the lack
of a land policy by some countries (e.g. Swaziland); competing land uses resulting in the loss of
forestry resources; poor infrastructure to support the forestry sector; limited credit opportunities for
rural communities to meaningfully participate in the forestry sector; pressure from rapid population
growth and urbanization, which accelerates forest resource depletion; limited skills in value addi-
tion to forestry products; and limited forestry technical capacity and research in support of inclusive
growth. For example, the wood and charcoal fuel industry in the SADC region is characterized by low
levels of capital inputs, limited technical knowledge, and the use of unskilled labour. Yet the pillars of
the downstream industry in the sector include skills, technology and financing, which are lacking in
the region. While some countries such as Mauritius, South Africa and Zambia have policy pronounce-
ments on downstream processing, there is inadequate investment in the production of internation-
ally competitive timber products in most SADC countries – apart from South Africa– thereby leading
to the loss of business opportunities.

Furthermore, illegal wood harvesting and uncontrolled charcoal production also impact on the ca-
pacity of the SADC region to maximize revenues from wood-based forestry resources. Minten, Sander
and Stifel (2013) estimate that, for example, forgone tax revenues from clandestine charcoal produc-
tion and trade in Tanzania, Kenya and Malawi are about US$ 100 million, US$ 65 million and US$ 7
million, respectively. Deforestation is also a major challenge to sustainability in the forestry sector and
has been identified as one of the priority areas for regional action due to its contribution to increased
concentrations of carbon dioxide in the atmosphere and to land degradation and its negative impact
on biodiversity and the balance of associated ecosystems (Naidoo, Davis and van Garderen, 2013).
The drivers of deforestation include agricultural expansion, woodfuel harvest (including charcoal
production), hardwood timber extraction and conversion of natural forest to commercial plantations.
The region has been losing forestry resources owing to human and industrial activities. Naidoo, Davis
and van Garderen (2013) report that during the period from 2005 to 2010, annual net forest loss in the
SADC region was estimated at 1.8 million ha (0.46 %), with Tanzania, Botswana, Namibia and Malawi
suffering the highest rates of deforestation (figure 2.3). During the same period, Mauritius reported
annual rates of deforestation of 0.06 per cent while South Africa and Seychelles reported no defor-
estation at all. Swaziland and Lesotho reported a positive net gain in forest cover in the same period.

35
Figure 2.3: Annual rate of deforestation in SADC countries (2005–2010)

Source: Naidoo, Davis and van Garderen, 2013.

Wildlife resources and tourism

SADC has the largest variety of animals in the world. It is home to more than 800 bird species, 150
mammal species, about 50 snake and lizard species, 11 tortoise species and thousands of inverte-
brate animals like insects and arachnids33. Protected areas in SADC comprise approximately 20per
cent of the region’s land area, with a high proportion (>72%) lying across international boundaries.
These areas support a very vibrant nature-based tourism sector that has become the third largest
contributor to regional GDP after mining and agriculture34. The region has an estimated 10,000 to
14,000 private ranchers who promote wildlife enterprises alone or in combination with domestic
livestock (Child and others, 2012). Although there is limited information on private conservation ini-
tiatives, it is estimated that a minimum of 14 million hectares of private land is under some form of
wildlife protection or sustainable wildlife management (Krug, 2001). This is equivalent to almost half
the size of all state-protected areas in the SADC Region. SADC Member States recognize the impor-
tance of conservation and the sustainable use of wildlife resources in the region and have signed a
protocol to maximize the benefits from wildlife resources (SADC, 1999).

Tourism, wildlife and SADC economies

Wildlife is vital to SADC because, apart from tourism, it supports local communities in several import-
ant ways, including traditional uses such as food and clothing. The industry has become increasingly
important as a generator of benefits to government, the private sector and communities. For exam-
ple, Botswana has over 35 community and development trusts active in community-based natural
resources management (CBNRM), 64 registered conservancies in Namibia (covering 17per cent of
the national land area), 69 community resources boards in Zambia, 56 rural districts in Zimbabwe,
and at least 8 parks in Mozambique35.

33 http://www.places.co.za/html/saanimalgr.html.
34 http://wwf.panda.org/what_we_do/where_we_work/project/projects_in_depth/cbnrm/challenges/ .
35 wwf.panda.org/what_we_do/where_we_work/project/projects_in_depth/cbnrm/benefits/.

36
The stakeholders in the wildlife and tourism sector include; frontier service providers; internation-
al and local tour operators, travel agents, transport operators, logistics companies; accommodation
providers; and ancillary service providers (Foreign Investment Advisory Service (FIAS), 2006).

Generally, tourism is a growing economic sector in the region. The World Bank data (table 2.12) show
that tourism contributed an average of US$15.35 billion for the period from 2006 to 2010. Data from
the World Travel and Tourism Council (table 2.13) show that 5.7 million direct and indirect jobs were
created in the tourism industry in 2011, which were projected to reach 5.9 million jobs in 2012.In
2011, tourism contributed 60.8 per cent to the GDP of Seychelles and 28.6 per cent to that of Mauri-
tius. The contribution made by tourism to GDP was lowest for Angola at only 2.3 per cent.

Table 2.12: Tourism receipts and jobs in SADC

Table 3.15a: Tourism receipts for SADC countries Table 3.15b: Tourism direct and indi-
rect jobs, and contribution to GDP
COUNTRY US$ (million) 2011 2012 (projected)
TOTAL TOTAL
2006 2007 2008 2009 2010 JOBS JOBS
GDP GDP
Angola 91 236 293 554 726 1,188,000 8.6 1,226,000 8.94
Botswana 539 501 555 230 222 45,000 6.5 49,500 7.06
Democratic
Republic of the 3.10 0.70 0.70 24 10.70 291,000 2.3 280,000 2.19
Congo
Lesotho 29 31 30 30 25 71,500 14.3 78,500 15.77
Madagascar 386 506 620 518 633 577,000 14.9 642,000 16.63
Malawi 45 43 43 46 45 162,500 6.1 169,500 6.46
Mauritius 1,302 1,663 1,823 1,390 1,585 151,500 28.6 159,500 30.80
Mozambique 145 182 213 217 224 562,000 7.0 558,000 7.23
Namibia 473 542 484 511 560 116,000 20.3 120,000 21.58
Seychelles 323 396 408 349 352 25,500 60.8 24,500 60.80
South Africa 9,211 10,226 9,178 8,684 10,308 1,188,000 8.6 1,226,000 8.94
Swaziland 75.10 32.20 26.30 40.10 51.40 13,000 4.0 12,500 3.86
United Republic
986 1,215 1,293 1,192 1,279 1,182,500 13.3 1,209,500 14.10
of Tanzania
Zambia 110 138 148 98 125 58,000 5.0 59,000 5.35
Zimbabwe 338 365 294 523 634 93,500 11.7 96,500 12.31
Total = 14,056.20 16,076.90 15,409 14,406.10 16,780.10 5,725,000 5,911,000 .8

Sources: http://data.worldbank.org for table 3.15(a), and www.wttc.org for table 3.15(b)

Continent-wide, the tourism sector generated US$163.9 billion in 2011. The SADC region accounted
for 36.14 per cent of the African continent’s total earnings. Furthermore, the region also accounted
about 30 per cent of the jobs created in this sector. Given its resource base, however, the region has
potential to generate even more in the sector.

37
Table 2.13: Contribution of the SADC tourism industry to regional GDPs compared to Africa
and the rest of the world

2011 2012 (Projected)

Tourism con- Tourism con-
Region GDP
tribution to Percentage tribution to Percentage
(US$ Jobs Jobs
GDP of GDP GDP of GDP
billion)
(US$ billion) (US$ billion)
SADC 629.06 59.24 9.42 5,725,000 61.99 9.85 5,911,000
Africa 163.90 8.70 18,751,000 170.13 9.03 19,239,500
World 6,346.10 9.10 254,941,000 6,523.80 9.35 260093000

SADC % of
36.14 30.53 36.44 30.72
Africa
SADC % of
0.93 2.25 0.95 2.27
World
Sources: http://data.worldbank.org and www.wttc.org.

Potential of tourism and wildlife to contribute to inclusive growth

Tourism and wildlife is a powerful catchment industry for the pursuit of inclusive growth in the re-
gion. The region can use participation in the tourism and wildlife as strategies for inclusive growth
and rural economic development. Income from wildlife has contributed to social projects, provided
cash to households in some projects, and helped to empower local people especially where com-
munities participate (Child and others, 2012, International Union for Conservation of Nature (IUCN),
2005). In 2007, for example, community-based natural resource management activities in Namibia
generated US$5.4 million, of which US$ 2.9 million went to communities as their share of revenue.
Malawi realized US$ 0.5 million in 2006, and Zimbabwe earned US$ 2.3 million in the same year with
US$ 1.2 million going to communities.

Existing policy components for tourism and wildlife to contribute to inclusive growth

Wildlife constitutes part of SADC’s tourist attraction but requires conducive policies for it to contin-
ue to sustainably contribute to inclusive growth. The participation of local people in tourism devel-
opment is key to tourism development. Appendix 5 summarizes policy components on inclusive
wildlife resource exploitation and management in a sample of five selected countries from the SADC
region, including Angola, Botswana, Namibia, Zambia and Zimbabwe who are partners in the Ka-
vango Zambezi Transfrontier Conservation Area. Although crafted differently, all countries generally
recognize the need for inclusive wildlife exploitation and management. Angola is planning to revise
pro-colonial legislation in order to address the current situation. Some of the pro-inclusive growth
policy pronouncements include: the protection, conservation and propagation of wild animal life
and indigenous vegetation for the benefit and enjoyment of the public; the involvement of com-
munities in the management of protected areas; the provision of adequate compensation for the
displacement of people; the creation of jobs for locals and the integration of traditional knowledge
about the conservation of biological diversity together with scientific knowledge. If fully implement-
ed, these policy components would have made a significant contribution to deepening the role of
the sector in generating inclusive growth in the region.

38
Challenges to inclusive growth in the tourism and wildlife sectors

Although existing policies contain some elements in support of inclusive growth in the tourism and
wildlife sectors, the pronouncements do not however have quantitative benchmarks or targets nec-
essary for monitoring and evaluating any measurable progress made. There are also several challeng-
es hindering inclusive growth in the tourism and wildlife resource-based industries.

In the tourism value chain, tour packages are sold by operators either in the regional market or out-
side SADC as an add-on package to tourists in other African countries, thus putting national oper-
ators at a disadvantage. For example, a Quirimbas case study in Mozambique revealed that, for the
Lisbon-Bazaruto tourism value chain, domestic intermediaries such as Mozambican tour operators
and travel agencies and other ground operators including ground transport organizers, taxi cabs, car
rental agents) play a very insignificant role and do not gain much business from the value chain (FIAS,
2006). The main economic agents that influence the costs and value of a tourism product in this
segment of the market are the South African intermediaries, the regional or domestic airlines that fly
to Pemba, and the hotel/resorts. These economic agents account for 19.2per cent, 16.4per cent and
64.4per cent of the published package price, and 15.5per cent, 15.1per cent, and 51.7per cent of total
tourist expenditures respectively, leaving very little for the countries hosting the tourist attractions.

Other challenges hindering an effective contribution of the tourism and wildlife sectors to inclu-
sive growth include rivalry between conservation programmes and already established institutions
tasked with wildlife conservation, for instance, between Zambia Wildlife Authority (ZAWA) and the
Community-Based Natural Resource Management and Sustainable Agriculture programme in Zam-
bia (Lyons, 2012); gaps between project goals and what people living in their own communities
actually want, which are created largely by the project design or restricted funding objectives (Lyons,
2012);inadequate information or publicity about wildlife conservation projects and programmes;
poor skills for communities to meaningfully participate in wildlife conservation projects, resulting
in a poor quality service when locals participate (FIAS, 2006); inadequate local marketing skills by
local tourism agents to package affordable tours in competition with international tour agents (FIAS,
2006); limited resources to develop projects to fully blown commercial levels; lack of transparency in
wildlife conservation projects and the tourism hunting management system; unfair benefit distribu-
tion formula such that benefits secured from wildlife for host communities are on a net basis lower
than traditional livelihood activities for the same level of community effort; and inadequate public
participation, consultation and access to information in the wildlife sector, including during the de-
velopment of government policies and regulations.

SADC water resources

The region hosts about 21.6 million hectares of inland and marine water resources (table 2.14), and
these water bodies sustain a rich diversity of natural ecosystems and are important for meeting basic
needs such as water supplies for domestic and industrial requirements. Among other uses, water
contributes to food security, improves access to and the availability of energy via hydropower (both
at macro and micro-levels) and provides employment. Shared watercourses also generate regional
economic benefits. For example, the Zambezi Basin has eight regional Member States, providing
a source of livelihood along the river’s course and catchment area. Similarly, as noted by Sakibede,
(2012), the 10 countries (four in SADC) of the Congo Basin also derive livelihood from the Zambezi
basin. In this way, shared water resources can contribute to inclusive growth when managed in a ho-
listic manner. The regional policy on the management of transboundary water resources adopted in
2005 provides a framework for cooperation and for the holistic management of the water resources.

39
Table 2.14: Water resources in SADC

Country Population Total area Total land Total water Inland water
Million Million ha Million ha Million ha X 1,000 ha
Angola 18,565,269 124.67 124.67 0 0
Botswana 2,127,825 58.17 56.67 1.5 1,500
Democratic Republic
75,507,308 234.49 226.7 7.78 50
of the Congo
Lesotho 1,936,181 3.04 3.04 0 0
Madagascar 22,599,098 58.7 58.15 0.55 550
Malawi 16,777,547 11.85 9.41 2.44 2,440
Mauritius: 1,322,238 0.204 0.203 0.001 1
Mozambique 24,096,669 79.94 78.64 1.3 1300
Namibia 2,182,852 82.43 82.33 0.1 100
Seychelles 90,846 0.0455 0.0455 0 0
South Africa 48,601,098 121.91 121.45 0.46 462
Swaziland 1,403,362 1.74 1.72 0.02 16
United Republic of
48,261,942 94.73 88.58 6.15 6,150
Tanzania
Zambia 14,222,233 75.26 74.34 0.92 922
Zimbabwe 13,182,908 39.08 38.68 0.39 391
Total = 290,877,376 986.2595 964.6285 21.611 13.882
Source: www.cia.gov.

Water resources significantly vary in distribution, availability and usage across the SADC region. Ac-
cording to the SADC Regional Infrastructure Master Plan, there is an estimated total of 2,300 km3/year
of renewable water resources available to the region (SADC, 2012b). The current level of abstraction is
only 44 km3/year or 170 m3/capita/year, as shown in table 2.15. Of the 44 km3/year abstracted, 77per
cent is used for irrigation, 18 per cent for domestic purposes while five per cent is used by industry.
If the storage of the Kariba and Cahora Bassa dams is excluded, only four per cent of the total annual
renewable water resources in the SADC region is currently stored for various uses, which is very low
compared to 70-90per cent in most industrialized countries. If the storage of Kariba and Cahora Bassa
dams is included, 14 per cent of the total annual renewable water resources in the SADC region is
currently stored for various uses. Table 2.15 shows that the region is not making optimal use of its
water resources for various reasons.

40
Table 2.15: A summary of comparative water storage and abstraction

Sector SADC status  World averages Developed world status

Water abstraction 170 m3/capita/year
Surface water stor-
14% of stored ARWR
age
7% irrigated of the available
Irrigated land
irrigable land.
61% of SADC population
Water has access to an adequate
and safe water supply
39% of SADC population
Sanitation has access to an adequate
sanitation service
ARWR = Actual Renewable Water Resources
Source: SADC, 2012b.
570 m3/capita/year
25% of stored ARWR
20% irrigated of the available
irrigable land
96% of the urban population
and 81% of the rural popula-
tion in the world had access
to improved sources of drink-
ing water in 2010
79% of the urban and 47%
of the rural population in the
world (2010) had access to
improved sanitation facilities
in 2010
1,330 m3/capita/year
70% to 90% of stored ARWR
70% irrigated of the available
irrigable land
100% of the population has
access to an adequate and safe
water supply
100% of the population has
access to an adequate sanita-
tion service

The regional Master Plan for the water sector for the period up to 2027 includes a number of pro-
grammes that focus on hydroelectric power for energy security and economic development, water
supply and sanitation for poverty reduction, and irrigation for food security, thereby addressing the
gaps in the 2027 targets shown in Table 2.16.For example, an additional 11 per cent of water storage
capacity is required to meet the 2027 target. For water use in the agricultural sector, an additional 13
per cent is required to meet the regional target. These projects could be pursued through public-pri-
vate partnerships. The interventions will create new jobs in direct water consumption/user sectors
such as agriculture (a significant job creator), hydropower generation, water transport, and domestic
water supply and sanitation services, as well as other industries such as information and communica-
tions technology and tourism, thus increasing incomes and contributing to inclusive growth.

Table 2.16: Water sector vision 2027 target

SECTOR CURRENT STATUS VISION 2027 TARGETS

Surface water storage 14% of ARWR stored (includes Kariba
and Cahora Bassa dams)
Agriculture 3.4 million hectares (7% of potential)
irrigated
Hydropower 12 GW (8% of potential) installed
Water supply 61% of 260 million people served
Sanitation 39% of 260 million people served
Water abstraction 44 km3/year abstracted
Source: SADC, 2012b.
25% of ARWR stored to meet SADC regional
demand. Eventual target is 75% stored, as
world benchmark is 70-90% of ARWR stored.
10 million (20% potential) hectares irrigated.
World average is 20%.
75 GW (50% of potential) installed to meet
SAPP targets and exports to other RECs
75% of 350 million people served. Eventual
target is 100% served.
75% of 350 million people served. Eventual
target is 100% served.
264 km3/year abstracted to meet expected
increase in water demand.

Water and agriculture: Water is key for agricultural activities. According to UN-Water (2013), the hu-
man population is projected to increase globally from a current 7 billion people to nine billion people

41
by 2050. This situation will require 60 per cent more food and an increase by 19 per cent of agricultur-
al water consumption (including both rain-fed and irrigated water). Of accessible water, 70 per cent
is abstracted for agriculture, 20 per cent for industry and 10per cent for domestic use. Every day, each
person drinks two to four litres of water and eats 2,000 to 5,000 of virtual water embodied in food.

As shown in Table 2.1, only seven per cent (3.5 million hectares) of potential irrigable land is irrigated
in the SADC region. This share is much lower than the global contribution of 20 per cent and de-
veloped countries’ share of 70 per cent. The region plans to raise this proportion to 20 per cent (10
million hectares) by 2027. Such an intervention will open up opportunities for inclusive growth in the
sector. Investment in water harvesting, storage and irrigation infrastructure will invariably increase
opportunities in agriculture, generate employment and contribute to addressing food insecurity. The
rural poor can be empowered with skills and financial capacity for improved use of water resources
such as irrigation systems and dam construction for aquaculture and other uses.

Water and energy: Water can be a source of renewable energy. Many small communities in SADC
lack electricity even in countries with extensive grid electrification. This situation could be addressed
through the development of stand-alone mini-hydro stations, which could provide power for pro-
ductive and consumptive uses. Such decentralized systems can be useful for the supply of education
and health facilities. For mini-hydropower generation, the water flow required is small, and there are
many such sites in the SADC region which are amenable to such infrastructure. With the appropri-
ate policies in place, the low levels of technology and financial requirements for small hydropower
generation present ready opportunities for inclusive growth in the region where suitable sites exist.

Water and gender: In Africa, 90 per cent of the work of gathering water and wood is carried out by
women and girls (and they often spend up to six hours every day fetching water (UN Water, 2013). A
study36 in Tanzania revealed that reducing the distance to a water source from 30 minutes to 15 min-
utes increased girls’ school attendance by 12 per cent. With the same access to productive resources
including water as men, women could increase yields on their farms by 20-30 per cent and lift 150
million people out of hunger. Involving women can increase the effectiveness of water projects six-
to sevenfold. Improved water management is cardinal in reducing time wastage by women, thus
increasing their role in other activities.

Water and biodiversity: Freshwater contains over ten per cent of all life and 35 per cent of all ver-
tebrates on the planet and supports all terrestrial biodiversity. The SADC region has significant rich
aquatic species, some of which are unique. For example, the Okavango and Chobe river areas in Bo-
tswana are the richest floral areas in Southern Africa, and Lakes Tanganyika and Malawi have a great
variety of fish species.

Freshwater ecosystems provide a vast array of services to society including food, water, wood and
fibre, fuel, nutrient recycling, soil formation, primary production, habitat provision, spiritual, aesthetic,
educational and recreational functions, climate regulation, flood regulation and water purification.
A well-functioning watershed with its forests, grasslands and soils, and wetlands including water-
courses, lakes, swamps and floodplains provides water storage, clean water, flood flows management
and many other benefits that are crucial for inclusive growth, as they affect the whole or parts of
socioeconomic life. By providing these opportunities, water resources thus offer avenues for jobs and
incomes to communities.

Water and disasters: Floods, droughts and windstorms have been the most frequently occurring
disaster events since 1900. They account for 85.5 per cent of the thousand most disastrous events.
36 http://www.unicef.org/esaro/7310_Gender_and_WASH.html.

42
Since 1900 more than 11 million people have died as a consequence of drought, with more than 2
billion people being affected by drought – more than any other physical hazard. During the period
from 2000 to 2006, a total of 2,163 water-related disasters, which killed more than 290,000 people, af-
fected more than 1.5 billion people and inflicted more than US$422 billion of damage, were reported
globally in the Emergency Disasters Database (UN Water, 2013).

The SADC region has developed a project to pilot a synchronized and conjunctive operation for
the Zambezi River Basin to mitigate flood and drought, improve livelihoods and provide water for
the environment (SADC, 2012b). Another SADC project (see box 2.2) based in Zambia is focused
on monitoring climate change adaptation to drought for enhanced knowledge for the purposes
of replication in the SADC region. Other efforts include drilling boreholes and damming to mitigate
the impacts of drought and disasters. These projects not only develop capacity to deal with water
disasters and droughts, but also help minimise negative impacts on inclusive growth programmes.

Box 2.2: SADC project on monitoring climate change adaptation to drought Agro ecolog-
ical Region I, Zambia (SADC, 2012b).
The overall objective of the Climate Change Adaptation to Drought Project is to reduce the vulnerability
of those depending on rain-fed agricultural practices to anticipate rainfall shortages in the face of climate
change or climate variability. Agroecological Region I (AER I) in Zambia covers the western and southern
parts of the country and receives less than 800 mm of rain annually. This project focuses on the introduction
of irrigation and water management systems, training, capacity-building of farmers for water management
practices, support to marketing and the provision of finance and credit facilities. It also supports the intro-
duction of drought resistant crops such as cassava, beans, sorghum, millet, potatoes, vegetables and fruit
trees. The project entails the construction of five dams at five selected areas in AER I, with eight fishponds
per site and irrigation schemes at these five separate locations.

Water resources management in the SADC region

The SADC region is committed to the equitable and sustainable utilization of water for social and
environmental justice, regional integration and economic benefit for present and future generations
and has developed programmes to manage regional water bodies. The region is endowed with15
basins shared within the region (e.g. the Limpopo and Zambezi river basins) and with non-SADC
countries (such as the Congo and Pangani river basins), for which various joint authorities exist to
manage them37. Hence, management of the shared watercourse has both national and regional di-
mensions. The Zambezi is the single largest shared watercourse in SADC covering eight countries
and is an important contributor to the socioeconomic and environmental development in these
countries. Cooperative management is therefore important and will contribute to the SADC goal for
the attainment of an integrated regional economy on the basis of balance, equity and mutual benefit
for all SADC Member States, and thus help the region achieve inclusive growth (SADC/Zambezi River
Authority, 2008).An Integrated Water Resources Management (IWRM) strategy was formulated within
the framework of the Zambezi River Action Plan to achieve environmentally sound planning and the
management of water and related resources in the Zambezi Basin. This strategy captured the South-
ern Africa Vision for Water, Life and the Environment in the 21st Century developed and adopted by
SADC as a contribution to formulating the Africa Water Vision 2025. The Southern Africa IWRM vision
is supported by action areas that promote inclusive growth of the region. These action areas include
social and economic development; equitable access to water of an acceptable quantity and quality;
proper sanitation for all and safe waste management; food security for all; energy security; a sus-
tainable environment; security from disasters; and the development and management of integrated

37 www.icp-confluence-sadc.org/documents.

43
water resources. The Action Plan needs to be strengthened with benchmarks and a corresponding
monitoring and evaluation framework.

Contribution of water resources to SADC economies

Water directly and indirectly contributes to the SADC economy in its various uses. Major uses of water
in the SADC region are aquaculture, mining, irrigation, domestic and livestock uses, manufacturing,
hydro and thermal power generation, navigation, and recreation and environmental flows. However,
data on the direct contribution of water to SADC economies is scarce. The region has commissioned
pilot projects at national and river basin levels on economic accounting for water (SADC, 2010). This
will be handled through key institutions such as Departments of Statistics, Water Affairs, Environ-
ment, Meteorological Services, Agriculture, Water Boards, Water Utilities, Finance and Economic Plan-
ning. The economic accounting of water is fundamental to planning and implementing national
and cross-border programmes so that the water sector can contribute effectively to inclusive growth
(SADC, 2010).For example, Zambia is relatively amply endowed in terms of water resources, com-
pared to other countries in the region. Renewable water resources per capita in the country are
about 8,700 m3/year, which is above the SSA average of 7,000 m3/person/year and the global aver-
age of 8,210 m3/person/year38. These resources are, however, underdeveloped. Indicators relating to
the economic accounting of water can isolate areas and levels of investment in the water sector to
raise its contribution to inclusive growth (SADC, 2010). For a country like Namibia that experiences
frequent droughts and for which the most important source of water is groundwater, which consti-
tuted 38per cent of annual freshwater use39in 2000, the economic accounting for water plays a big
role in making an informed allocation of water, a scarce resource, among competing users.

The fisheries sector

The economic contribution of the water sector to SADC economies can be derived from activities
that are directly dependent on water resources such as fisheries, aquaculture and recreation. SADC
has a total of eight coastal states including Angola, the Democratic Republic of the Congo, Mauritius,
Mozambique, Namibia, Seychelles, South Africa and the United Republic of Tanzania, and living ma-
rine resources including migrating fish stocks are shared between two or more countries. Southern
Africa boasts a diverse fishing community comprised of small-scale and industrial-scale fisheries tar-
geting a diverse array of species for local and international consumption. Marine harvest trends indi-
cate a decline in most marine stocks since 1972 for the majority of countries in the Southern African
region (World Wildlife Fund (WWF), 2011).

As evident from table 2.17, the contribution made by the fisheries sector to GDP varies in SADC Mem-
ber States, ranging from 0.05 per cent of GDP in South Africa to 8per cent in Madagascar (table 2.17).
Excluding the Democratic Republic of the Congo and Zimbabwe, for which data could not be found,
total direct and indirect employment is about 1.8 million. In South Africa, about 500,000 people also
engage in recreation fishing, with the country recording a capture of 16,000 tons of line fish in 2003.

In 2012, the world produced a record 128 million tons of fish for human food– an average of 18.4 kg
per person – providing more than 4.3 billion people with about 15 per cent of their animal protein
intake. Fisheries and aquaculture are also a source of income for 55 million people40. However, it is
estimated that one in four fish in Africa is caught illegally (NPCA, 2013b) and that specific losses to
African economies could be around US$ 6-7 billion per year (Boto and others, 2012). Developing
38 www.sadcwateraccounting.org/pilot+projects/2.4Zambia.aspx .
39 www.sadcwateraccounting.org/pilot+projects/2.3Namibia.aspx .
40 www.fao.org/news/story/en/item/150839/icode/.

44
countries are most at risk from illegal fishing, with total estimated catches in West Africa being 40per
cent higher than reported catches.

Aquaculture is probably the fastest growing food-producing sector worldwide. Global aquaculture
production increased from 47.3 million tons in 2006 to 60 million tons in 2010, with an estimated
total value of US$119 billion. It is estimated that worldwide aquaculture contributes approximately
35 per cent of total fish production, although aquaculture supplies only around three per cent of
fish production in SSA. Aquaculture is an important economic activity that has hitherto not made
full use of available water resources in the region. Globally, it is often regarded as a great opportunity
to improve food security and livelihood and to provide further income. In rural areas, it can be easily
integrated into farmers’ primary agricultural activities, and products can be sold at the farm gates or
local markets and thus provide another source of income that diversifies farmers’ income streams.
Aquaculture production in the region is concentrated in Madagascar (black tiger shrimp), Tanzania
(seaweed), Mozambique (shrimp), Namibia (shrimp) and South Africa (abalone). In 2004, aquaculture
production in the region accounted for 0.14 per cent (US$97.556 million) of total global aquaculture
production of US$71,670 million (TIPS and AUSAid, 2007).

Table 2.17: GDP contribution and employment by the fisheries industry in selected SADC

Country Contribution to GDP (%) Employment

Angola 3.5
Mauritius 1.5 12,000
Madagascar 8 (in 2005) *
100,000 direct jobs (in 2005)
Malawi 4 60,000 (directly and 350,000 (indirectly)
Mozambique 4 (in 2008), of which 0.3 aqua-
140,000 (directly) and 500,000 (indirectly).
culture
Namibia 13,400 direct (in 2008), 13,380in 2013 and 135,000 indi-
6.5 (3.9 in 20125)
rect
Seychelles 7.7 5,000 in 2011, (about 11% of total formal employment)
South Africa (WWF In 2008, commercial fishing industry employed 43,458
2011; Department of 0.05 (commercial fisheries only, persons: 27,000 directly and 100,000 indirectly em-
Agriculture, Forestry and 2008) (FAO, 2010b) ployed. Also, about 500,000 people participate in recre-
Fisheries, 2012) ational fishery.
United Republic of Tan-
1.3
zania
Zambia 3.3 (in 2008) 300,000 (directly and indirectly)
Source: ACP Fish II, 2013; WWF, 2011; DAFF, 2012.
*. www.stopillegalfishing.com/sifnews_article.php?ID=25 .
** http://www.trademarksa.org/news/namibia-fish-exports-generated-n5-billion.

Table 2.18 shows that Zambia, Madagascar, Malawi and South Africa were among the top ten African
aquaculture producers in 2010, while Zambia, Madagascar, Zimbabwe and South Africa were among
the top ten producers in 2012 (FAO, 2012; FAO, 2012). In 2010 and 2011, the United Republic of Tanza-
nia, the Democratic Republic of the Congo, Malawi and Zambia were among the global top 25 inland
water capture producers (see table 2.19). With marine capture of 532,532 tons in 2011 and 700,811
tons in 2012, South Africa was the world’s 23rd biggest producer and the only SADC country in the top
25 global producers (FAOFAD, 2014). In all cases, SADC countries registered increases in production,
apart from the Democratic Republic of the Congo, which saw a decrease in inland water capture.

45
Table 2.18: Top 10 aquaculture producers in Africa in 2010 and 2012

2010 2012
Aquatic
Aquatic fish
Share in fish pro- Share in
Rank Country produced Rank Country
Africa (%) duced Africa (%)
(tons)
(tons)
1 Egypt 919,585 71.38 1 Egypt 1,017,738 68.5
2 Nigeria 200,535 15.57 2 Nigeria 253,898 17.1
3 Uganda 95,000 7.37 3 Uganda 95,906 6.5
4 Kenya 12,154 0.94 4 Ghana 27,450 1.8
5 Zambia 10,290 0.80 5 Kenya 21,488 1.4
6 Ghana 10,200 0.79 6 Zambia 12,988 0.9
7 Madagascar 6,886 0.53 7 Madagascar 8,588 0.6
8 Tunisia 5,424 0.42 8 Tunisia 8,577 0.6
9 Malawi 3,163 0.25 9 Zimbabwe 8,010 0.5
10 South Africa 3,133 0.24 10 South Africa 3,999 0.3
Other 21,950 1.70 11 Côte d’Ivoire 3,720 0.3
12 United Republic of Tanza-
3,407 0.2
nia (excluding Zanzibar)
Total 1,288,320 100 13 Malawi 3,232 0.2
14 Congo DR 2,869 0.2
Top SADC countries
23,472 1.85 15 Algeria 2,648 0.2
out of Africa’s Top 10
Rest of Africa 10,849 0.7
Africa 1,288,320 2.15 Totals 1,485,367 100
World 58,584,280 97.85 World 66,633,253 100
Total 59,872,600 100
Top SADC countries out of Africa’s
43,093 2.92
Top 15

Africa 1,485,367 2.23

World 65,147,886 97.77
Total 66,633,253 100
Sources: FAO 2013 for 2010 data, and FAO 2014 for 2012 data.

Table 2.19: Inland water capture

Country 2011 2012

United Republic of Tanzania 290,963 314,945
Democratic Republic of Congo 217,000 214,000
Malawi 82,415 120,328
Zambia 69,364 76,214
Total 659,742 725,487
Total 25 major countries 9,838,311 10,363,722
Share of 4 Top SADC countries 6.7% 7.0%
World total 11,124,401 11,630,320
Share of 25 major countries 88.4% 89.1%
Source: FAOFAD, 2014
46
SADC on fisheries and the fight against IUU fishing

One of the major challenges in the sector is illegal, unreported and unregulated (IUU) fishing, which
impedes the sustainable use of fish resources. The SADC Protocol on Fisheries (2003) focuses on the
promotion of the responsible use of living aquatic resources to enhance food security and human
health, to safeguard the livelihood systems of fishing communities and to generate economic oppor-
tunities for nationals in the region and ensure that future generations benefit from these resources.
In July 2008, SADC Ministers of Fisheries also signed the SADC Statement of Commitment to combat
IUU fishing, which was annexed to the SADC Protocol on Fisheries and is now part of it (ACP Fish II,
2013). The Statement calls for strengthening the efforts to improve regional and inter-regional co-
operation for fisheries governance and to reinforce Monitoring Control and Surveillance capacity at
regional level. In July 2010, furthermore, the SADC Action Plan for IUU fishing and the establishment
of a Regional Fisheries Monitoring Control and Surveillance Centre in Mozambique were approved.

ACP Fish II Programme contributed to the implementation of regional strategies on fisheries’ moni-
toring control and surveillance and collaborated with the Indian Ocean Tuna Commission (IOTC) to
strengthen the implementation of its IOTC Resolution in the region.

Several SADC member states have participated in the ACP Fish II Programme’s activities aimed at
improving fisheries and aquaculture management, at both the national and regional level by sup-
porting the development, review and update of fisheries/aquaculture policy instruments (ACPFish II,
2013) and the recently adopted 2009 Port State Measures Agreement. Revisions to the policy frame-
work will ensure they incorporate internationally recognized principles and standards, as reflected
in international and regional fisheries instruments. As a result, there are different regimes applied in
SADC member States for the management of fisheries and aquaculture sector, as defined in national
policy and legal frameworks. The management of fisheries at the national level should be harmo-
nized with regional frameworks.

Elements of inclusive growth in SADC fisheries policies and strategies

Various SADC Member States have developed policies and strategies to promote water resources,
particularly fisheries (ACPFish II, 2013; WWF, 2011; SADC/ZRA, 2008; Inter Press Service (IPS) Africa,
2010; DAFF, 2012). These policies and strategies embrace elements that promote inclusive growth in-
cluding: the promotion of small-scale fisheries development; increasing productivity in the fisheries
sector, the promotion of the sustainable use of aquatic resources; the encouragement of conservation
and the sustainable utilization of fish resources; the promotion of sustainable fisheries development
and management by increasing revenue, employment and local and foreign investment; community
participation in fishery ventures, increasing value addition, sustainable exploitation, management,
conservation of biodiversity and investment in the fisheries sector via appropriate biological, tech-
nological, sociological and environmental research programmes; promotion of skills upgrade and
the use of efficient technologies, the reduction in over-fishing, and the promotion of domestic fish
consumption to enhance food security. These aspirations can be useful to promote inclusive growth
if associated quantified benchmarks with monitoring and evaluation programmes are put in place.

Despite the interventions outlined in national and regional policies, SADC Member States face many
challenges. These include: low water productivity especially in agriculture, increasing water scarcity
and the related difficulty of allocating water among competing uses and users, poor planning for
multiple uses of water, low access to safe drinking water especially among the poor residing in rural
and peri-urban areas, low investment in water infrastructure, high water losses, and deteriorating
water quality (SADC Water, 2012; SADC/ZRA, 2008; SADC Water Accounting, 2010).
47
Furthermore, the degree of domestication of regional protocols and policies remains low, giving
rise to an enforcement gap. In addition, water sector laws, policies and regulations in SADC Member
States are not harmonized. Another challenge is that while some river basin organizations were es-
tablishedandarefunctionalinsomeofthe15 SADC’s shared watercourses, they are not fully mandated
and capacitated to plan, market and implement large water-sector infrastructure projects. The current
focus of these organizations is more on planning and determining overall management systems for
the river basins rather than on infrastructure development. As a result, the policy and management
framework gap precludes the combined use of both surface and underground water. The region
also lacks strong policies and appropriate institutional frameworks for managing the shared aquifers.
The lack of a regulatory framework to facilitate and encourage the synchronized operation of water
resource infrastructure at the river basin level for more efficient operations, improved livelihoods and
better flood and drought mitigation is another constraint.

Challenges in the fisheries sector

To improve the contribution made by the fisheries sector to inclusive growth, the following challeng-
es need to be addressed:

(i) In marine fisheries, the main IUU fishing policy issues working against inclusive growth that
need to be tackled in SADC are conflicts between artisanal and industrial fleets; conflicts in
fish harvesting in shared watercourses across national boundaries; disagreement with fisher-
ies management measures; misreporting of fish catches; fishing in restricted areas and during
closed seasons; use of harmful fishing practices; transhipment in the high sea; fishing poach-
ing; fishing by non-party vessels and the lack of effective flag state control by some states.
The challenges in achieving sustainable fisheries increase with growing pressure on fish stocks.
Critical constraints include inconsistency between policy and operational practices; a weak
management regime and an unwillingness to effectively control these activities; the lack of
collective political will, as it is difficult for states to curb IUUF; institutional human capacity re-
quirements to support the implementation of international instruments and regulations; fund-
ing problems to undertake expensive operations such as surveillance; and geopolitical and
institutional instability.
(ii) Few African governments are able to monitor or enforce the terms of agreements with foreign
fleets; most lack the capacity to effectively patrol their coastal waters. In SADC, for example,
Madagascar’s exclusive coastal zone, which is subject to extensive illegal fishing by Asian fleets,
is overseen by three small monitoring vessels, eight speedboats, 18 inspectors and 22 observ-
ers (Africa Progress Panel, 2014).
(iii) The challenges in aquaculture include the degradation of aquatic environments particularly
from land-based activities such as the discharge of sewage, industrial effluent and agrochem-
icals; weak management systems; overfishing; the limited development of aquaculture which
only contributes less than 1per cent of the SADC region’s total fish production; and minimal
intraregional trade and investment in fisheries (SADC Agricultural Policy, 2013).
(iv) The poor collection of fisheries data and inadequate proper scientific research remain con-
straints that hamper the recording of accurate fish production and scientific data and affect the
planning and management of fisheries and aquaculture resources.

Overall, the region suffers from inadequate policies, or there is poor implementation of existing ones
to support the development of the water sector.

48
Renewable energy resources
SADC possesses vast natural renewable and non-renewable resources from energy that could be har-
nessed. These include wind with high levels of speeds (as high as 9metres per second (m/s) onshore)
that can be used for electricity generation, with potential for as much as 800 terawatt-hours per year
(TWh/year); solar with insolation levels (5.5 to 7 kilowatt hours (kWh)/m2 per day) that can be used for
electricity generation, with potential for as much as 20,000 TWh/year; several waterfalls and cataracts
for hydropower generation with potential of 660 TWh/year; vast coal resources in Botswana, Mozam-
bique, South Africa, Zimbabwe and a few other countries with potential for close to 17,700 MW; and
also hydrocarbons and geothermal resources (IRENA 2013; IRENA, 2014). Other renewable energy
(RE) sources that can be harvested for commercial and domestic use include wave energy, tidal range
tidal currents, ocean currents, ocean thermal energy, salinity gradients, and biomass power.

Renewable technologies can play important roles in providing reliable, affordable, low-cost power
and help reduce fossil fuel consumption. Furthermore, they can facilitate decentralized renewable
energy supply and thus reduce investment costs in transmission and distribution networks. The fi-
nancial requirements for interconnector investment are minimal compared to the benefit of interna-
tional power trade.

A recent Bloomberg report (2014) observes that renewable energy investments in sub-Saharan Afri-
ca, predominantly South Africa, Kenya and Ethiopia, will reach the $5.9 billion mark in 2014 and grow
to $7.7 billion in 2016. However, these investments far-outweigh any efforts to increase renewable
capacity in the region from 2000 to 2013. Approximately 1.8 gigawatts of wind and solar power ca-
pacity, excluding sizable hydroelectric power plants are still to be commissioned this year. The report
notes that renewable wind, geothermal, as well as small and large scale utility solar projects are set to
lead the way as renewables can represent a cost-effective alternative, to diesel generation and also
to power stations burning coal or gas. South Africa alone is estimated to have 3.9 gigawatts of wind
and solar power installed between 2014 and 2016. During the same time, Kenya is expected to add
1.4 gigawatts and Ethiopia will install 570 megawatts stemming mostly from geothermal and wind
capacity. Furthermore, the IRENA estimates that Africa’s renewable energy capacity could quadruple
to about 120 gigawatts by 2030 due to the flow of investments. South Africa’s goal of installing 8.4
gigawatts of solar photovoltaic capacity by 2030 and its success so far in securing funds toward that
goal point to increasing renewables on the continent.

49
Table 2.20: Existing and identified hydropower generation in SADC

Existing Hydro Identified Hydro Projects

Country Capacity Average Dry Year Capacity Average Dry Year
Generation Generation Generation Generation
MW GWh GWh MW GWh GWh
Angola 474 2,595 1,713 6,735 23,438 15,470
Botswana 0 0 0 0 0 0
DRC 2,333 14,259 11,183 20,240 122,806 96,317
Lesotho 73 414 274 190 500 330
Malawi 278 1,391 919 614 2,966 1,958
Mozambique 2,122 15,604 12,107 3,147 15,954 9,139
Namibia 240 1,395 921 360 1,724 1,138
South Africa 665 878 583 0 0 0
Swaziland 62 202 134 0 0 0
Tanzania 561 1,525 1,161 1,972 6,891 6,279
Zambia 1,752 10,043 7,778 4,299 22,632 15,316
Zimbabwe 750 4,000 3,137 1,100 7,280 5,710
Total 9,310 52,306 39,910 38,657 204,190 151,657
Source: IRENA 2013

Figure 2.4 presents a summary of ranges of the levelized cost of electricity generation by type of tech-
nology determined by IRENA for SAPP. SADC therefore has the opportunity to increase energy access
and security without the environmental and economic costs associated with fossil fuels. Regional
and inter-regional powersector integration provides opportunities for exploiting the economies of
scale of large hydroelectric, geothermal, wind, solar and biomass projects, saving billions of dollars in
development, operation and maintenance costs (IRENA, 2014).

Figure 2.4: Ranges of levelized cost of SADC site-specific projects by type of technology

Source: IRENA, 2013.

50
Status of electricity demand and supply in the region

The SADC region has greater installed electricity-generating capacity than any other regional eco-
nomic communities in Africa, but has one of the lowest rates of electricity access on the continent.
The access to electricity in SADC is 24per cent compared to 36per cent in East Africa and 44per cent
in West Africa (SADC FANR, 2013). In some countries of the region, access in rural areas is even lower
than 5per cent. The region had a peak power demand of 53.8 GW against an available capacity of
only 51.7 GW, which is 96per cent of the requirement. As a result of the deficit, many countries in the
region are experiencing unreliable power supply resulting in high economic costs in lost production.
According to IRENA (2013), there is an estimated economic cost of 5-7per cent of GDP for the United
Republic of Tanzania, South Africa and Malawi owing to power interruptions.

The region derives electricity from many sources including hydropower, coal, nuclear, natural gas
and the distillate/diesel-based power generation. However, the mix is dominated by coal, which ac-
counted for 74.3per cent of the energy mix in2010while hydro accounted for 20.1per cent in the
same year (SADC, 2012a). Other sources are nuclear (4per cent) and diesel (1.6per cent). South Africa
is the only country in SADC that produces electricity from nuclear technology. Medium to large-scale
renewable energy projects from wind and solar (concentrated solar power) are presently still being
deployed for power generation, but are rather slow and therefore contributing very little.

The focus for the region in the electricity subsector is to connect all 12 mainland Member States to
the regional grid, to install adequate generation and transmission capacity to meet the projected de-
mands and to increase access to electricity based on least-cost project options. Currently, three of the
SADC Member States on the African continent – Angola, Malawi and Tanzania– are not yet connect-
ed to the SAPP grid (SADC, 2012a). The SAPP plan shows that the whole SADC region has a supply
deficit of 608 and the SAPP interconnection grid has a deficit of 204 MW. The supply deficit is most
significant in Zimbabwe (994MW) and Zambia(548MW). South Africa (625MW) and Mozambique
(1,632MW) had excess capacity in 2010.

Initiatives to promote renewable energy in the SADC region

The SADC region has developed a Renewable Energy Strategy and Action Plan (RESAP) aimed mainly
at exploring options to increase the use of renewable energy in the region, and to align the region’s
energy strategy with global trends in clean and alternative energy sources. Various potential projects
requiring infrastructure have been identified to include: hydropower (large and small), wind, solar
photovoltaic (PV)and concentrating solar power, biomass (bagasse and gasification), geothermal
and biofuels. Although the project has not yet taken off, it has the potential to cover electricity needs.
In addition, SAPP expects to achieve a renewable mix in the regional energy grid of at least 32per
cent of total energy produced by 2020, which should rise to 35per cent by 2030. This is expected to
occur although SAPP’s mandate is currently biased towards hydropower generation (IRENA, 2014).

The Africa Clean Energy Corridor, which was launched in January 2013 at the third Assembly of the
International Renewable Energy Agency (IRENA, 2014), provides a route for growth of the renewable
sector and aims to accelerate the expansion of renewable electricity production, taking advantage
of the African continent’s enormous untapped potential and helping to sustain future growth. This
initiative is a combined endeavour to optimize the 19 countries’ grid infrastructure and operations to
support high shares of renewable energy, especially in view of the falling costs of renewable energy
technologies.

51
SADC is presently developing policies to enhance the role of renewable energies in the energy mix of
the region. For example, Madagascar, which currently has a 57 per cent share of electricity produced
from renewable sources, is to increase this share to 74 per cent by 2020. South Africa’s renewables
target is 13per cent by 2020, Lesotho’s renewables target, which is focused on rural energy access, is
35per cent by 2020 (Luxande and Schutze, 2012), and Zambia’s B5 bioethanol and E10 ethanol blend-
ing targets by 2015 (Sinkala, 2013). Most sugarcane-producing countries generate combined heat
and power using bagasse. Grid-connected bagasse combined heat and power plants also exist in
Mauritius, the United Republic of Tanzania, Zambia and Zimbabwe. In Zimbabwe, a community-scale
biogas plant is under construction in Harare to convert organic waste to heat and electricity. In 2012,
South Africa began construction of a 50 MW solar power tower and a 100 MW trough plant while
Namibia announced plans for a consolidated solar power plant by 2015 (Renewable Energy Policy
Network for the 21st Century (REN21), 2013). For residential use, the most common renewable energy
is solar power, followed by biogas. The penetration of solar and biogas renewable energies are much
higher than other forms of energy largely because of their low capital investment and decentralized
nature. Wind-based renewable energy is also used mostly in farms and schools.

Mozambique has increased access through off-grid solar PV by adding 0.5 MW of capacity between
2010 and end-2012. This brought the national total to 1.3 MW. The United Republic of Tanzania con-
structed several grid-connected small-scale renewable power plants during 2012, and is implement-
ing a further 60 projects yielding more than 130 MW, which is sufficient to bring power to more than
12 villages. In 2012, Zimbabwe earmarked US$ 1.5 million for solar lanterns to be distributed in rural
schools across the country, while the country’s Rural Electrification Authority worked with local in-
dustries to develop solar lamps and create solar power jobs. Lesotho is implementing the pro-poor
public-private partnership (5Ps) model aimed at improving access to energy services for rural popu-
lations (REN21, 2013).

Challenges to the adoption of renewable energy and contribution to inclusive growth

The challenges hindering the exploitation of renewable energy in the region include poor quality of
input data to scale-up renewable energy technologies at national and regional levels; inconsistent de-
mand forecasts, and inconsistencies between regional and national priorities gathered by SAPP; poor
capacities to speed up penetration of renewable energies in the region; absence of renewable energy
micro-grids as options for providing electricity to people in isolated areas, the lack of renewable energy
or renewable energy-friendly micro funds for poor people and the lack of renewable energy targets. For
instance, biofuels blend to incrementally raise the share of renewables in national energy mixes.

These challenges need to be addressed in order to achieve inclusive access to modern energy for the
marginalised in the SADC region, which will also create jobs. Access to modern energy will in turn
promote inclusive growth.

Human capital and inclusive growth

The regional human resource base is capital, which Member States can leverage for inclusive growth.
However, the SADC region faces many challenges in utilizing its young human resources base for
productive purposes primarily owing to the limitation of skills. Yet as noted by AfDB (2011), sustaining
growth and making it inclusive in a rapidly changing environment require innovative solutions and
efficient investment in human capital. Indeed, moving up the value chain towards efficiency and in-
novation requires continued investment in human development, especially education, nutrition and
health, and science and technology. This view is shared by OECD, WTO and UNCTAD (2013), which

52
propose that the essential dimensions to people’s lives should include: income and wealth, jobs, skills
and education, health status, social connections, and environmental quality (SADC, 2013). Nutrition
and health also impact on the productive span of human capital and thus contribute to inclusive
growth. SADC Member States therefore need to invest in education and skills development, and to
increase the efficiency of labour markets by addressing inefficiencies due to various causes, especial-
ly attitudes. Apart from improving overall productivity, a skilled workforce contributes to the tax base
and reduces the social and economic costs of poverty, which contributes significantly to inclusive
growth. Table 2.20 shows that investment in education is low in most SADC countries. In Zambia, it
accounted for 1.3 per cent of GDP in 2011 while in Lesotho it was highest at 13 per cent. At present,
the mean years of schooling stand at 6.1 (ranging from 1.2 to 9.4) against the average expected of
10.7. Increasing informed participation and the productivity of SADC people in economic activity will
contribute to inclusive growth. The SADC region’s young population under the age of 35 years stands
at 76% (220 million people) of SADC’s entire population41 and faces many challenges including un-
employment, limited access to education and skills for entrepreneurship and employability, poor
health and HIV and AIDS. Youth poverty and inequality are very high and pose a threat to national
and regional development, and to peace and security. The current national programmes to empower
and develop the young need to be scaled up.

Table 2.21: SADC development and health indicators

Adult obesity (% pop-

Labour force (million)

Human Development

Inequality - Adjusted

Education expendi-

Health expenditure
Poverty level (%)

Unemployed (%)

Life expectancy
ture (% GDP)
Index (HDI)1
Population

HDI (IHDI)1

(% GDP)

ulation)

(years)
Country

1 Mauritius 1,322,238 8.00 0.63 8.10 0.737 0.639 3.5 5.9 18.5 75.17
2 Seychelles 90,846 0.00 0.04 2.00 0.806 0.806 3.6 3.8 23.9 74.25
3 Madagascar 22,599,098 50.00 9.50 2.60 0.483 0.335 2.7 4.1 1.6 65.20
4 United Republic
48,261,942 36.00 24.82 4.30 0.476 0.346 6.2 7.3 5.0 61.24
of Tanzania
5 Malawi 16,777,547 53.00 5.75 7.80 0.418 0.287 5.4 8.4 4.3 59.99
6 Democratic
Republic of the 75,507,308 71.00 34.12 49.10 0.304 0.183 2.5 8.5 1.7 56.54
Congo
7 Zimbabwe 13,182,908 68.00 3.93 95.00 0.397 0.284 2.5 0.02 7.0 55.68
8 Angola 18,565,269 40.50 8.75 25.20 0.508 0.285 3.5 3.5 6.4 55.29
9 Botswana 2,127,825 17.80 1.29 17.80 0.634 0.634 9.5 5.1 11.2 54.06
10 Lesotho 1,936,181 49.00 0.86 25.00 0.461 0.296 13 12,8 14.6 52.65
11 Mozambique 24,096,669 52.00 10.29 17.00 0.327 0.220 5.0 6.6 4.9 52.60
12 Namibia 2,182,852 55.80 0.91 51.20 0.608 0.344 8.4 5.3 9.5 51.85
13 Zambia 14,222,233 64.00 6.10 14.00 0.448 0.283 1.3 6.1 3.6 51.83
14 Swaziland 1,403,362 69.00 0.42 40.00 0.536 0.346 8.3 8.0 19.7 50.54
15 South Africa 48,601,098 31.30 18.06 25.10 0.629 0.629 6.0 8.5 31.3 49.56
Total/average = 289,464,292 44.36 125 26.08 0.415 0.298 4.29 8.62 56.33
Source: www.cia.gov ; UNDP, 2013.

41 http://www.zimbabweyouthcouncil.org/index.php?option=com_content&view=article&id=371%3Aministers-responsi-
ble-for-youth-communique&catid=35%3Aslide.

53
Lifespan and healthspan are important aspects in inclusive growth. However, life expectancy remains
low in the SADC region, compared with other countries. For example, whereas life expectancy at
birth in industrialized nations has increased from 35 years at the beginning of the 20th century to
more than 80 years now (Fahey and Kensler, 2013), table 2.22 shows that life expectancy in the SADC
region is only 56 years.

Figure 2.5 shows that countries that are affluent (i.e. with a high HDI (IHDI)) have a greater percentage
of the population that is obese than less affluent countries. If we exclude Mauritius and Seychelles,
Figure 2.6also shows that life expectancy generally decreases with increasing obesity.

Figure 2.5: Life expectancy compared to poverty, health expenditure and adult obesity

80

70

60

50

40

30

20

10

0
s

nd

ia

la

R
aw
ca
lle

iu

an

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bw

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rit

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as

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al
am
Af
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An
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az

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ag

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Ta

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Bo

Sw
M

ut

ad
Se

Zi

oz

C
So

HDI(IHDI)*20 Health Expenditure (% GDP)

Adult Obesity (% Population) Life Expectancy (Years)

Source: Plot data from UNDP, 2013; www.cia.gov

Although individuals are living longer, they are not necessarily living well. So while lifespans may
be increasing, healthspans are not growing commensurately owing to chronic stress and the oxi-
dative and inflammatory conditions associated with that stress (Fahey and Olson, 2013). The focus
on increasing lifespan to the detriment of the quality of life has resulted in great disparities in the
amount of time, effort and resources devoted to treating late disease rather than early health im-
provement (Fahey and Kensler, 2013). Limits to healthspan include disability, frailty, chronic diseases
and, of course, lifespan.

54
Figure 2.6: Life expectancy compared to obesity and health expenditure

80
70
60
50
40
30
20
10
0
Se itius

ad lles

Ta ar

ia

on wi

Bo ola

am o

ia

Sw bia

a
R
bw

an

qu

So ilan

ric
D
an

ib
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ot
g

m
as
he

al

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Af
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bi
go
r

ba
nz

An

s
au

az
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ts
ag

Le
yc

h
m

N
M

ut
Zi

oz
C
M

M
Health Expenditure (% GDP) Adult Obesity (% Population)
Life Expectancy (Years)

Source: Plot data from UNDP, 2013; www.cia.gov

Figure 2.7 clearly shows the economic cost of chronic diseases which impacts negatively on inclusive
growth, as these diseases lower health spans.

Figure 2.7: Global economic costs of chronic diseases

Source: Fahey and Olson, 2013.

Therefore, in addition to extending lifespans, SADC should also aim to increase healthspans. SADC
citizens are among the most affected owing to their poor diet and healthcare systems, among other
factors. As a result, investment in education is not generating commensurate benefits owing to short
lifespans and inefficiencies associated with short healthspans.

55
Challenges to maximising the contribution of human capital to inclusive growth

The effective contribution by human resources capital to inclusive growth is constrained by many
factors including: inadequate investment in education and skills development; poor investment in
developing local solutions to problems affecting the SADC region; unhealthy communities resulting
in short lifespans and healthspans; and poor regional investment in wellness and socioeconomic
activities that prolong lifespans and healthspans in the region. The poverty levels in the region also
limit the ability of people to access health facilities.

Summary

This Chapter has shown that natural resources are critical to all aspects of human well-being and that
access to these resources is at the core of enhancing opportunities and choices for citizens. For ex-
ample, land is at the centre of development, as access to land and the manner in which it is managed
is important for promoting inclusive growth. Agriculture, the primary use of land in the whole SADC
region, is central to poverty reduction, inclusive growth, and food and nutrition security. Mineral ex-
ploitation is important for revenues, employment, skills development, and economic diversification.
Forests and non-wood forests contribute towards the basic needs of communities and individuals in
the form of fuel, animal fodder, resources for shelter and housing construction, timber for furniture,
curios, agricultural tools, medicines, and indigenous foods. Wildlife and tourism are a crucial source
of employment, foreign exchange earnings and revenues and the wide-ranging region’s unique fea-
tures of wildlife, culture, landscapes, water and other attractive natural resources if well utilized have
considerable potential to contribute to inclusive growth. Water resources also hold significant po-
tential to contribute to inclusive growth in SADC via fisheries harvesting, agriculture, water sports
and cruises, transport, power generation, the potable water industry and irrigation. The region’s nat-
ural renewable and non-renewable resources could also be harnessed for clean energy. Access to
modern energy is important for socioeconomic development and inclusive growth. In addition, the
region’s population, of whom 76 per cent are less than 35 years of age, is a human resource which, if
healthy and skilled, can strongly improve overall productivity and expand the tax base, reducing the
social and economic costs of poverty and thereby contributing to inclusive growth.

The discussion in this Chapter identified a series of factors that hinder the contribution of the ex-
ploitation of various resources to inclusive growth. In respect of land, for example, poor access to
land owing to land tenure systems and ownership history are the primary constraints. As for mining,
the constraints include low mineral value addition, low linkages and multipliers, poorly designed and
inefficient fiscal frameworks, inefficient mining methods, transfer pricing, and the limited participa-
tion of locals along the mineral value chain. For forestry resources, the constraints relate to the weak
institutional frameworks to support the coordination and implementation of national forestry poli-
cies, conflicting land tenure systems, poor infrastructure to the industry, limited financial resources
for commercial forestry, illegal wood harvesting and uncontrolled charcoal production and limited
value addition. In the case of wildlife and tourism, challenges include: poor skills for communities to
meaningfully participate in wildlife conservation projects, inadequate resources to develop projects
to commercial levels and limited value addition on related products. For the water sector, the con-
straints include inefficient water use, poor planning for multiple uses of water, and low investment in
improved water infrastructure. The Chapter also identified constraints for renewable energy, which
include: the absence of renewable energy micro-grids for domestic use; weak policy frameworks for
renewable energy; and the lack of finance to invest in the sector. Inadequate investment in educa-
tion and skills development, an irrelevant curriculum, short lifespans and healthspans owing to poor
investment in health both impact on the contribution of human capital to inclusive growth.

56
Chapter 3: Making natural resources contribute to inclu-
sive growth in SADC
Overview
As discussed in Chapter 1, inclusive growth is founded on broad-based growth across all sectors of an
economy. It includes both low and middle-income groups and has a productive distributional aspect
that aims to minimise income inequality in society. Furthermore, Chapter 1 has shown that although
SADC economies have performed relatively well in recent years in terms of economic growth, job-
lessness and inequality still persists. Furthermore, gender disparities in terms of wealth distribution
still remain and youth unemployment remains a major feature of the SADC economies. The Chapter
has also shown that lifespans in the region are low due to various factors. The discussion in Chapter
2alluded to the challenges in the various resource sectors in promoting inclusive growth.

It is therefore now instructive to investigate strategies for strengthening the role of natural resources
exploitation to inclusive growth in the region.

Suggested principles of inclusive growth

The approach suggested in this report is based on (i) the assessment of options for exploiting natural
resources in a given area, (ii) the identification and promotion of natural resource-based industries,
with assured markets prioritizing locals throughout the value chain as a bedrock for catalysing the
path of inclusive growth in the region, (iii) the local retention of the maximum possible value from
exploited natural resources, (iv) the maximum productivity by human capital, and finally (v) inclusive
sustainable growth.

Principle 1: To explore business alternatives in an area based on existing natural resources.

This will isolate best possible options and will help to better plan land use and maximize benefits
from natural resources available on the land. The resources will be efficiently and responsibly exploit-
ed and utilized for people’s livelihoods in, for example, the mineral resource locality. Furthermore, it
will minimize missed opportunities for maximizing inclusive growth benefits from natural resources.
Investment in a natural resource involves capital, labour and energy. To exploit natural resources (e.g.
minerals), a “foreign” investor usually brings technology, funds, skills and a market for products. In the
mineral host environment, there will be minerals, other natural resources and a host community from
which to draw labour. Foreign investment will generate revenues, develop infrastructure (roads, rail-
ways, telecommunications, etc.), train personnel, and build schools and hospitals. To achieve both in-
clusive growth and sustainable development and to experience net gains from investment, policies
need to target key enabling pillars. Since mineral-based resources are exhaustible (i.e. their quantity
is finite) and their mineable form will ultimately be depleted, SADC should ensure that revenues from
investment in those natural resources that are still available in the region serve the interests of the
region and that no one is left behind – this is what inclusive growth signifies. To improve inclusive
growth, citizens must be active along the value chain as entrepreneurs and skilled manpower (see
figure 3.1).

Principle 2: To prioritize a renewable natural resource-based industry with assured mar-

kets. This will protect people from risking their inputs into economic livelihoods and will graduate
them into an inclusive growth trajectory. Thiswill enable people to enjoy the benefits derived from

57
their natural resources without hindrance. Furthermore, the benefits of natural resources in a locality
will benefit the locals and the principle’s broad-based growth will be satisfied.

Figure 3.1: Schematic illustration of the relationship between resources and inputs and
outputs

Source: Sinkala, 2009.

Principle 3: To maximize the retention of value in business inputs and outputs. This will retain
the value of investment/revenue locally, which will provide resources for investment in programmes
that have the potential to contribute to inclusive growth. Locals will be able to sustainably utilize
the indigenous natural resources for their livelihoods and enjoy the benefits from these resources
throughout their lifetime without hindrance.

On the basis of principles 2 and 3, a classification approach is proposed as follows:

1. Renewable natural resource-based inclusive industry where SADC has a local value chain and
predictable local markets and therefore an inherent shield or resilience against external shocks
should be considered Priority 1. This is strength for SADC in order to stabilize incomes in the
region and assure the meaningful participation of citizens in inclusive growth programmes.
2. Non-renewable natural resource-based inclusive industry where the value chain is partly in
SADC but predictable international markets will be Priority 2. The resource is a source of eco-
nomic strength for SADC, and revenues from the assured market must be invested in promot-
ing and establishing Priority 1 industries and in addressing challenges in Priority 3 industries.
3. Renewable natural resource-based inclusive industries where the value chain is partly or wholly
in SADC but the market is volatile should be considered Priority 3. The resource is a strength
for SADC, but market volatility is a weakness whose internal segment must be minimized by
the region. This industry must be tackled in such a way that most of it progressively migrates
to Priority 1.
4. Non-renewable natural resource-based (financially/technologically/market) restrictive indus-
try where the value chain is partly SADC, but the market is volatile and predictable should be
considered Priority 4. The resource is a source of economic strength for SADC, but the region

58
 must tactfully gain entry to this “steel-gated” industry. The revenues are required to promote
and establish Priority 1 industry and to address challenges in Priority 3 industry.

Principle 4: To maximize the human resource contribution to inclusive growth. This will en-
sure that growth exists where all people in a geographical area are equitably facilitated with condi-
tions and opportunities to actively, efficiently and responsibly apply their abilities during their func-
tional lifetime to utilize natural resources for their livelihoods and to enjoy the benefits derived from
these resources throughout their lifetime. If SADC citizens become more economically productive
and enter the middle class, the region will experience net economic growth. A fundamental goal
of economic development in the region must therefore be to create the most productive, efficient,
high-growth economy possible by investing in education and in both the lifespans and health spans
of SADC people.

Principle 5: To ensure that inclusive growth is sustainable and green. Growth is sustainable
if it facilitates environmentally-friendly continuity. Thus, inclusive growth must not be short-lived,
but must ensure intra and inter generational equity. This requires a green approach to the exploita-
tion and use of natural resources, not the mining of natural resources. Industries that have a strong
and broad participation of locals both on the supply and demand side contribute more to inclusive
growth than those with limited local participation. Local citizens can then migrate to other sectors
once capital has been built through initial local content policies.

The sections below discuss the required actions for SADC to improve the contribution of natural
resources to inclusive growth.

Facilitate access to land and inclusive growth

Land policies need to be designed with an inclusive growth development path in mind, taking into
account the national and regional present status and future goals. The policies must also consider the
evolving relationships between various sectors in the economy, and the multiple functions of land,
not least social versus economic functions. This situation therefore requires balancing the diverse
interests. For example, land imbalances that are prominent in South Africa and Namibia need to be
addressed in a transparent manner.

Improve land tenure and administration and access to capital: The land administration system
should be funded and capacitated accordingly. A land tenure system is only as good as the land ad-
ministration system that supports it (SACAU, 2010). The major problem with current land administra-
tion systems in SADC Member States is centralization, general bureaucracy and inaccessibility. Land
is thus often inaccessible to those who need it most (e.g. rural communities). Yet, land is an important
resource for livelihood and inclusive growth. Land reforms will simplify the land access challenges
and facilitate access to secure and tradable land by rural communities.

Promote land markets: According to the African Union’s Land Policy Framework and Guidelines
(2010) document, promoting the development of robust land rights transfer systems and markets
offering various types of rights will expand opportunities for the acquisition of land resources for
many agricultural users engaged in large or small-scale, formal or informal operations. When prop-
erly regulated, this flexibility can be of immense value to the disadvantaged, especially women and
people living in informal settlements in the agricultural or urban sectors.

59
Furthermore, rural land markets, which enable rural communities to raise capital for investment in
agriculture and other economic sectors, can improve inclusive growth prospects through the sector.
With access to secure land in place, capital markets can easily fund the investment needs of rural
communities. This step may be complemented by introducing incentives for lending institutions
to provide specialized lending and to recognise both temporary land rights and long-term leases
as collateral. Rental markets can achieve a more efficient allocation of land use without necessarily
changing the ownership pattern in the short term. Other analysts note that sharecropping should be
actively encouraged because it is an efficient arrangement that is more effective than the emerging
land sales market. In South Africa, for example, the absence of an effective rental market in commu-
nal areas has been identified as the main reason for the widespread under-utilization of arable land
(SACAU, 2010).

Invest in rural access infrastructure: The value of rural land suffers from the lack of infrastructure
such as roads, rail and telecommunications to develop the land or exploit natural resources from
it. SADC Member States should therefore invest in infrastructure to improve access to rural land,
attendant natural resources and land markets. This will enhance opportunities for a successful ru-
ral-based industry and the value of rural land. The provision of basic infrastructure and basic social
services including roads, markets and water will open up more business opportunities for unem-
ployed rural communities, increase trading for farmers, and promote revenue collection by the local
governments. This will in turn facilitate people’s increased access to other government services such
as schools and health centres, and will strengthen the capacity of the local governments to deliver
services to the rural poor. Improved infrastructure will also increase access to business opportunities
owing to expanded markets, crop processing and enlarged storage facilities.

Promote integrated land management land use: Land has multiple uses and competing inter-
ests determine the ultimate use. Although the management of land and water resources is intercon-
nected, the resources are still largely managed as isolated policy issues and research on the numer-
ous links between them is not as well developed. The complex relationship between land and water
rights is expected to increase with climate change. Integrated policy, planning and management and
the use of water and land resources can contribute to ecosystem stability, sustainable livelihoods and
food security.42 Box 3.1gives an example of multiple benefits from integrated land-use in Namibia.

Box 3.1: Integrated wildlife production and tourism development yield benefits for con-
servancy communities in Namibia (Weaver and Skyer, 2004)
Traditionally, Namibians residing in communal areas have depended heavily on subsistence crops and live-
stock to support their daily livelihood needs. However, there is growing recognition of the unsuitability in
much of Namibia for arable crop or sustainable livestock production, and the Namibia Ministry of Envi-
ronment and Tourism has initiated a national conservancy movement that seeks to promote and integrate
(where appropriate) wildlife production and tourism development efforts into the welfare and livelihoods of
many communal area residents.

The positive community attitude has had a marked impact on the recovery of wildlife populations. The
recovering wildlife populations are now being translated into tangible benefits for conservancies and their
members in the form of cash returns to conservancies / enterprises, employment, and in-kind benefits such
as meat from game (trophy animals or own-use harvesting). Since the 1996 conservancy legislation was
passed, the Namibia National CBNRM Programme has noted a rapid increase in the flow of benefits to
conservancies and their members.

Agriculture and other economic uses of land: SADC Member States facing population-driven
land scarcity can promote agricultural development together with economic diversification by cre-
42 http://www.ecologic.eu/3753.

60
ating conditions that allow farms to consolidate and those leaving farming to engage in viable off-
farm economic activities. Tenure reform and land administration development will enhance security
and foster the rental and sales market in land. This will not only benefit expanding farmers but also
those renting or selling land who would be able to raise resources for other business ventures. In
Member States with abundant land, the focus should be on developing infrastructure to facilitate a
more effective use of agricultural and natural resources. Facilitating voluntary land transactions is also
important, as it generates resources for further investment. As noted by SACAU (2010), the orderly
administration of land allocation and tenure security in underexploited areas is important to promote
effective and inclusive growth development.

The countries with poor agricultural endowments need to determine the optimal use of their limit-
ed agricultural resources, which will vary from case to case. Given the impossibility of national food
self-sufficiency, the promotion of commodity production appears more logical, particularly local
agro-processing and other manufacturing and related services. In the cases of Seychelles and Leso-
tho, there is scope for further intensification of arable production, but this presumes a greater degree
of tenure security. In case of the need to enlarge farms, off-farm opportunities for the rural poor must
be developed to capture them onto the path of inclusive growth.

For SADC Member States with politically volatile land ownership patterns, workable policies should
be developed to secure the coexistence between smallholder and large farms. Governments must
invest in building capacity for land use so that those accessing land do not underutilize or misuse this
increasingly scarce resource. Also, land reform must ensure everyone equitable access to land. These
measures will improve the productive use of land resources.

Address gender imbalance in land tenure: As noted in chapter 2, women are generally disad-
vantaged in terms of land access yet form the largest farmer groups and agricultural entrepreneurs.
Women must therefore be given equal rights to land and ownership. This may require taking this
law into traditional structures, which are often the source of this discrimination. Combining increas-
ing access to land with easy access to inputs will improve agricultural production and address food
security. Furthermore, the promotion of general access to land by locals is an important instrument
for empowerment and the productive use of natural resources. Thus, the ongoing land transactions
should not marginalize local populations as this will deny them of a source of livelihood.

Enhance the contribution of the agricultural sector to inclusive

growth
As noted earlier, agriculture is one of the key sectors with significant potential to contribute to inclu-
sive growth in the SADC region. However, the sector’s contribution hinges on the management of
land, water, soils, and forests, and the availability of agricultural inputs and technology. To improve
the agricultural sector, the SADC region needs to increase investment in this sector, to enhance ac-
cess to secure land especially by small-scale farmers and women who are currently disadvantaged,
to improve land-use planning and management, to enhance agricultural infrastructure, to boost the
farmer input support system, to ameliorate the market environment in order to reduce post-harvest
losses, and to facilitate access to affordable finance. Member States need to provide more support
to rural areas where the region’s most vulnerable and marginalized populations reside. The devel-
opment of watersheds can positively impact on food security, social protection and the welfare of
beneficiaries, in the form of improved rain-fed agriculture, forestry, livestock, soil conservation, water
and sanitation in catchment areas. Furthermore, the development of agricultural clusters can spur
large employment dividends. For example, the Malawi Smallholder Out-grower Sugarcane Produc-

61
tion Project funded by AfDB contributed to the development of 1,115 hectares of irrigated sugar-
cane, which engaged 271 out-growers and sustained significant rural employment while significant-
ly contributing to foreign exchange earnings and import substitution. It has helped make sugar the
second largest export crop (after tobacco) in Malawi and has improved the welfare of growers and
contributed to food security (AfDB, 2014).

The region needs to increase investment in research, development and demonstration (RD&D) and
innovation, including farm-based research, natural resource surveys, irrigation feasibility studies, ac-
cess to assured markets for agricultural products, and designs that will provide a wealth of knowl-
edge to enhance agriculture production. Support for various research institutions at both Member
State and regional level also needs to be increased.

Furthermore, the agricultural sector can take advantage of the abundant water available in certain
SADC countries such as Angola, the Democratic Republic of the Congo, Mozambique, the United
Republic of Tanzania and Zambia in order to develop extensive aquaculture and irrigation activities
that would significantly increase food security and food export opportunities in the region. Zambia,
for example, possesses 35 to 40per cent of SADC’s fresh water resources. However, the country’s ir-
rigation subsector is poorly developed. SADC therefore needs to accelerate closing the gap, which
amounts to 13 per cent of additional land to be irrigated by 2027. Water impoundments and un-
derground water sources in SADC would help mitigate water scarcity for irrigation during drought
seasons.

There is also a need to foster green growth-based agriculture designed to promote sustainable infra-
structure, the efficient management of natural assets. Additionally, building resilience of livelihoods
is fundamental to achieving inclusive growth in agriculture. Furthermore, there is a need to shift to
a more holistic approach vis-à-vis agriculture sector growth, with a strong emphasis on promoting
key components and inclusive drivers in the sector. The latter will help maintain and increase farm
productivity, reduce negative externalities and rebuild ecological resources with the protection and
preservation of the environment as global priorities.

The growth of SMEs in agriculture and agro-industry offers opportunities for value addition and thus
generating a larger contribution to GDP and a wider range of income and employment opportuni-
ties in Africa throughout the commodity value chains. The inclusive growth opportunities for farmers
and non-farmers along the agricultural value chain include (i) agriculture inputs such as fertilizers,
seeds, pesticides and equipment that need to be produced or procured/traded at reasonable cost to
be affordable for poor farmers; (ii) producing various crops, vegetables, fruits, livestock, etc.; (iii) trans-
porting and trading such produce; (iv) agro processing and packaging; and (v) the wholesaling, retail-
ing and vending of farm produce. These opportunities are presently untapped to a significant extent.

However, investment in adaptable and improved technologies for overall agriculture productivity
enhancements, especially those tailored to the environments of small-scale farmers to ensure inclu-
sive agricultural development in SADC is required. Focus areas should include drought-tolerant and
water-efficient crop varieties and technologies.

Farmer support organisations are important in complimenting government efforts to sustain farmers’
agricultural activities, especially for stretched geographical areas. Subsistence farmers may not be
able to take risks and invest in even the first step of utilizing new crop varieties and employing im-
proved cultivation methodologies. These organizations are fundamental to acquiring, applying and
continuously disseminating knowledge and skills to farmers. They can provide economies of scale
in procuring agricultural inputs, providing storage and transport, and negotiating the price of farm

62
products. Local communities can also improve their negotiation position with private agribusinesses
via these organizations.

The above measures should significantly position the agricultural sector as the main pillar of inclusive
growth in the SADC region.

Use Market-Assured Renewable Natural Resources as a Catalyst

Renewable natural resource-based industries where the value chain is localized and markets are local
and predictable provide a shield or resilience against external shocks. These industries will stabilize lo-
cal incomes and strengthen meaningful participation in local economic opportunities. The example
of biofuels and bamboo-based industries is presented below by way of illustrating Priority 1.

Biofuels industry: The liquid fossil fuel consumption in the SADC region is more than 142 million
litres per day (or 51.8 billion litres/year). For a consumption ratio of 1:2 for gasoline to diesel, a 100per
cent (E100) substitution of bioethanol for gasoline at a bioethanol energy content of 68per cent
would translate to about 69 million litres of bioethanol per day while a 100per cent (B100) substitu-
tion of biodiesel for diesel at a biodiesel energy content of 89per cent would give about 106 million
litres of biodiesel per day. Assuming SADC countries introduced the B100 and E100 mandates, the re-
gion would create assured and stable local business opportunities in both production and consump-
tion amounting to more than US$166 billion per annum while creating more than 6.1 million jobs,
US$366 billion in new housing, US$14.6 billion of food economy annually owing to the biofuels sec-
tor alone. This economy is based on a 100per cent regional production and consumption, in which
all rural areas that have been hitherto marginalised would fully participate. Since biofuels production
is largely rural-based and since feedstock cost is about 50per cent to 70per cent of the production
cost of biofuels, this means most money would be in the hands of ordinary people in rural areas. As
a result, agricultural production and food security would be increased. Construction of infrastructure
in the form of communications, housing and social amenities would stimulate immense backward
and forward linkages in other sectors, which would stimulate further jobs and incomes. Box 3.2below
presents an example of Thailand’s experience with the cassava-based bioethanol industry.

Box 3.2: Bioethanol industry expands cassava market and stabilizes cassava prices for
farmers in Thailand (Sriroth, Wanlapatit and Piyachomkwan, 2011).
The cassava value chain includes land clearance, seedlings supply, cultivation, pre-processing, bioethanol
conversion, transportation, and dispensing. In Thailand, farmers before the introduction of the bioethanol
industry frequently experienced an oversupply of cassava that led to falling prices and farm incomes. The in-
troduction of the bioethanol industry therefore opened up an expanded market for farmers, which has since
stabilized cassava prices. According to FAO, (2010), Thailand is today the 3rd largest cassava producer in
the world after Nigeria and Indonesia. Of the 40 licenced bioethanol refineries, 25 factories use cassava with
a total production capacity of 8.59 million litres/day.

In Thailand, cassava is considered to be one of the most important economic crops with an annual produc-
tion of about25-30 million tons. Apart from bioethanol, cassava also serves as a subsistent cash crop for
farmers, an industrial crop for the production of chips and starch, supply for food, livestock feed, and other
products. Consequently, the demand for cassava has been steadily rising in Thailand, thereby contributing
to the transformation of agriculture and to economic growth in the country.

Bamboo-based charcoal industry: About 70 per cent of people in the region rely mostly on wood
or charcoal for cooking. The potential regional market for charcoal is worth US$3.4 billion based
on an average expenditure of US$1/day for an average of 2.5kg charcoal (maximum: 4 kg/day) per

63
five-member family household (Technoshare Associates, 2007). On the basis of this daily consump-
tion per household and assuming 0.3 persons employed per ton of charcoal consumed (Maltitz,
2013), about 2.6 million people would be engaged for the production, transportation and retailing of
charcoal in the value chain. Actual charcoal consumption and hence the potential market are higher
than estimated, as some people with electricity connections also use charcoal.

As noted in Khennas, Hagen and Muok (2013), Africa is the only region in the world where charcoal
consumption has been increasing. For example, estimates show that annual charcoal production
rose from 24.8 million tons in 2003 to 31.0 million tons in 2009.With rising population pressure in
SADC, the forest base is fast eroding in the region primarily for two reasons: (i) poor practices of using
natural resources in agriculture; and (ii) the production of wood or charcoal for cooking energy, re-
sulting in environmental degradation. The region needs to implement sustainable charcoal policies
including the use of energy-efficient technologies, which would help to increase supply and main-
tain the regeneration rate. Charcoal can be derived from renewable biomass, which is either planted
or managed without a net loss of biomass stock. Box 3.3 illustrates sustainable charcoal policies in
Sudan.

Box 3.3: Sudan experience suggests fuel switching is a complex issue (Khennas, Hagen
and Muok, 2013)
The Sudanese government is promoting private investment in charcoal production for foreign markets. Pri-
vate forest owners are allowed to export their charcoal and, as a result, many companies are investing in
the industry. The approach is that investors meet the cost of establishing and maintaining the plantations
or forest regeneration. The government is also encouraging farmers to plant trees under the agroforestry
land management system. In 1998, charcoal consumption exceeded the sustainable supply by 45per cent.
The government therefore introduced policies to reduce charcoal consumption. One of the strategies was
to promote the use of liquefied petroleum gas by increasing the price of charcoal by three times that of gas.
However, this measure did not reduce the demand for charcoal, which may imply that fuel switching is a
more complex issue requiring further understanding.

The bamboo-based charcoal industry accommodates a wide range of participants due to the multi-
ple uses of bamboo. An estimated US$3.4 billion in revenue can inclusively be earned from the inter-
nal charcoal business in the SADC region, which can be invested in other economic activities. Over
600 million people around the world generate income from bamboo while hundreds of millions of
people in the world live in bamboo houses (United Nations Industrial Development Organization
(UNIDO), 2009). Box 3.4 illustrates an example of the bamboo-based industry in China.

Box 3.4: The bamboo industry in China*

China is one of the distribution centres of bamboo products in the world. The country has 5.38 million hect-
ares of pure bamboo forest, which accounts for 25per cent of the bamboo area in the world. The production
of bamboo culms in China changed little from 1978 to 1990, but significantly speeded up during the next
20 years due to the industrialisation of bamboo, especially from about 2000. Today, China makes numerous
products from bamboo including handicrafts, woven articles, scaffoldings, plywood, floorings, structural
articles, mats, toothpicks, and charcoal. In 2010, the bamboo industry recorded total production worth
US$13.8 billion and directly employed 5.6 million people.

* http://www.worldbamboo.net/wbcix/presentation/Yue%20Yongde%20INBAR.pdf .
In addition, bamboo can simultaneously provide considerable environmental benefits such as soil
stabilization and erosion prevention on hill slopes and verges, conserving and protecting forests
while creating enduring supplies for the wood and cellulose industries.

64
Make non-renewable mineral resources stimulate inclusive
growth
An indicated in Table 2.5, wealth from mineral resources has propelled countries onto a trajectory of
inclusive growth provided these countries apply themselves well across the six areas of the natural
resources value chain including (i) institutions and governance; (ii) infrastructure; (iii) fiscal policy
and competitiveness; (iv) local content development; (v) spending the windfall; and (vi) economic
development (Dobbs and others, 2013). The achievements of Botswana, Namibia and South Africa
outlined in the previous chapter demonstrate the benefits of sectoral integration and its contribution
to inclusive growth.

The Africa Mining Vision (African Union, 2009) advocates mining for development rather than nar-
rowly focusing on revenues. Tax revenues should be optimized and invested in development policies
at local, national and regional levels, thus ensuring that communities enjoy the benefits of resource
extraction. Other key strategies towards inclusive development include beneficiation and value ad-
dition and the promotion of local content, local business linkages and local employment. Unlocking
the socioeconomic benefits of the continent’s mineral wealth requires strengthening horizontal and
vertical economic linkages between the mining sector and national enterprises and other economic
sectors; improving the quality of the business environment; increasing private sector confidence
and participation; and reducing entry barriers and operating costs to achieve economies of scale.
Promoting inclusive minerals development in the SADC region requires the creation of a policy envi-
ronment that enunciates the specific policy direction and supports it with a legal framework.

Policies: The intentions of SADC Member States need to be clearly articulated in the regional and na-
tional policy frameworks. Of the mineral sector policies in the mining codes examined (table 3.1), only
South Africa explicitly provides for a quantifiably monitored and evaluated public participation in the
mining value chain beyond mere policy pronouncements. The South African National Environmental
Management Act, 1998 (Act No. 107 of 1998, Section 4.3.1) (ii) states that an environmental man-
agement plan must enhance the participation of stakeholders. Similarly, the Mineral and Petroleum
Resources Development Act, 2002 (Act No. 28 of 2002), Section 52(g) states that an environmental
management plan must contain a record of public participation. In addition, the Mining Charter has
introduced elements aimed at strengthening the active participation of indigenous South Africans in
the ownership and management of the mining sector (Government of the Republic of South Africa
(GRSA) 2009, GRSA 2010). These elements are:

1. Ownership (a minimum of 26 per cent by Black Economic Empowerment (BEE) for Historically
Disadvantaged South Africans (HDSA) by 2014)
2. Procurement and enterprise development (a minimum of 40per cent of capital goods, 70per
cent of services and 50per cent of consumer goods from BEE entities by 2014)
3. Beneficiation (to enhance local industrialization)
4. Employment (equity of 40 per cent by HDSA by 2014 (including Board level executive manage-
ment, EXCO level senior management, core and critical skills, and middle and senior manage-
ment levels)
5. Human resource development (5per cent by 2014)
6. Mine community development (cost proportionate to investment size)

65
 7. Housing and living conditions (improved housing and room occupancy by 2014)
8. Sustainable development and growth of mining industry (measures to include the develop-
ment of local skills and the use of local institutions in R&D) and
9. Reporting (monitoring and evaluation).

The broad range of policy measures that can be used to increase the value of wealth obtained from
the minerals industry include; raising local content in mining activities; localizing the sale of mineral
commodities; undertaking exploration to increase the knowledge base for bargaining with investors
and, where possible, investing regionally in mining; and localizing downstream processing. Recent
policy pronouncements in the region have focused on increasing local content along the mineral
value chain as a way of domesticating the sector.

Optimize revenues from mining and invest in inclusive growth programmes: While consid-
erable sums of money are often invested in programmes intended to generate economic and social
returns to local communities including health, education, housing and transport infrastructure, there
is need for a balanced approach so that impacts on people’s quality of life are considered holisti-
cally and are understood through credible measures. One of the measures for enhancing revenue
collection is the application of appropriate and flexible tax rates including resource rent taxes and
increasing the local content in the mining value chain. The SADC region must maximize earnings
from natural resources and invest in building infrastructure and in diversified sectors and the services
industry, which will broaden backward and forward linkages in the economy and create further em-
ployment opportunities in other sectors. As noted by OECD, WTO and UNCTAD (2013), participation
in the global value chain increases revenues and overall benefits.

Local content: A study by World Bank (2012) on increasing local procurement by the mining in-
dustry in West Africa revealed that mining companies can minimize their logistics and stock holding
costs, reduce their lead times, increase security of supply, enhance their reputations and obtain a ‘so-
cial licence’ to operate. Local businesses, entrepreneurs, and communities can benefit from increased
access to business opportunities, from increased stability and diverse markets, and from the improve-
ment of business capabilities, including access to capital, productivity, technology, and health, safety
and environmental practices. The other wider benefits include a higher level of employment and
skills, increased domestic and foreign investment, technology and knowledge transfer from interna-
tional companies, exports and foreign exchange, and a boost in government tax revenues. The Africa
Mining Vision also advocates for the introduction of policies which increase domestic value add in
the sector.

Enhancing linkages through value addition: Downstream processing is an important step in the
SADC mining sector. Products derived from processing will attain higher values than raw materials,
which will help to retain increased revenues from the mining industry. Downstream processing will
also advance backward and forward linkages, jobs, and industrial infrastructure, in addition to many
other benefits. Manufacturing skills, for example, can be used to support the manufacture of imple-
ments for the agricultural sector and can also offer technical backup for cluster activities in other
sectors. Box 3.5 shows Botswana’s progress in domesticating the diamond sector.

66
 Box3.5: Localization of downstream processing of diamonds in Botswana (Tshetlhane,
2013)
Botswana setup a diamond hub in 2008 to facilitate the diamond industry in downstream activities. The Gov-
ernment of Botswana relocated the selling of diamonds from London to Gaborone, and the first sight sale
was made on 11 November 2013. Diamond mining value added was 21per cent of GDP in 2011. Diamond
polishing value added was2-4per cent. There is also direct value added in form of capital invested (equip-
ment and buildings), labour (wages paid), taxes (from operations), interest (borrowing from local banks),
indirect value added; ancillary services provided such as banking, security, transport and housing).Rough
diamond trading value added is about 1-2per cent. Relocation of global sightholder sales from London to
Gaborone has benefited other sectors such as transport, hotels, tourism, and property development. In
terms of employment, about 3,600 people are directly employed in diamond-cutting factories, representing
a 29per cent addition to diamond industry employment (diamond mining employed 8,902 people in 2011),
and indirect employment of 500 people owing to cutting and polishing. Although direct value added with
cutting and polishing is usually no more than 5per cent, spillover effects from related sectors increase this
figure in the form of indirect value added.

In another example of domestication, Zambia localized the auctioning of emeralds in 2013 in order
to ensure that the proceeds of this precious resource benefit the local people and to promote invest-
ment in host communities43. In the latest auction held from November 11 to 15 2013, revenues were
US$16.4 million – a record for lower grade auctions while the average per carat price was US$3.32 – a
27 per cent increase on the company’s previous record.

Despite abundant feedstock for industrialization (iron ore, copper, phosphates, coal, limestone, etc),
the SADC region faces many challenges in pursuing value addition and linkages owing to constraints
such as a lack of supportive policies, small markets at national level, a lack of technologies, a lack of
processing skills and inadequate infrastructure..

Invest revenues from minerals to diversify the economies: Box 3.8 illustrates how Chile has
applied wealth from mainly copper to diversify her economy. Economic diversification averts the
challenges of resource curse and the Dutch disease. Chile’s economic diversification in agriculture
and the service industry is contributing significantly to job creation and hence inclusive growth, as
shown in Figure 3.6. The creation of industrial clusters around the copper sector has generated mul-
tipliers in the economy.

43 www.lusakatimes.com

67
 Box 3.6: Economic diversification: Chile diversifies economy using copper revenues (Chil-
ean Economic Development Agency, 2013)
In Chile, the mining sector is the highest-earning industrial sector with nearly US$18 billion in net profits in
2010. Copper-rich Chile has used mineral wealth to diversify her economy by investing in industrial clusters,
which has spurred forward and backward linkages in the country. There are now clusters on mining equip-
ment and inputs, aquaculture (e.g. salmon and trout), forestry, agro-industry (e.g. raspberry, wine, fruits, cut
flowers, coffee), and global services. The Chilean wine cluster has captured attention far and wide because
of its meteoric rise in international markets. For example, , Chile exported 391,000 tons of wine in 2006, ex-
ported US$2.4 billion worth of salmon and trout in 2008, and exported US$164 million worth of blueberries
in 2010.

Chile has also invested a significant part of the boom resources on training highly advanced human capital
by allocating US$ 6 billion in windfall savings for the development of human capital, with the goal of increas-
ing the number of PhDs per capita. The returns of this fund will be used to award scholarships to Chileans
who enrol at top world universities. The number of Chilean students abroad increased from 172 in 2005 to
2,500 in 2009 and will keep on increasing. The World Economic Forum ranks Chile as Latin America’s most
competitive economy. For the world competitive index, Chile is ranked first among Latin American countries,
its macroeconomic stability is ranked first in Latin America and ranks 30th out of 133 countries globally. For
the best place to do business in the period from 2009 to 2013, Chile is ranked first among Latin American
countries, fourth among emerging economies, and 15th overall among 60 selected countries.

Figure 3.2 shows that, apart from agriculture, the growth elasticity of poverty reduction among
non-agricultural subsectors is typically higher in trade and transport and manufacturing than in min-
ing and utilities, construction, and finance and business.

Figure 3.2: Growth elasticity of poverty by agricultural and non-agricultural subsector in

four selected SADC countries

Source: World Bank: Africa’s Pulse, 2014.

To improve the prospects for inclusive growth, economic diversification from renewable natural re-
sources can also be enhanced by non-renewable mineral resources (box 3.7). Malaysia’s political sta-
bility and good macroeconomic policies have helped the country to gain ascendance to the global
ranks of well-managed economies.

68
 Box 3.7: Economic diversification: enhancing a diversified Malaysian economy using oil
resources (Noh, 2013)
Malaysia has often been singled out as a success story when it comes to economic performance. The coun-
try has successfully transformed its economy since gaining independence in 1957. Despite being endowed
with tin, oil and gas, Malaysia has developed into a multisector economy driven by high technology and cap-
ital-intensive industries. The Malaysian economy was already diversified with major revenues coming from
primary products like tin, rubber and palm oil before oil and gas production became commercially viable.
In fact, by 2009 the oil and gas sector contributed only 19per cent of Malaysia’s GDP. In 2011, Malaysia’s
exports included electronics (34.5per cent), petroleum-related products (9.9per cent), palm oil (9.3per cent)
and chemical products (6.9per cent). Malaysia is also among the world’s 20 largest trading nations, and its
economic performance was ranked 7thout of 59 countries in 2011. The World Competitiveness report of
2011 ranked Malaysia among the top five most competitive nations in the Asia-Pacific region. Some reasons
advanced for this success are Malaysia’s ability to manage consensual democracy in a highly plural society
by
• The tacit agreement between Malaysia’s politically dominant Malay actors and economically dominant
Chinese actors. Under such an agreement, the state (being Malay-dominated) agrees not to over in-
dulge in productive activities (Chinese domain) and, in return, the state is allowed to disburse resources
to invest in the economic and human capital of the Malay majority.
• Malaysia’s ability to get its macroeconomy right, its consistent pursuit of liberal market ideas and its
competence in handling conflict in the post-colonial period.

Reduce the illegal exploitation of mineral resources: As noted in Chapter 2, the artisanal and
small-scale mining sector provides livelihoods for millions of people in the SADC region. However,
this sector is fraught with the informal and illegal trading chains of minerals, which have also been
linked to the fuelling of conflicts in Central Africa by the financing of military factions. It is important
that countries work together to prevent this mineral wealth haemorrhage from the region, as per the
example in Box 3.8 for Great Lakes countries. The SADC region has developed a draft framework to
address the challenges presented by the illegal trade in minerals in order to reduce the economic
losses incurred by illegality and to increase national revenues.

Box 3.8: Measures taken by Great Lakes countries to reduce the illegal exploitation of min-
eral resources (Franken and others, 2013).
In November 2006, the eleven member states of the International Conference on the Great Lakes Region
signed the Protocol against the Illegal Exploitation of Natural Resources. The two initiatives aimed at ensur-
ing both transparency and responsibility in the trading chains of metal ores linked to the financing of conflicts
are (1) the development of a geochemical fingerprint for coltan ores and (2) a chain of custody assurance
systems (certified trading chains), based on the establishment of transparent, traceable and ethical trading
chains. Since 2000, the region has developed into a significant supplier of coltan (tantalum ore concentrate)
for the world market.

As the coltan has also become a source of revenue for military groups, the region has introduced fingerprint-
ing to identify the origin of a concentrate by comparing its mineralogical and chemical characteristics with
samples of known provenance that are stored in the coltan database. This method has also been adapted
for tin and tungsten ores.

Reduce tax evasion by mining companies: This can be achieved through the introduction of
auditing mechanisms. Similar to the Chilean approach, the region could introduce a Bill on Transfer
Pricing and create a specialized unit comprised of economists, lawyers and accountants that would
be in charge of conducting transfer pricing audits to curb the loss of wealth. This could be based on
the OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations of July
2010, in which the accepted methods are: comparable uncontrolled price method, cost plus meth-
od, resale price method, transactional net margin Method, and profit split method, with the most

69
appropriate method being selected based on the underlying transaction. Furthermore, the capacity
of state institutions to audit the mineral value chain should be strengthened.

Transparent management of mineral resources revenues: Transparency in the management

of the sector along the value chain including contracts is important. Mineral production should be
declared the same extent as revenues, and taxes and should be royalties paid. Sierra Leone created
an internet database for mining contracts that would allow the public to access revenue data for the
country’s extractive industry, covering everything from license payments, to contributions made to
local traditional leadership structures (Ecobank, 2013). Figure 3.3is an example of the information
displayed by the government website on licences issued and government revenues derived from
issuing licences. Such transparency helps both the public and industry to follow developments in
the industry, including how revenues earned are applied. The declaration of revenues collected by
the Government of Sierra Leone from the sector allows for public scrutiny of how those revenues are
used.

Figure 3.3: Transparency in Sierra Leone’s government revenues

Source: Ecobank, 2013.

SADC Member States should improve transparency in the awarding of licences and in auditing
transactions. Regional and international mechanisms for governance of the sector including the Ex-
tractives Industry Transparency Initiative and APRM should be domesticated.

Enhance the exploitation of forestry resources

As noted in chapter 2, the challenges include the centralized management of forest resources; illegal
logging and out-flight of timber without paying taxes; the lack of skills by local people; the lack of
access to finance to invest in improved technologies; and rampant deforestation. Table 3.1 outlines
examples of measures being undertaken in the SADC region to curb forest degradation (SADC/FAO,
2013). A central feature of these programmes is the intimate involvement of the communities.
Table 3.1: Examples of management measures for sustainable forestry by SADC Member

70
States

Country Forest management measures

• Adaptive options for rangelands include the manipulation of livestock densities and the in-
Botswana troduction of grazing controls
• Community-Based Natural Resource Management CBNRM)
• Forestation of cashew trees (clean mechanism of development)
Madagascar • Forestation with paulownia spice (clean mechanism of development)
• Extension of protected areas in Madagascar to 6million hectares
Upper and Middle Shire Valleys heavily deforested, resulting in heavy siltation and trash accumu-
lation at the water intake dam of the hydroelectric power plant on the Shire River, leading to fre-
quent power outages. Proposed interventions in the area therefore include:
• Community-based management of protected areas (with revenue-sharing incentives)
Malawi
• Afforestation activities
• Improved extension services to ensure sustainable land and forest management,
• Forest fire management at the community level
• Periodic monitoring of plant development.
• Reforesting an area of 1.3 million hectares by 2030
• Awareness-raising programmes against wildfires
• Community-based forest management with incentives
Mozambique • Improve rangeland management measures including an alternative to grazing systems,
changes in stocking rates, changes in the timing of the grazing period, and changes in the
genotype of cattle
• Capacity-building to increase the ability of rural communities to cope with climate change
• Forest protection to curb deforestation
• Reforestation through forest regeneration and rotation
Swaziland
• Provision of alternative energy sources such as bioenergy
• Community-based forest management with incentives
United Republic Presidential award competition for the conservation of water sources and the planting of trees
of Tanzania and ensuring their survival
• Introducing forest policy and legislation to implement participatory approaches, private-pub-
lic partnership programmes (PPP), devolution of programmes to grassroots, climate change
mitigation/adaptation, and carbon management factors are among other issues related to
sustainable forest resource management.
• Integrated Land Use Assessment operations to generate data on deforestation rates, soil car-
Zambia
bon and land classification types
• Incentivized community participation in tree planting to expand the local supply of planta-
tions and agroforestry interventions throughout the country.
• Improving forest ecosystem functions and biodiversity conservation using best practices for
sustainable forest management.
Afforestation and reforestation programmes through schools, competitions and special com-
memoration days (e.g. since 2005, an average of 8.1 million trees has been planted per year with a
survival rate of about 65 to 70 per cent for those planted.

Zimbabwe The development of a climate change-resilient tree variety (fast-growing tree species of pine and
eucalyptus which are both drought and pest-resistant)

The conservation and management of natural resources (restoration of deforested and degraded
land, zero tolerance to anthropogenic disturbances such as overexploitation of plant biodiversity)
Source: SADC/FAO, 2013.

As noted earlier, policies that can stimulate the contribution of inclusive growth in the SADC region
include secure access to land, reforestation, skills development and value addition, In addition, SADC
Member States need to accelerate policy support to develop production and marketing efficiencies
and help to determine fair product values for areas where people are already economically active on

71
the ground. There is also a need to assist producers of forestry products with training to improve their
quality of products so that the products can be competitively traded regionally and internationally.
Infrastructure will also be important so that forestry products can be economically transported to
markets.

Afforestation and reforestation programmes will also be necessary to restock forestry so that people
can continue to derive support their livelihoods from forestry. In Zimbabwe, for example, afforesta-
tion and reforestation programmes have been successfully implemented via schools, competitions
and special commemoration days. Since 2005, an average of 8.1 million trees have been planted per
year with a survival rate of about 65 to 70per cent for those planted (SADC/FAO, 2013).The devel-
opment of a climate change-resilient tree variety (fast-growing tree species of pine and eucalyptus
which are both drought and pest-resistant) should be prioritized.

The region should also work collaboratively to stop illegal logging and trade, both of which reduce
the wealth of these countries.

Enhance Exploitation of Wildlife and Tourism

Wildlife and tourism are a crucial source of employment, foreign exchange earnings and revenues
generated from other supporting activities. The wide range of the region’s unique features of wild-
life, culture, landscapes, water and other attractive natural resources if well promoted have signifi-
cant potential to contribute to improving livelihoods. A policy environment that facilitates the good
management of natural resources can increase regional tourist patronage and expand the volume
of tourism business. Furthermore, political stability, the professional and competitive packaging of
tours and ease of travel are important ingredients for the promotion of tourism. Box 3.9 shows that
ecotourism generates employment and enhances livelihoods.

Box 3.9: South African experience with private protected ecotourism areas(IUCN, 2005)
A survey of seven ecotourism-based private protected areas in South Africa to identify key attributes and
challenges resulted in the following findings: 1) the top three attractions of private reserves were wildlife, scen-
ery and high-quality accommodation / service; 2) establishing a reserve was a costly undertaking, requiring
an average initial outlay of US$4.6 million; 3) the switch from farming to wildlife-based ecotourism increased
employment numbers by a factor of 3.5, the average value of wages paid per reserve increased by a factor
of 20, and the average annual salary more than quintupled from US$715 to US$4,064 per employee; 4) the
reserves contributed more than US$11.3 million to the regional economy per year; 5) the reserves made a
substantial contribution to biodiversity conservation; and 6) the lack of support by government entities was
the most pressing challenge faced by reserve owners. This survey points to ecotourism as an economically
and ecologically desirable alternative to other land uses, while also highlighting the need for governments to
provide assistance and support for both the establishment and management of private reserves.

As noted by FIAS (2006), the SADC region can exploit the economic benefits along the value chain
of this sector by improving services including handling frontier applications; up-skilling local tour
operators and travel agents; networking with international/local air transport and airport services;
offering conducive and competitive accommodation services and improving other ancillary services.

In addition, policy inadequacies for managing transfrontier conservation areas should be addressed
by reducing cross-border power imbalances, strengthening institutional frameworks to support the
coordination and implementation of the programmes industry, and strengthening capacities for the
implementation and enforcement of policies and legislation. Furthermore, the sector also needs to
improve infrastructure in tourism areas, minimizes conflicts within and across communities, improve

72
transparency when determining dividends among stakeholders, improve access to financing oppor-
tunities for rural communities and disadvantaged groups, and improve the sharing of information on
good practices.

Enhance utilization of water resources

Water resources hold considerable potential to contribute to inclusive growth in SADC through var-
ious economic activities. Some of these, such as fishing, are participatory where they exist and can
play a big role in broadening opportunities for inclusive growth. To improve the contribution of wa-
ter resources to inclusive growth, the various river basin and other water management institutions
should be well resourced and their capacities improved to ensure efficient management of this crit-
ical resource. It will also be important to share information on best practices in water management
and conservation in the region, such as Namibia’s water conservation approach cited in Box 3.10.

Box 3.10: Windhoek leads the way in water and energy conservation in SADC (UN-Water,
2014).
Windhoek, the capital of Namibia, is located in an arid region, and Namibia is itself the most arid country in
SADC. Windhoek has successfully applied integrated urban water management, which includes diversifying
its water sources and recycling wastewater to meet its water needs. In 1969, the city established the Go-
reangab reclamation plant, which supplied 10per cent to 15per cent of the city’s daily demand for potable
water. In 2002, the city established another plant. Today, 26per cent of the water supplied in the city is re-
cycled sewage. In 1993, Windhoek installed a dual pipe system to irrigate all the municipal parks, gardens
and sports fields with semi purified sewage effluent, thus reducing potable water demand by 5per cent to
7per cent. In 1997, the city started recharging its aquifer, which enabled the city to survive for two years
without any surface water. The reduction of water demand and the reclamation of wastewater have enabled
Windhoek to sustain its water supply system and reduce its energy consumption from the transportation of
water over very long distances and from the treatment of water from alternative sources such as seawater.

The SADC region should accelerate meeting its 2027 water targets for various uses including 11per
cent additional water storage, 75per cent of 350 million people to be supplied with clean water,
75per cent of 350 million people to access conducive sanitation services and 220 km3/year additional
water to be abstracted to meet additional demand (SADC Water, 2012). Apart from helping SADC citi-
zens meet their social needs, increasing access to water will boost the integrated economic activities
carried out and thus creating a diversity of jobs and improving incomes.

Aquaculture can be easily integrated into farmers’ primary agricultural activities and products can be
sold at the farm gates or local markets and thus provide another source of income, which diversifies
farmers’ income streams. Therefore, apart from increasing information and the training of farmers, the
region should encourage the building of dams, which will not only promote aquaculture, but the im-
pounded water can also serve multiple socioeconomic needs. For dams built on rivers, microhydros
can also be installed for microgrids to increase access to modern energy. Policy measures to promote
aquaculture should include skills development in water resource products and services. Aquaculture
is highly participatory if developed and managed well, and can absorb a large number of people in
SADC region, thus boosting the contribution made by water to inclusive growth.

Conflicts among small-scale and large-scale fish farmers should be minimized so that they both con-
centrate on synergistically managing and benefiting from the resource, as illustrated in Box 3.11.

73
 Box 3.11: Resolving conflict between small-scale and commercial fish farmers in Zambia
(WorldFish, 2014).
Lake Kariba, shared by Zambia and Zimbabwe, provides a vital source of food and income for more than
20,000 fishers, fish processors, and traders who live along its shores. The lake is also critical to Zambia’s na-
tional food security. Over the previous three decades, however, a dramatic rise in both the number and types
of fishing activities has created conflicts between the commercial kapenta fishers, semicommercial kapenta
fishers, and local small-scale fishers, many of whom are poor and vulnerable. Most recently, new commercial
cage aquaculture operations and investment in tourism along the lake’s edge have also generated tensions
over access to the shoreline and fishing grounds.

The Strengthening Aquatic Resource Governance project has worked with local fishers, businesses, tradi-
tional leaders and state agencies to address these issues by building capacity to manage conflicts before
they affect neighbouring communities. The project was able to bring people together, and the dialogue
workshops provided an opportunity for small-scale fishers to negotiate with powerful players like large-scale
aquaculture companies and reach agreements on the actions needed for equitable access to, and control
over, the resources of Lake Kariba.

By involving all stakeholders in the development of these action plans, the ‘learning-by-doing’ project strat-
egy fostered locally-owned and driven approaches for co-managing the lake’s resources. These strategies
ensure that local fishers can continue to access the fishing grounds they have depended on for decades.
The initiative has therefore helped the lake communities of Lake Kariba in Zambia to move from conflict to
cooperation, built resilience to future shocks and laid the foundation for the sustainable management of the
natural resources they depend on.

The success and sustainability of water resources and fisheries lie in ensuring that ecosystems are
preserved, especially by involving local communities in conservation efforts so that the ecosystems
continue to provide livelihoods. Box 3.12provides an example of such an approach in Madagascar.

Box 3.12: Andavadoaka community-run, self-sustaining, marine-protected area in Mada-

gascar*
The village of Andavadoaka (population: 1,200)in Madagascar is situated at the northern end of a reef sys-
tem that extends from the Grand Récif of Toliara, some 250km to the south. Aside from their enormous
biodiversity value, the Andavadoaka reefs are critical to the livelihoods and culture of the region’s artisanal
fishing community, the nomadic Vezo, whose economy is entirely marine-based.

Traditionally, the Andavadoaka economy has relied on selling dried fish, sea cucumbers and octopus to
collectors from inland Madagascar. Since 2002, however, a Reunion-based fish exportation company, has
created an entirely new and lucrative market for fresh octopus and large reef fish as well as for pelagic spe-
cies like tuna and mackerel. A collection boat now bases itself at Andavadoaka each spring tide, returning to
Toliara twice a month with up to 35 tons of seafood. In addition to this new market force, a recent growth in
visitor numbers to the area’s two hotels has increased Andavadoaka’s reputation for coastal tourism.

In view of current potential threats to the region’s reefs and as a priority under the National Strategy for the
Conservation of Biodiversity in Madagascar, Blue Ventures Conservation and Madagascar’s national marine
research institute (the Institut Halieutique et des Sciences Marines - IHSM)are supporting the community
with data for use in local environmental management plans.Thepartnership aims to identify strategies and
targets that the local community can work towards to develop sustainable local environmental management
plans for Andavadoaka’s unique marine and coastal environment. Activities focus on improving the quality
of life of the local communities who depend on the area’s marine resources while maintaining the biological
diversity and productivity of the reefs. This means that the environmental and cultural heritage is not only
protected, but the incomes of the Andavadoaka local people have also increased.

* www.globalgiving.org/pfil/1236/projdoc.pdf.

74
Poaching is one of the economic leakages from the sector inhibiting sustained contribution to in-
clusive growth. The region needs to step up measures to minimize this loss. Box 3.13is an example of
the commendable action taken by SADC countries against illegal, unreported and unregulated (IUU)
fishing.

Box 3.13: Regional actions to reduce IUU fishing in SADC marine waters
Encouraging SADC actions against IUU fishing that is taking place have recently been noticed, including (i)
the operational vessel monitoring system (VMS) data-sharing protocol between South Africa and Mozam-
bique (Boto and others, 2012), (ii) the bold capture of an illegal fishing boat, Antillas Reefer, by Mozambique,
(iii) denial of port access to the suspected IUU fishing vessel F/V Premier by Seychelles (Stop Illegal Fishing
(SIF), 2013), and the publication of detailed information on Seychelles flag fishing vessels for 2013 and a list
of licensed fishing vessels on the Seychelles Fishing Authority webpage. The sharing of this information is in
line with regional fisheries agreements and supports the objectives and results of the FISH-i Africa initiative.

To circumvent the negative effects of overfishing and habitat destruction, the need for livelihood op-
tions outside of the fishing sector will ensure the quality, diversity and availability of fisheries resourc-
es for present and future generations (Merle and others, 2010). There is an opportunity to increase
the value of the products from fishing through increased quality control and value adding. There
are also many sustainable alternatives to fishing, which are yet to be properly explored in Southern
Africa. Marine ecotourism ventures and marine protected areas are increasingly considered viable
livelihood alternatives for many fishing communities (water recreation is another area that needs to
be developed in SADC). In South Africa, for example, about 500,000 people participate in recreational
fishery (WWF, 2011).

The collection of data for fisheries statistics and proper scientific research remain major constraints
often hampering the recording of accurate fish production and scientific data and affecting the plan-
ning and management of fisheries and aquaculture resources. In some countries, the need to identify
untapped or underexploited fish resources and to cater for the ever-increasing demand for fish is be-
coming essential. The assessment of the presence and abundance of specific fish resources is there-
fore crucial. In most countries, furthermore, a key factor of success for the improvement of fisheries
management is the involvement and empowerment of local communities as mentioned earlier, by
setting up co-management mechanisms to help monitoring stock status and changes.

Regional projects aimed at strengthening fisheries administration research capacity and the availabil-
ity of reliable data on resources need to be accelerated. For instance, Mauritius has been assessing the
distribution and abundance of bigeye tuna found in Mauritian waters and trying to determine the
appropriate gear for its capture and providing capacity building in fishing techniques to local fish-
ermen. Additionally, in Lesotho and Botswana, ACP Fish II supported the set-up of more appropriate
fish stock monitoring systems and programmes, which are able to promote the closer involvement of
local communities and co-management approaches as a major long-term sustainability factor (SADC
Water, 2012).

Overall, water use in agriculture is consumptive, and irrigated agriculture will therefore claim large
quantities of water for food production. However, water-saving technologies are available and can
significantly reduce waste. Solutions for sustainable allocation of water among users have to be se-
cured. Reforming efforts include the institutional changes with the transfer of operation and main-
tenance responsibilities to water users, and new cost-recovery approaches. Low cost and small-scale
options in water harvesting, irrigation and drainage are necessary for small rural communities, who
may have to rely only on manual and animal power (e.g. treadle pumps).Poor irrigation and drainage
have led to water loss and also to the spread of water-borne diseases, waterlogging and salinization
75
of nearly 10per cent of the world’s irrigation land, thereby reducing productivity (FAO, 2002). Im-
proved design and the management of irrigation and drainage systems should therefore be a priority
in SADC region.

Increase use of renewable energies

The power deficit and competitive costs of producing power from renewable energy sources create
an immense opportunity for inclusive growth through independent power production and supply
by microgrids connected to main grid lines. The SADC region presently requires 42per cent (63 GW)
of additional hydropower to be generated by 2027. This represents an opportunity to generate pow-
er from other renewable energies to close this gap and, given the region’s renewable energy resourc-
es outlined in Chapter 2, capacity exists. The energy generated will be used for productive and con-
sumptive purposes, thus enhancing the livelihoods of people. In addition, the renewable energies
themselves directly generate jobs. The opportunity for decentralized power also increases accessi-
bility to modern energies in rural areas where, in some cases, access is currently less than 5per cent.
Access to modern energy improves productivity and expands business opportunities such as down-
stream processing, cold preservation of food, and improved medical and educational services in rural
areas. For many rural communities, small-scale, off-grid power solutions could be both cost-effective
and environmentally friendly and, with the right investments, could make SADC a global leader in
renewable energy.

The use of national and regional renewable energy resources should therefore be an important
theme for SAPP strategic planning not only at the regional level, but also in Member States. The
region needs to consider renewable energy resources as strategic areas of investment for securing
employment and regional development, and therefore inclusive growth in the region.

For renewable energies to make a meaningful contribution to inclusive growth, a number of mea-
sures are required including creating conducive renewable energy policies, developing mega and
micro renewable energy infrastructure, popularizing decentralized power systems, facilitating access
to finance and creating markets. In 2012, the Energy Ministers of SADC and the East African Com-
munity (EAC) formally agreed to establish similar regional renewable energy and energy efficiency
promotion programmes. In addition, SAPP has also committed to promoting renewable energies as
an alternative source of power.

The SADC Protocol on Energy of 1996, SADC Regional Cooperation Policy and Strategy of 1997, En-
ergy Activity Plan of 2000, Decisions of the Committee of Energy Ministers, RISDP of 2005, Regional
Energy Access Strategy and Action Plan of 2010, SADC Biofuel Decision Making Tool of 2010, Frame-
work for Sustainable Biofuels of 2010, RESAP and the Energy Sector Plan of the SADC Regional Infra-
structure Master Plan of 2012 all provide and advocate for the development of renewable energy in
the SADC region. For example, SADC RISDP (2001) commits to improve “access to affordable energy
services for rural communities through rural electrification and the development of renewable and
low-cost energy sources including solar biomass and wind”, and that “70per cent of rural communi-
ties should have access to modern forms of energy supplies by 2018” through various measures. The
measures to achieve these targets include the development and implementation of rural electrifi-
cation programmes and research and technology development on renewable energy sources, and
piloting of existing technologies. The SADC Energy Sector Plan of the SADC Regional Infrastructure
Master Plan proposes strategic priority goals to address the energy infrastructure gaps including (i)
exploiting abundant renewable energy resources to increase clean energy in the generation mix and
also to contribute to clean energy access, (ii) regional manufacturing of renewable energy products,
(iii) making available adequate grid capacity for connecting renewable energy plants, (iv) developing
76
dedicated institutional framework for renewable energy and energy efficiency, and (v) instituting
R&D and testing facilities for renewable energies. Energy savings is another important area. SADC
RESAP proposes reaching electricity savings of 5per cent by 2015, 10 per cent by 2020 and 15per cent
by 2030 of total electricity in the sectors that use electricity compared to the established baseline
(SADC, 2012a). The region has developed RESAP to contribute to energy supply security, stimulate
economic growth and improve access to modern energy services, taking into consideration new
developments in the subsector such as the entry of biofuels into the market, funding mechanisms
and considerations for climate change (SADC, 2012a). Table 3.2 shows the RESAP targets for the de-
ployment of the least-cost renewable energy options. It has also stipulated the necessary planning
to boost deployment and the necessary policy and strategy options needed.

Table 3.2: RESAP targets (percentage) for least cost options

Least cost option 2015 2020 2030

Renewable energy mix in the grid 21 33 39
Off-grid share of renewable energy 2.5 5 7.5
Energy efficiency savings achieved from grid use 5 10 15
Biofuels
Ethanol share of total fuels 10 20
Biodiesel fuels share 5 10
Cooking/heating efficient devices penetration 5 10 15
Efficient charcoal production share 5 5
Source: SADC, 2012a.

The ECOWAS region, thanks to the Centre for Renewable Energy and Energy Efficiency, has made
headways in promoting renewable energy, including mini hydro projects and bioenergy projects.
In the ECOWAS region, renewable energy microgrids, which are smaller than in scale but able to
service multiple homes or a small business enterprise, are increasingly used as options for providing
electricity to people in isolated areas. For example, Mali’s rural electrification programme has brought
electricity to 740,000 people in the last six years, primarily with off-grid systems, thereby increasing
the share of people with electricity access in rural areas from 1 per cent to nearly 17 per cent (REN21,
2013). While currently only 3 per cent of the electricity is derived from renewable energy in Mali, the
share of renewables in the mix is set to rise to 10 per cent by 2015.

Box 3.14 describes a bioenergy project in Sierra Leone where bioethanol and electricity are being
produced from sugarcane. Apart from job creation and other benefits, these renewable energy proj-
ects have resulted in the expansion of agricultural activities and the country is also benefiting from
excess power sent to the national grid for access by other industry and people in general, thus in-
creasing productivity and other energy-dependent opportunities in these countries. Other examples
in the region include the Cabeólica Wind Farm Project in Cabo Verde, which taps the country’s abun-
dant wind resources.

77
 Box 3.14: Sierra Leone develops Africa’s largest sugarcane plantation for bioethanol (AfDB,
2013b)
The Addax bioethanol project consists of 10,000 ha of irrigated sugarcane estates and an ethanol factory
capable of producing 90,000 cubic meters of ethanol per year and, from the bagasse waste by-product,
32 MW of nominal electrical power capacity, of which 15 MW will be available for sale. In addition, 2,000
ha will be developed as part of the project’s Farmer Development Programme, which will focus on rice and
cassava and is being implemented with the support of FAO to ensure food security in the project area. An
additional 1,800 ha will be set aside for ecological corridors and buffer zones to protect existing pockets of
biodiversity.A key element of the programme has been agreement with local communities on land leasing ar-
rangements. Addax has leased a total of 57,000 ha for the project, much of which will remain undeveloped.
The Addax project will directly pay landholders rent for the land they lease. The Addax project will broaden
electricity supply throughout the country and enhance productivity in agriculture in the country.

Biomass-based renewable energy: Bioenergy plants that convert biomass to heat and electricity
are an important area for promoting inclusive growth. According to Kerlero de Rosbo and De Bussy,
2012), in Rwanda, a bamboo-based biomass power generation was successfully tested in 2010. The
project involved planting a minimum of 50 hectares of bamboo for use in generating electricity for
a minimum of 100 households, training local communities to make bamboo products and furniture,
and introducing bamboo charcoal into local markets as a substitute for wood charcoal. The bamboo
was employed for electricity generation using two options. The first option was a combustion path
involving high-load constant power production from 70 kW upwards, bringing light to 100 house-
holds including economic activities with constant needs, requiring a microgrid to connect businesses
and electrical blocks. The second option was a gasification path involving flexible power production
from 20 kW upwards, bringing light to 100 households with limited microeconomic activities and
requiring a grid to electrical blocks, or a battery or lamp renting system. Both options needed only
one or two hectares of bamboo per year to supply a power plant of this size. The broader bioenergy
industry includes biomass suppliers, processors and firms that deliver biomass to end-users; man-
ufacturers and distributors of specialist biomass harvesting, handling, and storage equipment; and
manufacturers of appliances and hardware components for plants that convert biomass fuels into
usable forms and energy services (REN21, 2013). Some parts of the supply chain use technologies
that are not exclusive to biomass such as forage crop and tree harvesters, trucks, and steam boilers.

To entrench inclusive growth programmes in the renewable energy sector, it is important to attach
local training for repair and maintenance of small renewable energy systems, which is important be-
cause service costs in remote areas and islands are often prohibitive (REN21, 2013).

Solar and wind: Falling solar PV prices render even relatively small installations more affordable. Fall-
ing prices, efficient light-emitting diode (LED) lamps, and battery improvements can be combined to
provide accessible, lightweight, reliable, and long-lived solar lanterns that can meet the basic needs
of many people, usually at lower cost than conventional kerosene-based alternatives. Solar pico-PV
systems, which produce up to 10 W and are easily self-installable and usable, can be populated in a
broad range of capacities in the region. They can be put to a variety of uses such as powering offgrid
medical clinics, as is being done in some places in SADC region.

In Lesotho and Madagascar, plans are under way to add wind to existing minigrid systems (REN21,
2013).Such efforts need to be stepped up in the region for increased contribution to inclusive
growth. According to REN21 (2013), even in areas with limited infrastructure, growing numbers of
medium-scale wind systems can be transported, installed, and maintained, with generation costs as
low as US$ 0.10/kWh.

78
Biogas: Globally, approximately 48 million domestic biogas plants for rural electrification and cook-
ing have been installed since the end of 2011 for rural electrification, with the vast majority of these
in China (42.8 million), India (4.4 million) and smaller numbers in Cambodia and Myanmar (REN21,
2013). Biogas plants are based on simple technology and continue to increase in number where
households and commercial farms have access to sufficient animal manure for fuel. Additionally, solid
biomass applications for drying and curing continue to grow in number. SADC can consider popu-
larizing such initiatives to improve access to clean energy in rural areas, which can also stimulate the
processing of agricultural products.

Ethanol for cooking: Ethanol can also be used as a cooking fuel instead of traditional solid biomass
and charcoal. In Mozambique, an ethanol plant with production capacity of almost 2 million litres
per year opened in early 2012 (REN21, 2013). The ethanol company buys surplus cassava feedstock
from about 3,000 local farmers and sells the ethanol fuel and clean cooking stoves at prices that are
competitive with the local retail price of charcoal.

At the regional level, the management and costs of grid construction and power and delivery through
main grids can be shared via the Southern African Power Pool (SAPP). The SADC region has a large
elasticity to localize the production of inputs for renewable energy, but only South Africa has invested
in localizing the manufacturing of renewable energy technologies. A regional strategy targeting this
goal could be adopted to benefit from economies of scale.

Hydro-based renewable energy: For hydro-based power generation, several SADC countries can
benefit from their natural endowment of a myriad of rivers and streams to generate power. With
appropriate policies in place, low levels of technology and the financial requirements for mini, micro
and pico-hydropower generation offer ready opportunities for inclusive growth in the region.

Mini (ranging from 100 kW to 1 MW), micro (ranging from 5 kW to 100kW) and pico (under 5 kW)
hydropower are now recognized as key technologies in bringing renewable electricity to rural popu-
lations in developing countries. The World Bank Energy Unit ranks picohydro as the least cost solution
among offgrid rural electrification technologies (Lwamba, 2013).Small water flows are required for
minihydros, and there are many suitable sitesin the SADC region. Picohydro equipment is small and
compact and therefore portable. A wide promotion in the region can create sufficient economies of
scale leading to local manufacture, which would help keep down equipment cost proportional to
local wages. The design principles, technology and fabrication of these scales of hydropower systems
are easy to learn. The capital and maintenance costs are low since the systems are for small commu-
nities, typically less than 100 households. They boast the least cost for offgrid rural electrification.

Given the large resource base of renewable energy sources in the region, opportunities abound for
renewable energy-based inclusive growth in the region. With the appropriate policies and invest-
ment support, the SADC region can easily become a world leader in this sector.

Maximize the contribution made by human capital to inclusive

growth
Raising productivity, innovation and, therefore, growth in the SADC region is closely linked to Prin-
ciple 4, namely to “Maximize the contribution made by human resources to inclusive growth”. If mil-
lions of poor SADC people become more economically productive and enter the middle class, the
region will experience net economic growth. This expansion of the economy results in growing mar-

79
kets, and the production of new goods and services creates forward and backward linkages in the
regional economy.

The primary goal of economic development in the region must be to create the most productive,
efficient, high-growth economy possible. This can be done by increasing productivity and growth
through the full employment of underutilized human capital.

Invest in education, skills development and R&D: Economic growth will occur by increasing
the productivity of individuals, businesses and institutions. Productivity growth, particularly in the
knowledge economy, flows from investment in R&D and innovation, technological infrastructure,
knowledge institutions and networks, and human capital44. Human capital is especially important, as
it is the knowledge and skills embedded in the labour force that combine with new technologies to
enable growth.

In particular, the education system should be reformed so that it becomes relevant to the regional
development agenda, the failure of which will make it difficult for SADC to meet capacity needs for
its development programs, and inclusive growth will remain elusive to the region.

Invest in both the lifespan and healthspan of SADC citizens: With poor lifespan and healthspan,
the above inclusive growth measures cannot be realized, and SADC must therefore pay particular at-
tention to these parameters. As mentioned earlier, lifespan is how long we live whereas health span
is how long we live with the best possible health; that is, when a person can perform at their best
physically and mentally. The goal for SADC should therefore be better health, not more medical treat-
ment45. Investment in healthcare should focus more on early health and less on late disease. SADC
will therefore need a much greater focus on prevention to achieve that goal, and this must be carried
out in all socioeconomic spheres of the region: at workplaces, schools and homes.

It is important for the region to introduce incentives to support and encourage its citizens to stay
healthy for enhance contribution towards productivity and development The region should strength-
en preventive mechanisms and sustain good health for as long as possible and for as many as pos-
sible. This strategy should be accomplished via better coordination of care so that even individuals
with chronic illnesses can stay healthier longer and have fewer complications46. This alone should
decrease health care spending while providing both national and regional health benefits in the
form of increased productivity using human capital.

In recent decades, furthermore, the medical sector has increasingly focused on identifying factors
that could lead to living healthier lives, including income, education, employment, insurance status,
diet, exercise, and geographic location. It has been found that it is better to keep people productive
longer than to simply prolong their lives. SADC reforms to the healthcare system should promote
this emerging view on health. Emphasizing healthspan over lifespan will result in better long-term
health outcomes in SADC. The region should thus combine prevention, innovation, and technology
to improve the long-term health, especially that related to a green-based healthspan.

The overwhelming advantage of a green-based healthspan is that it is frugal, realistic, and econom-
ically sustainable in underserved and economically deprived populations of SADC, which will be-
come the major targets of chronic illness in the foreseeable future (Fahey and Olson, 2013). The use
of a food-centred approach to stretching lifespan and healthspan can be sustainably applied in un-
44 www.stlouisfed.org.
45 www.aspeninstitute.org.
46 Ibid.

80
derserved poor populations and in the personalized medicine of the region. Plants such as broccoli
and Moringa are particularly being promoted for their high nutritional value and medicinal proper-
ties (Box 3.15). All parts of the Moringa tree are edible and have long been consumed by humans
(Bey, 2010). The nutritional properties of Moringa are now so well known that there seems to be little
doubt of the substantial health benefit to be realized by the consumption of Moringa leaf powder in
situations where starvation is imminent. People in SADC will therefore not only grow medicinal and
nutritional plants for their direct use, but will also be able to expand their economies owing to the
growing global demand for such plants.

Box 3.15: Global examples of Moringa promotion

The Government of Philippines has legislated Moringa to spur its production, processing, marketing and
distribution in suitable areas of the country in order to acquire the benefits of this exceptionally nutritious and
productive but underutilized tropical crop*.

Mali has vigorously promoted the Moringa plant and has even produced a manual for its production and use
(Doerr and Williams, 2008).

John Hopkins Hospital in USA, like numerous other institutions in the world, is undertaking extensive re-
search on Moringa for medicinal and nutritional uses of the plant (Fahey and Olson =, 2013).

* http://senate.gov.ph/lisdata/1588013119!.pdf

Promoting inclusive growth

Policy measures to strengthen the inclusive growth potential of the extractive sector include local
content to raise the retained value of an investment in the SADC region, the share of information on
good practices, product and service-focused training to increase the ratio of productive skills, local
and regional market development to increase the volume of business, quality assurance to broaden
the market by increasing product acceptability, access to collateral finance to attract and raise invest-
ment funds, industry infrastructure to facilitate functional industry, industry transparency to unlock
ideas and investment, and research, development, demonstration and deployment to provide local
solutions.

Ensuring social inclusion is indispensable for inclusive growth to provide equal access to opportu-
nities and welfare distribution in the context of various natural resource welfare schemes, especially
when the latter are provided by governments. This distribution involves multiple layers of decision
makers from the centre to state, district and village level. Social inclusion needs to be strengthened
throughout these layers of public administration so that the intended benefits can reach the target-
ed people and rural populations.

Principle 5 advocates inclusive growth that is sustainable, which calls for a green approach to the
exploitation and use of natural resources. The exploitation of natural resources is directly and indi-
rectly associated with environmental degradation, albeit to various degrees. Consequently, if issues
of environment and sustainability are not embedded in the SADC inclusive growth agenda, growth
in the region will continue to degrade the environment and deplete resources critical to the inclusive
growth-based welfare of current and future generations.

Natural resource-based inclusive growth must not be short-lived, but should ensure that the natu-
ral assets of the earth are able to adequately provide the natural resources and ecosystem services
on which humans depend, which thus calls for green growth. AfDB has defined green growth as
81
enabling sustainable growth and creating prosperity by taking a holistic approach to development
– valuing human, social and natural capital, efficiently and sustainably producing goods and services
and building resilience in a changing and increasingly interconnected world (AfDB, 2013b).

Green inclusive growth is essential to the SADC region, which is highly vulnerable to climate change
owing to its high dependence on natural resources; land and agriculture; water and forestry. Further-
more, the region faces severe economic, social and ecological threats, ranging from energy, food and
water insecurity to extreme weather risks (AfDB, 2014). Although the region currently contributes
only minimally to the emission of global greenhouse gases, it is increasingly becoming a source of
global economic growth and is thus becoming trapped into conventional economic growth pat-
terns which increase these emissions and is tending to rely on more intensive and less sustainable
use of natural resources. An example of green growth agriculture by Burkina Faso and Niger is pre-
sented in Box 3.16.

Box 3.16: Towards green growth in Burkina Faso and Niger (AfDB, 2014)
In Burkina Faso and Niger, community-based knowledge in the form of traditional practices and experimen-
tation by small farmers has helped transform the Sahelian region into productive agricultural landscapes.
The protection of trees, the digging of pits to concentrate manure, and the construction of contour bunds to
control rainfall and run-off to combat erosion were innovations that “sustainable intensification” programmes
can be built on.

To promote a green inclusive growth, the SADC region will therefore need to adopt climate-smart
and sustainable agriculture, sustainable land and water management, the use of renewable energy
and improved energy efficiency, fuel-efficient and less polluting public transportation, and the main-
tenance of ecosystems and biodiversity protection in the region’s development agenda.

Summary
This chapter has argued that inclusive growth is founded upon broad-based growth across all sectors
of the economy and has a productive distributional aspect that aims to reduce income inequality in
society while ensuring the sustainable exploitation of natural resources. It noted that measures to im-
prove inclusive growth in the SADC region should involve assessing natural resources development
options with the best output for the benefit of locals, prioritizing natural resource-based industries
with sustainable markets, prioritizing locals throughout the value chain, retaining maximum possible
value from exploited natural resources within the local economy, and ensuring maximum and envi-
ronmentally-friendly productivity by human capital within that locality.

This chapter also observed that, for land and agricultural development, measures such as facilitating
access to secure land, improving land tenure and administration, enhancing access to capital, pro-
moting integrated land management and use, addressing gender imbalance in land ownership, and
prioritizing local investment are key strategies. For mineral exploitation, strategies should include:
higher local value addition and local linkages; designing optimal fiscal frameworks; diversifying the
economy; enhancing the ability to audit the mineral value chain; monitoring of transfer pricing. Fur-
thermore, enhancing local participation in the sector through local content policies and providing
support to the small-scale mining sector would strengthen inclusivity. For the forestry sector, im-
proving secure access to land, promoting reforestation, developing skills, increasing the participation
of locals and adding value will contribute to inclusive growth. Improving the policy framework for
management and access to resources, enhancing skills of local stakeholders, promoting the involve-
ment of locals in the management of wild life and tourism resources, and improving other ancillary

82
services will strengthen the contribution of forestry and tourism resources to inclusive growth. For
water resources, improved management of water resources and basins, investment in low-cost and
small-scale options in water harvesting, and investment in micropower schemes will improve water
utilization and access to energy. For the renewable energy sector, this chapter advocated the cre-
ation of progressive policies; developing both the mega infrastructure and micro infrastructure for
renewable energy; popularizing decentralized power systems; and facilitating access to finance and
creating renewable energy markets. The chapter also emphasized the importance of human resourc-
es in inclusive growth and called for increased investment in education and skills development, and
in raising the lifespans and healthspans of SADC citizens. Importantly, the report underlines that that
sustainability issues need to be embedded in the SADC inclusive growth agenda for both intergen-
erational and intragenerational equity.

83
Chapter 4: Conclusions and Recommendations
Conclusions
This study has shown that the SADC region possesses vast mineral, land, forestry, water and wild-
life resources and ascertained that the exploitation of these resources could contribute to inclusive
growth and address the subregion’s development challenges, drawing inspiration from what has
happened in other countries in the world. The resource-based industrialization experience of South-
East Asia and the resultant improvement in the living standards of this region’s population is well
documented and provides important lessons for the region. Indeed, many countries in the world
have deployed wealth derived from the exploitation of natural resources for socioeconomic devel-
opment and inclusive growth. As noted in this study, these efforts have been supported by good
institutions and good governance, supportive infrastructure and fiscal policy frameworks, business
competitiveness, the well-directed deployment of resource revenues including windfall income, and
broad-based development programmes with the full participation of SADC citizens. As a result, a
well-managed regional natural resources exploitation strategy underpinned by inclusive participa-
tion represents a real opportunity to expand both the national and regional economy and address
poverty and underdevelopment. The study also alluded to the high levels of poverty and inequality
in the region despite positive and sustained economic growth in most Member States during the
last decade. It is important that the benefits of the current positive economic growth patterns are
harnessed to provide the basis for strengthening overall inclusive growth. Land and agriculture, min-
erals, forests, wildlife, water and renewable energy resources can all be harnessed efficiently to drive
inclusive growth.

Land is an important asset and forms a base for accessing and exploiting other natural resources. Eq-
uitable and efficient access to land for all is thus cardinal for inclusive growth and development in the
region. The impediments to accessing land for productive use should be addressed to facilitate opti-
mal use. The agricultural sector relies on access to land and thus enhanced access will address food
production and food security issues. Supportive agricultural policies including those that address
financial and technical constraints to productivity will further strengthen the role of the sector as a
source of sustainable livelihood for those in farming. For example, agricultural marketing information
and infrastructure are major constraints in the region, resulting in the wastage of agricultural produce
in post-harvest losses, which makes the sector uncompetitive. The creation of predictable markets is
important for the sustainability of the agricultural sector. Furthermore, enhancing access to secure
land and raising the profile of women farmers who make up about 70per cent of the sector is an
important strategy for promoting inclusive growth. Other areas of intervention include improving
access to financing and inputs and technology, especially for smallholder farmers.

Although minerals are wasting assets, they can be transformed into other forms of sustainable capital
including highly skilled human capital and infrastructure via the prudent management of revenues.
While mining can directly provide employment, which is limited by the capital-intensive nature of the
sector, its greatest contribution lies in the linkages that can be created with the local economy. Min-
eral beneficiation and value addition can contribute to local infrastructure development, spur back-
ward and forward linkages to other sectors, and stimulate the development of economic clusters. In
addition, the sector is a source of foreign exchange and government revenue. Through linkages and
value addition, the minerals sector can be the basis of industrialization, economic diversification and
the growth of vibrant economic clusters. In addition, strengthening the overall participation of locals
along the mineral value chain can strengthen the role of the sector in addressing development chal-

84
lenges. Inclusive growth through the minerals sector can be deepened through fully participatory
community development agreements and corporate social responsibility programmes.

The exploitation of forestry, wildlife, water and renewable energy resources offers a myriad of oppor-
tunities for deepening inclusive growth. The latter are renewable natural resources on which human-
ity will continue to depend for their existence, and the prudent management and utilization of these
resources will deepen developmental impacts. The development of industrial clusters based on these
natural resources is crucial for the SADC region to benefit from economies of scale and linkages. The
multipliers from such industrial agglomeration will generate further opportunities for SADC citizens.

As observed in the report, skilled manpower is a key ingredient to inclusive growth and develop-
ment. Appropriate knowledge and skills are important to convert natural resources into products
and services efficiently. Skills development programmes should thus be a component of any inclu-
sive growth strategy, as skills improve the utilization of resources. Agricultural skills enhance food pro-
ductivity, and industrial skills enhance value addition. RD, D and innovation are necessary to provide
local solutions and the required support to industrial development, which should be underpinned
by a strategy to develop highly skilled manpower. Scientific progress and industrialization cannot
be divorced from skills training, which means investment in science, mathematics, technology and
engineering is important. In addition to skills, the health of the population is an important factor in
overall productivity. If the lifespan and healthspan of SADC citizens are short, investment in inclusive
growth and development in general will be expensive. It will therefore be necessary to boost both
the lifespan and healthspan, not only to minimize the human capital cost, but also to achieve high
levels of productivity.

However, one of major constraints to industrial development in the region is the huge infrastructure
deficit, especially electricity and transport deficits. This situation therefore requires strong collabora-
tion among stakeholders. For example, public-private partnerships can accelerate infrastructure de-
velopment, which will in turn facilitate and underpin industrial take-off in the region. Well-developed
national and cross-border infrastructure is necessary to stimulate a vibrant natural resources-based
industry in SADC. Furthermore, the harmonization of regional standards and the competitive quality
of regional products and services will accelerate growth of the natural resources-based industry in
the region.

Recommendations
As argued throughout this study, the SADC region can take advantage of those natural resources
where it has comparative strength to positively and sustainably transform its economic path as an
initial trajectory to enhancing inclusive growth. The following policy recommendations are proffered
for Member States and other national stakeholders, the SADC secretariat and for development part-
ners to help strengthen the contribution made by the exploitation of natural resources to inclusive
growth in the region.

Actions by SADC Member States

SADC Member States have to invest in stabilizing both individual and household incomes by prior-
itizing natural resource-based industries with predictable markets as a catalyst for inclusive devel-
opment. This approach will cushion SADC citizens from the impacts of cyclical commodity prices.
Where possible, Member States should establish distributed off-take agreements according to their
geographical advantages and strengths to stimulate wider-ranging access to business opportuni-
ties in the region, focusing initially on geographical areas where these resources exist. This situation
85
requires an inventory of resources to determine the adequacy of the throughput in economic quan-
tities. The creation of renewable natural resource-based industries will help broaden the basket of as-
sured markets, which will in turn increase opportunities for the majority to be engaged in this sector.

Furthermore, SADC Member States need to develop mechanisms to optimize revenues from the
resources sector and utilize these revenues for skills and infrastructure development and for research
and development. The creation of efficient tax systems that are sufficiently flexible to capture windfall
benefits is an important prerequisite for the extraction of optimal rent from the sector. Furthermore,
the creation of sovereign wealth funds is a viable strategy for ensuring intergenerational equity and
cushioning economies from the volatility in commodity prices. The implementation of the SADC Re-
gional Infrastructure Development Master Plan through the collaboration between Member States
and the private sector via PPPs could help address the infrastructure gap. Furthermore, policy frame-
works that explicitly link the development of natural resources to infrastructure can provide impetus
for value addition and beneficiation. The SADC region should aim to attain optimal local retention
of wealth through local content policies that will support and spur backward and forward linkages
and industrialization. This will increase employment opportunities in the sector, raise incomes and
strengthen the role of the sector in increasing overall regional inclusive growth. The introduction of
deliberate policies on economic diversification and the exploitation of regional commodity value
chains will be equally important as will global value chains, where feasible.

i. To improve the contribution made by the exploitation of mineral resources to inclusive growth,
SADC Member States should:

• Invest in mineral exploration to delineate the quality and quantity of mineral resources for me-
dium-term and long-term planning purposes, including the identification of areas amenable
to ASM.
• Invest revenues from the minerals sector in infrastructure and human resources development
and the diversification of the local economy.
• Develop and implement national policies on mineral beneficiation and value addition as part
of the national and regional industrialization strategy.
• Undertake mineral beneficiation studies to determine the minerals amenable to local benefi-
ciation.
• Invest in developing the capacity of government institutions to audit the mineral value chain
to minimize mineral revenue leakages.
• Strengthen corporate social responsibility frameworks to ensure that mining contributes to
social inclusion by creating local business opportunities and capacity development.
• Strengthen transparency in mineral revenue management by domesticating regional and in-
ternational mechanisms.
• Introduce mechanisms to reduce transfer pricing, utilizing regional and international mecha-
nisms.
• Develop policies to facilitate the development of clusters around mineral resources extraction.
• Strengthen environmental mitigation and management frameworks to ameliorate the adverse
impacts of mineral extraction.

86
 • Develop and implement local content policies that are linked to national development strate-
gies.
• Revise mining fiscal frameworks appropriately and introduce windfall or resource rent taxes to
capture optimal revenues from the mining sector.
• Introduce certification (formalization) to help small-scale miners to access competitive markets
and capture greater returns for their mineral products.
• Develop the capacity of host communities in mining areas on good mining practices and en-
trust them with monitoring mining activities to minimize the degradation of the environment
and natural resources owing to poor mining practices.
• Develop templates for community development programmes/agreements for communities in
mining areas to facilitate the sharing of the benefits of mineral exploitation;
• Develop the capacity of artisanal and small-scale miners for alternative sources of livelihoods.
• Develop local participation programmes with measurable indicators to facilitate the active in-
volvement of locals in the mining sector as entrepreneurs, either directly or via joint ventures;
• Domesticate the aspirations of the Africa Mining Vision on the developmental role of the min-
erals sector.

The full domestication and implementation of the Africa Mining Vision in SADC Member States will
strengthen the overall contribution made by the sector to inclusive growth, as the Vision focuses on
deepening development and socioeconomic transformation.

ii. To enhance the contribution made by the forestry, wildlife and tourism sectors to inclusive growth,
SADC Member States should:

• Strengthen management of both forest and wildlife resources of transfrontier conservation

areas and ensure the full participation of neighbouring communities in the exploitation of
resources and the management of revenues.
• Improve the sharing of information on successful best forestry management practices and in-
novative instruments and strategies for community-based participatory and sustainable man-
agement of indigenous forests.
• Develop and share practical toolkits for the participatory development of community-based
forest management plans in order to enhance the performance of the industry.
• Increase investment in skills development on forest products and services and marketing.
• Localize tourism receipts by promoting the active participation of local business enterprises in
the value chain.
• Develop policies to strengthen biodiversity preservation in the forests, as this strategy has direct
linkages with the traditional use of forests resources, including those for traditional medicine.
• Develop appropriate policies to link the exploitation of tourism, wildlife and forestry resources
with local community activities; .
• Promote and market unique features of tourism including forestry, wildlife and many other
tourist attractions.

87
 • Promote PPPs for the development of tourism and related infrastructure.
• Develop policies to promote and incentivize value addition to wildlife and forestry products.

iii. To enhance the contribution of renewable energy technologies to inclusive growth, SADC Mem-
ber States should;

• Establish regional targets for the utilization of renewable energy as part of the national energy
system.
• Improve power interconnecting infrastructure to enable independent power producers to ac-
cess wider markets by selling their production to grids.
• Promote PPPs in renewable energy to compliment the investment made by utilities via harmo-
nized policies.
• Increase funding for renewable energy technologies and broaden access to requisite financing
by increasing the role of financing institutions targeting the sector.
• Reduce tariffs of renewable energy technologies and fuels in the region.

iv. For strengthening the contribution made by land, agriculture and water resources to inclusive
growth, SADC Member States should:

• Establish public seed breeding programmes for indigenous seed varieties for the long-term
sustainability of the seed sector and incorporate indigenous community seed preservation
methods into these programmes.
• Invest in developing agricultural infrastructure including storage facilities to reduce posthar-
vest losses.
• Adhere to CAADP commitments including the Maputo Declaration on the sector and sign and
implement national compacts on CAADP.
• Provide incentives to promote the development of agro-based clusters and linkages and use
the latter to stabilize markets.
• Strengthen the link between small and commercial farmers, and food processors to facilitate
toll processing and value addition.
• Develop value addition strategies and strengthen local and regional value chains for agricul-
tural and fish products.
• Strengthen regional and international cooperation to address illegal and unsustainable ex-
ploitation of fish resources.
• Strengthen farmer support programmes including extension services, skills development, mar-
ket information and inputs to improve productivity.
• Improve access to land, financial assistance, equipment, agricultural markets by women and
young people.
• Develop skills in communities and small businesses for packaging and marketing products and
services.

88
 • Accelerate the harmonization of national water resource management policies and strategies.
• Implement the principles of IWRM in inclusive growth and sustainable development and adopt
a multisectoral approach to the management of the utilization of water resources and reorient
agricultural policies to integrate crop-livestock systems and promote the development of a
small livestock subsector, especially goats and pigs.
• Implement and accelerate land tenure reforms to enhance access to land by people and en-
hance the security of land tenure.
• Support the effective integration of small-scale farmers into large-scale agricultural value chains
by drawing from best practice-inclusive business models in the sugar industries of Malawi,
Swaziland and Zimbabwe and strengthen capacity in land survey and cadastre.
• Strengthen land use planning to facilitate access to land for various economic activities (holistic
land use planning).

The importance of human resources as a resource for promoting inclusive growth was underscored
in this study. The report specifically highlighted the importance of skills, health and lifespans in the
effective use of human resources capital.

v. To enhance the human capital contribution to inclusive growth, SADC Member States should

• Invest in RD, D and innovation, technological infrastructure, knowledge institutions and net-
works, and human capital, which will in turn increase productivity and consequently economic
growth.
• Invest in better health, provide incentives to support and encourage people to stay healthy,
focus on programmes that improve both the healthspans and lifespans of SADC citizens.
• Invest in the training of scientists and engineers to enhance natural resource conversion capac-
ity, innovation and research and development in collaboration with the private sector.
• Establish national centres of excellence for RD&D and innovation to provide local solutions to
development challenges.

Actions by RECs and development partners

The actions and strategies at Member State level should be complimented at regional level with
the support of development partners. Regional level actions are important to harmonize efforts and
ensure that the constraints caused by small domestic markets and infrastructure are overcome. Fur-
thermore, strong regional integration allows for the unimpeded movement of factors of production
such as skills, capital and technology, key inputs for socioeconomic development.

i. To enhance national programmes on inclusive growth in the SADC region, the SADC Secretariat
should:

• Accelerate regional integration and the creation of the customs union to facilitate factor flow
across the region including the free movement of people and skills.

89
 • Accelerate the harmonization national policies, strategies, fiscal, legal and regulatory frame-
works for the exploitation of various natural resources to ensure that they support inclusive
development and sustainability.
• Develop a general beneficiation framework for the natural resources sector and specific strate-
gies for different natural resources. For example, a beneficiation strategy for the minerals sector
would provide direction on local value addition to specific minerals at regional level.
• Accelerate the domestication of the Africa Mining Vision and harmonize the SADC Mining Pol-
icy Harmonization framework with the aspirations of the Vision.
• Promote regional value chains in various commodity sectors to help overcome the constraints
of smaller domestic markets and enable Member States to benefit from economies of scale.
• Strengthen data collection and the creation of repositories to minimize economic leakages
and maximize value-added contributions from natural resources.
• Commission studies to quantify the inventory of various natural resources to provide a basis for
a region-wide exploitation strategy.
• Strengthen natural resources governance in the region via international and continental mech-
anisms, for example, using the African Peer Review Mechanism to monitor the national and
regional performance of institutions and governance.
• Develop and strengthen the platform for sharing best practices in various sectors. For instance,
Botswana’s success in the diamond sector could be showcased and lessons learnt by other
Member States.
• Develop and strengthen a SADC-wide approach to capacity and skills development through
accredited centres of excellence and the development of a harmonized curriculum for training
to allow for regional recognition of expertise.
• Accelerate the implementation of the SADC Infrastructure Master Plan through PPPs to address
the constraints to value addition and beneficiation.
• Promote the fully participatory development of land policies in line with continental land pol-
icy aspirations.
• Coordinate all stakeholders, including development partners, in providing technical support to
Member States for developing the natural resources sector;
• Implement the SADC Industrialization aspirations.

ii. To enhance and strengthen the capacity of SADC Member States and the SADC Secretariat to
deepen the role of natural resources exploitation so as to contribute to inclusive growth, develop-
ment partners should:

• Provide human and institutional support for capacity development and policy harmonization
in Member States.
• facilitate interregional information sharing on best practices in natural resources exploitation
and the management of resources revenues.
• support the efforts of the SADC region in domesticating relevant international agreements
impacting on natural resources development and inclusive growth.

90
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 Annexes

100
 Annex 1: Main mineral deposits in SADC Member States
Precious metals gemstones and
Country Metallic minerals Industrial minerals
semi precious stones
Uranium, nickel, chromium, bauxite, copper, lead, Phosphate, granite, marble, salt, gypsum, lignite, mica,
Angola Diamonds, gold, silver, PGMs
iron, zinc peat, manganese
Diamonds, gold, PGMs, semi-precious
Botswana Copper, nickel, cobalt Coal, soda ash, salt
gemstones
Democratic Republic Copper, zinc, tin, nickel, lead, coltan, cobalt, tung-
Diamonds, gold, silver Coal, manganese
of Congo sten, niobium
Lesotho Diamonds Uranium Dimension stone, bituminous shale, coal
Chromium, nickel, bauxite, copper, cobalt, titani- Coal, graphite, labradorite, quartz, agate, salt, gypsum,
Madagascar Gemstones, diamonds, PGMs, gold
um, uranium, iron feldspar, mica, marble, zircon, beryl, ilmenite
Malawi Gemstones Copper, nickel, titanium, uranium Coal, kaolin, phosphate, zircon
Mauritius* Basalt, lime
Bauxite, iron, niobium, tantalum, titanium, beryl- Diatomite, salt, quartz, marble, bentonite, rutile, zircon,
Mozambique Gold, coal, gemstones, diamonds
lium ilemenite
Salt, fluorspar, granite, marble, sodalite, wollastonite, man-
Namibia Diamonds, gold, silver, gemstones Copper, lead, zinc, tin, uranium, tantalite
ganese
Seychelles** Clay
Lead, zinc, bauxite, copper, nickel, iron, chromi- Coal, phosphate, kyanite, vermiculite, fluorspar, ilmenite,
Gold, PGMs, platinum, diamonds, gem-
South Africa um, uranium, vanadium, titanium, cobalt, anti- silicon, cement, asbestos, bentonite, feldspar, gypsum,
stones, palladium
mony kaolin, mica, manganese, rutile, zircon
Swaziland Gold, diamonds Coal, kaolin, talc, soapstone
United Republic of
Gold, diamonds, gemstones, silver, PGMs Nickel, bauxite, copper, cobalt, uranium Coal, phosphate, gypsum, pozzolana, soda ash
Tanzania
Copper, zinc, tin, nickel, cobalt, manganese, ura-
Zambia Gemstones, diamonds, gold, silver Coal, sulphur, feldspar, phosphate, barite
nium
Gold, diamonds, PGMs, palladium, plati- Coal, lithium, vermiculite, phosphate, feldspar, graphite,
Zimbabwe Nickel, copper, iron, chromium, cobalt, uranium
num, silver kyanite, perlite, mica, sulphur, talc, asbestos, barite
Source: Minerals and Africa’s Development, 2011.
* http://en.wikipedia.org/wiki/Mineral_industry_of_Mauritius
** http://en.wikipedia.org/wiki/Coral

101
 Annex2: Reflection of the empowerment and inclusion measures in the mining codes of ma-

102
jor mining countries in the SADC region
Local empowerment policy pro- Evidence of moni-
Specific proactive mea-
Country nouncement document in mining Elements of empowerment toring and evalua-
sures
codes tion
• Obligations to train nationals
• Mandatory preference on the use of national materials, ser-
vices and products conditioned to a maximum 10per cent
difference on price and a further 8 days delay on delivery date
Angola when compared to foreign offer
Law no. 31/11, of 23 September
(Rocha & Dias, • Preference for Angolan partners or companies under the Pro- None None
2011
2011) motion of Angolan Private Entrepreneurs Law
• Hiring of Angolan technicians and workers
• Local communities affected to negotiate compensation when-
ever this type of compensation is more favourable than the
legally established financial compensation
• Gives preference to
• materials and products made in Botswana.
• service agencies located in Botswana and owned by Bo-
Mines and Minerals Act, 1999 (no.
Botswana tswana citizens or corporate bodies established under the None None
17 of 1999)
Companies Act.
• citizens of Botswana in employment.
• Conducts training programmes.
• Training courses in artisanal mining
• Priority given to Congolese for any contract relating to a min-
Democratic
Law no. 007/2002 of July 11, 2002 ing project, under conditions equivalent in terms of quantity,
Republic of the None None
Relating to the Mining Code quality, price and delivery and payment dates
Congo
• Priority given to employing Congolese personnel with equal
qualifications.
Mining Law (Law no. 14 / 2002, of
Mozambique None None None
June 26.
• Train citizens of Namibia..
Minerals (Prospecting and Mining) • Procure and use Namibian goods and services.
Namibia None None
Act, 1992 (Act 33 (1) of 1992) • Employ Namibian citizens.
• Cooperate with citizens to develop technology.
 Local empowerment policy pro- Evidence of moni-
Specific proactive mea-
Country nouncement document in mining Elements of empowerment toring and evalua-
sures
codes tion
Empower BEE/HDSA in terms of quantified
• ownership,
• procurement,
Amended broad-based socioeco- • minerals beneficiation, Scorecard, Monitoring,
Reports e.g GRSA
nomic empowerment Charter for • employment, Evaluation and Reporting
South Africa (2009) and PRSA
the South African Mining and Min- • human resource development, on performance against set
(2013)
erals Industry, September 2010 • mining community development, targets.
• housing and living conditions,
• development and growth of mining industry, and
• performance reporting.
Records of the

• the number of persons

• Training citizens of Tanzania employed
United Republic
The Mining Act, 2010 • Procurement and use of Tanzanian goods and services • capacity in which Tan- None
of Tanzania
• Employment of Tanzanian citizens zanians are employed
and
• training of Tanzanian
citizens
• Procurement
Mines and Minerals Development
Zambia • Agency for foreign companies None None
Act 2008 (no 7 of 2008).
• Training
• Training citizens of Zimbabwe
Mines and Minerals Act Chapter • Procurement and use of local goods and services
Zimbabwe None None
21:05 • Employment of Zimbabwean citizens
• Proper housing of labourers
Sources: National mining codes

103
 Annex 3: Policy elements on the exploitation of inclusive natural forestry resources in the SADC region

104
Country Elements of inclusion in forest industry empowerment Other measures Remarks

Local empower-
ment policy pro-
nouncement doc-
ument in mining
codes
Angola
Botswana
Decrees relate exclusively to
Legal protection of traditional users’ right in all forests industrial logging.
The right for local people to manage community forests There is a legal vacuum for
Forest Code Mandatory sustainable management plans for production forests important issues such as com-
Democratic
(Lawrence and Revenue sharing with local governing bodies munity forestry, management of
Republic of the
others, 2006; Social responsibility clauses attached to concession contracts (cahiers de non-timber forest products, rela-
Congo
Counsell, 2006) charges), tionships between communities
Expansion of the protected areas network and logging companies – all of
Promotion of environmental services. which are likely to affect the lives
of millions of Congolese people.

Basic fuelwood and forest produce needs of local communities

“Forest produce” includes trees,
Community involvement in the conservation of trees and forests in forest re-
timber, firewood, branch wood,
serves and protected forest areas
poles, bamboos, chips, sawdust,
Village natural resources management committees can source financial and tech-
plants, grass reeds, peat, thatch,
nical assistance from the private sector, NGOs and other organizations.
bedding, creepers, leaves, moss,
Sustainable utilization of timber, fuelwood and other forest produce
fruits, seed, galls, slabs, roots,
Optimal land use through agroforestry in smallholder farming systems
bark, rubber, gum, resin, sap,
Forestry Act, Control of trafficking in wood and other forestry produce including exportation
Malawi flowers, fungi, honey, wax, earth,
1997 and importation
water, soil, stones, vertebrates,
Bilateral, regional and international co-operation in forest augmentation and con-
invertebrates, wild animals,
servation
hides, horns, bones, ivory, meat
Promotion of proper harvesting systems, transportation
and such other produce as the
Marketing and sustainable utilization of forest produce
Minister may declare to be forest
Forest recreation and tourism in forest areas
produce by notice published in
Control and management of forest reserves and protected forest areas under the
the Gazette.
provisions of the Forestry Act
 Country Elements of inclusion in forest industry empowerment Other measures Remarks

Local empower-
ment policy pro-
nouncement doc-
ument in mining
codes
Sustainable forest management system that will make a significant contribution
to the socioeconomic development of the country
Preference for least destructive practices with best economy and environmental
conservation
Landuse practices with best return on investment in abandoned sugarcane fields
Improvement of land fertility and productivity
Trade-offs between commercial and environmental conservation interests
Stakeholder participation in the development and implementation of the nation-
al forestry policy;
National Forest Gender equity in employment opportunities, training and education, and deci-
Mauritius
Policy, 2006 sion-making
Assessment and integration of all environmental, social and economic aspects
related to forests
Modern, competitive, efficient and well-regulated wood and non-wood process-
ing industry in the private sector
Efficient use of forest resources using efficient technologies, especially for local
value added processing
Use of forests by the people of Mauritius for various purposes
Enhanced awareness of the public to appreciate the role that forests play in their
health and wellbeing

105
106
Country Elements of inclusion in forest industry empowerment Other measures Remarks

Local empower-
ment policy pro-
nouncement doc-
ument in mining
codes
Signatory to the African
Forest Law Enforcement
and Governance (AF-
LEG) in 2003
to combat illegal log-
Action Plan for Poverty - a rural phenomenon to be addressed using resources within the com- ging,
the Reduction mand of rural people to commit itself to the The government has not publi-
of Absolute Social and environmental sustainability, sustainable management of natural re- fair and equitable en- cized its undertaking to AFLEG
Mozambique Poverty 2001- sources, and productivity as key strategic objectives forcement of forest laws and has done little to implement
2005 Forests for rural livelihoods and an engine for rural development to combat illegal log- any of its commitments under
(MacKenzie, Participation of communities, private sector and other producers in forestry, with ging, hunting and trade, AFLEG
2006). “due attention to the long-term sustainable use of the resource” and corruption
to enhance transparen-
cy by forest agencies
to carry out aware-
ness-raising amongst
stakeholders
 Country Elements of inclusion in forest industry empowerment Other measures Remarks

Local empower-
ment policy pro-
nouncement doc-
ument in mining
codes
Empowerment of farmers and local communities to manage forest resources on
a sustainable basis
Increase in the yield of benefits from the national woodlands
Attraction of investment in small and medium-sized industry based on wood and
non-wood forest raw materials
Innovative landuse strategies including multiple use conservation areas, protect-
ed areas, agroforestry and various other approaches designed to yield forestry
global benefits
Institutional capacity-building
Community-based management of natural forests
Community ownership and tenure rights to forest resources
National Forest
Namibia Integration of forestry into existing farming systems to contribute to food security
Policy
and income generation
Promotion of forest products and forest-based industries
Purely productive woodlands as an alternative land use to be left to the private
sector (farmers, local communities, enterprises) in the context of an adequate
institutional policy and incentive framework
Extension service to farmers, local communities and enterprises
Recognition of indigenous technical knowledge be fully recognized to contribute
to sustainable management and rural incomes
Gender equity
Preparation and execution of forest management plans financed by respective
forest owners

107
108
Country Elements of inclusion in forest industry empowerment Other measures Remarks

Local empower-
ment policy pro-
nouncement doc-
ument in mining
codes
• Forests and forest resources to be treated as a national asset
• Policy to be formulated and implemented so as to promote democratization
• People-driven development
• Sustainable forest development
• Competitive and value-adding forest sector
• Decent employment conditions.
• Dynamic, skilled and competent workforce, whose members are satisfied
with their employment conditions, able to grow in their jobs, and motivated
to improve the competitiveness of the sector
• Competitive forestry sector locally and internationally within bounds of ac-
ceptable environmental and social costs
• Equitable access to the opportunities and benefits arising from industrial
White Paper
South Africa forestry such as via equity-sharing arrangements, or facilitating land reform
March 1997
• Speedy resolution of the claims of communities displaced from their land by
afforestation projects or the demarcation of conservation areas
• Afforestation permit allocations and integrated catchment management
directed at equitable, efficient and sustainable allocation of resources, linked
with local economic development and resource-use plans
• Valueaddition to forest products within South Africa
• Incentives and fewer barriers for small farmers and entrepreneurs
• Private sector to help improve a strategy to satisfy the growing demand for
wood and wood products
• Increase in timber yields and improvement in efficiency through research,
technological and managerial innovation, recycling and waste minimization
and the development of alternative fibre sources
 Country Elements of inclusion in forest industry empowerment Other measures Remarks

Local empower-
ment policy pro-
nouncement doc-
ument in mining
codes
• Forests - a national asset, forming part of the scarce land and water resources
• Access to forest resources secured for basic needs and requirements
• Community participation, accountability and transparency in the administra-
Homestead defined as “Estates
tion and management of forest trees
belonging to a single male
• Access to land for the utilization and development of forest resources,
National Forest household and occupied by his
• Secure the tenure of forest and trees
Policy wives and children”. Currently,
Swaziland • Forest productivity
(Swaziland, only males can claim for land
• Sustainable supply of multiple forest products and services
2004) even though the gender issue is
• Income and living conditions, and poverty alleviation
under discussion and should see
• Benefits accrued shared equitably;
some changes in the near future.
• Integration of forestry into urban development
• National capacity to manage and develop the forestry sector in collaboration
with other stakeholders.
• Sustainable supply of forest products and services
• Efficient forest management and conservation
• Participation of all stakeholders in forest management and conservation
• Sustainable management of forests
• Clear ownerships of all forests (including villages, private and government)
• Village forests (for production or conservation) managed by village govern-
National Forest ments or designated entities
Tanzania Policy (1998), • Harmonized extension services and financial incentives for community and
Draft private forest activities
• Employment and foreign exchange earnings
• Promotion of artisanal wood-based products
• Promotion of non-wood based products
• Awareness among stakeholders
• Capacity-building for stakeholders
• Financing mechanism for all stakeholders

109
110
Country Elements of inclusion in forest industry empowerment Other measures Remarks

Local empower-
ment policy pro-
nouncement doc-
ument in mining
codes
• Participation of local communities, traditional leadership, civil society and the
private sector in the management and development of the forestry sector
• Empowerment of traditional leadership to deal with forestry misdemeanors
in customary lands that are under their jurisdiction
• Joint forest management committees in target forest areas for effective coor-
dination, management and mobilization of resources
• Forest resource governance by individuals and local communities in custom-
ary lands
• Incentives and benefit sharing mechanisms for stakeholders in indigenous
forest management
• Participatory system for Environmental Impact Assessment process
• Private sector participation in plantation forestry;
• Forest-based enterprises for value-added products that contribute to nation-
National Forest al development
Zambia Policy (2009), • Long-term development of forest resources through a comprehensive refor-
DRA estation programme
• Secure land tenure
• Incentives for industrial fuel-wood users to invest in tree planting and wood
• land management
• Sufficient and sustainable allocation of land between major competing uses
(e.g. agriculture, energy and mining)
• Local knowledge in the management and utilization of forest resources
• Community forest regeneration funds for community participation in indige-
nous forest management
• Capacity-building and technology for forest-based industries
• Incentives for enterprises directly contributing to forest conservation and
protection
• Promoting and supporting forest-based ecotourism
 Country Elements of inclusion in forest industry empowerment Other measures Remarks

Local empower-
ment policy pro-
nouncement doc-
ument in mining
codes
• Incentives and support for public private partnerships in the establishment
of forest industries
• Small-scale / cottage industries in high value products such as honey, bees-
wax, carbon trading, rattan and timber.
• Establishment of Timber and Honey Auction floor
• Investments in primary forest products placed in the hands of the citizenry to
economically empower them
• Utilization of forest plantation species in charcoal production
• Incentives for small-scale entrepreneurs manufacturing energy-saving cook-
ing braziers and stoves (i.e. consuming limited quantities of charcoal)
• Incentives for the utilization of wood waste to generate energy such as bio-
gassifiers and charcoal briquettes
• A multisectoral approach to the establishment of forest resources for wood
fuel
• Involvement of women in small-scale enterprises dealing in NWFPs.
The Communal
Forest produce defined as “all
Land Forest
• The inhabitants of any communal land shall have the right within that com- vegetation whether dead or
Produce Act;
munal land to exploit for their own use any forest produce alive in a plantation, woodland
Chapter 19:04.
Zimbabwe • Controlof the indiscriminate destruction of flora (plants) and fauna (animals) and forest and any part whether
• Prevention of the degradation, abuse or misuse of land and natural resources alive or dead of any such vegeta-
The Traditional
in their area. tion including wood, bark, seed,
Leaders Act:
fruit, gum, resin or sap”.
Chapter 29:17.
Sources: Various national policies; MacKenzie 2006; (Lawrence and others, 2006; Counsell, 2006)

111
 Annex 4: Policy elements on the exploitation of inclusive wildlife resources in the SADC region

112
Country Elements of inclusion in forest industry empowerment Other measures Remarks

Local empower-
ment policy pro-
nouncement doc-
ument in mining
codes
Environment Was reported the richest
• Protection, conservation and propagation of wild animal life and indigenous vegeta-
Framework Act country in the continent
tion for the benefit and enjoyment of the public
(no. 5/98 of 19 with 275 species of mam-
• Wide public participation of all concerned public and non-public stakeholders at na-
Angola June 1998 mals and 900 species of
tional and local levels;
birds. Now overexploited
• Sustainable use and conservation of forests and wildlife resources
(Jones, 2008) to the point of depletion in
• Right to environmental education and training
some cases.
• Involvement of communities in the management of protected areas
• Socioeconomic needs of neighbouring communities reconciled with the manage-
ment objectives of the adjacent protected areas
• Where feasible, communities allowed to use specified natural resources and perform
certain cultural practices in protected areas
• Community-managed wildlife utilization in wildlife management areas (WMAs);
Wildlife Conser-
• Community photographic areas in WMAs;
vation and Na-
• Community managed wildlife utilization in livestock areas
tional Parks Act of
• Wildlife should contribute to rural development
1992,
• Commercial wildlife industry that is viable on a long-term basis to create economic
opportunities, jobs and incomes for the rural population in particular and the national
Tribal Grazing
economy in general
Botswana Land Policyof
• Existing settlements and livestock grazing accommodated in WMAs by defining their
1975; and
physical extent in agreement with district authorities, which are involved in the man-
agement of WMAs
Tourism Policy of
•
1990.
• Wildlife utilization and management are the primary form of land use in a WMA while
other forms of land are allowed only if compatible with wildlife
(Jones, 2008)
• Wildlife viewing and hunting as part of tourism and, through direct and indirect ben-
efits from tourism, rural communities encouraged to appreciate the value of wildlife
and its conservation
• Consumptive uses of wildlife include safari hunting; citizen and resident hunting;
game harvesting; game farming; intensive breeding of crocodiles and ostriches; live
capture and the sale of game; the processing of wildlife products
 Country Elements of inclusion in forest industry empowerment Other measures Remarks

Local empower-
ment policy pro-
nouncement doc-
ument in mining
codes
Democratic
Republic of the
Congo
Malawi
Mauritius
Mozambique
• Rights to communities over wildlife and tourism
• Economic benefits, locally, regionally and nationally
• Maximum possible benefits to legal residents and neighbours within the limits of eco-
logical and economic sustainability
• Communities longstanding relationships with adjacent protected areas should be
acknowledged and respected.
• Preference for benefits to people who (i) were removed from their land in order to
Parks and Wildlife
establish protected areas, (ii) are recognized as residents by authorities; and (iii) volun-
Management Bill
tarily provided land for the establishment of a protected area in the past;
• Appropriate provision for resident people to carry out their everyday activities, within
Policy on Pro-
the objectives for protected areas;
tected Areas,
• Collaborative management agreements to be negotiated between resident commu-
Neighbours and
Namibia nities and the government;
Resident People
• Adequate compensation for the displacement of people
• Involvement of people legally resident in protected areas in the setting of overall pol-
National Tourism
icies and objectives for these areas, the development of the park management plans
Policy
and the planning of activities which directly affect them
• Where there is overriding interests of conservation, people legally residing in a pro-
(Jones, 2008)
tected area once removed should be provided with alternative access to productive
land and adequate social infrastructure and support to re-establish themselves in
their new locations.
• Co-management of common resources with communities resident in protected areas
• A mature, sustainable and responsible tourism industry contributing significantly to
the economic development of Namibia and the quality of life of all her people – pri-
marily through job creation and economic growth

113
South Africa
114
Country Elements of inclusion in forest industry empowerment Other measures Remarks

Local empower-
ment policy pro-
nouncement doc-
ument in mining
codes
Swaziland
United Repub-
lic of Tanzania
• Game Management Area comprising mostly communal land for the sustainable uti-
lization of wildlife through hunting or tourism, but can be used for other land uses
such as settlement, mining, and agriculture
• Local communities and local government should have fair access to the benefits and
revenue accrued from the sustainable utilization of the wildlife resource
• Fair distribution of the benefits and revenue from GMA resources involving Central
Government, local government and the local communities
• Effective support for the involvement of the local communities to reduce poaching
and other illegal off-takes
• Economic incentives to encourage investment by the private sector with full local
National Policy
community participation
on Environment,
• Redistribution of opportunities to participate in tourism growth, ownership and ac-
2005;
cess for the benefit of Zambians;
Zambia • Diversify the tourism product from being mainly wildlife based;
Tourism Policy of
• Public awareness of the national significance of investment in and the promotion of
1999.
tourism
• Incentives and initiatives in cultural and heritage tourism, traditional ceremonies
(Jones, 2008)
• Community-based tourism;
• Community wildlife management institutions (e.g. Community Resource Boards)
• Local communities and the general public at the international, national, provincial and
district levels to voice concerns about planning and the management of parks
• Communities to participate in management through democratically elected repre-
sentation of the local community themselves
• Local communities residing in chiefdoms and geographic areas which are contiguous
to any wildlife estate or any open area are encouraged and assisted to apply and reg-
ister with ZAWA as Integrated Resources Development Boards.
• A wild animal may be killed in self-defence or in defence of another person.
 Country Elements of inclusion in forest industry empowerment Other measures Remarks

Local empower-
ment policy pro-
nouncement doc-
ument in mining
codes
• Wildlife as an economic resource which can be used sustainably for the benefit of the
nation, private farmers and local communities
• Promotion of a rural-based wild life industry;
• Management of the wildlife estate with the efforts of neighbouring communities that
are developing wildlife as a sustainable form of land use
• Opportunities for public education and the advancement of scientific knowledge
• Public use related to the enjoyment and appreciation of these areas
• Generation of economic activity within the wildlife estate and surrounding areas to
enhance rural development
• Sport hunting as an objective in a protected area
• Quotas set to the maximum sustainable level at which trophy quality can be main-
tained and the hunting can be marketed
Policy for Wildlife • Low density and high quality tourism
of 1992; and • Conservation of wild animals and their habitats outside the parks and wild life estates
if wildlife can be used profitably and the primary benefits accrue to people with wild-
Zimbabwe Parks and Wildlife life on their land
Act of 1975. • Due to scarcity of good arable land, wildlife management permitted in all its diverse
forms as legitimate land use which may be the most appropriate or highest-valued
(Jones, 2008). form of development in many areas
• Wildlife producer communities in district level management
• Distribution of wildlife benefits to producer communities
• Facilities and opportunities may be afforded to the public for camping, hunting, fish-
ing, photography, viewing of animals, bird watching and similar activities
• Right to kill an animal without a permit in self-defence.
• Protection of indigenous property rights of local communities in respect of biological
diversity with scientific knowledge
• Support for the integration of traditional knowledge on the conservation of biological
diversity with scientific knowledge
• Owners of private freehold land deemed to be the appropriate authority over wildlife
on their land

115
116
Country Elements of inclusion in forest industry empowerment Other measures Remarks

Local empower-
ment policy pro-
nouncement doc-
ument in mining
codes
• Communities’ acquisition of rights over wildlife through Rural District Councils;
• Right of the appropriate authority to hunt any animal on the land, remove any animal
or part of an animal from the land and to issue permits to others to hunt or remove
animals from the land
• Distribution of a percentage of income derived from wildlife use to producer commu-
nities to allow these communities to be responsible for a number of wildlife manage-
ment activities
Sources: National policies (Jones, 2008)
 Annex 5: Inclusive growth components in the policies and strategies of SADC Member States

Contribution to Inclusive growth components in fishery

Country Employment Other remarks
GDP (%) policies and strategies

Promotes the development of the small-

Third most important economic sector after oil and the diamond industry-
scale fisheries. The Fisheries Master Plan
Total production in 2009 was 272263 tons, of which artisanal fisheries (42per
2006-2010, the main policy document,
cent) and semi-industrial fishers (42per cent).
Angola 3.5 is aimed at defining key management
measures for the sector to increase and
Aquaculture production focused mainly on inland freshwater both by rural
improve production, taking into account
communities and private sector
the sustainability of aquatic resources.
Fisheries have very little impact on the national economy, but have a relative-
ly high socioeconomic impact, mainly in the Okavango Delta region.

Ensure management, conservation and Fish production has averaged 190 tons over the past six years. The annual na-
Botswana
sustainable utilization of fish resources. tional fish import bill is currently around US$ 2.38 million, equivalent to 2800
tons of fish sourced from outside the country. Main fishing area is the Oka-
vango Delta region with a potential annual fish yield estimated at between
5000 and 8000 tons, representing about 80per cent of the national catch.
Democratic
Marine production is very modest, accounting only for an estimated 2per
Republic of the
cent of total national fish harvests.
Congo
Fish farming boosted by water development projects and three main river
Lesotho Insignificant
subsystems in Lesotho: Senqu (Orange), Makhaleng and Mohokare (Caledon)
Development and management of sus- In 2009, the total supply of fish and fish products for direct consumption was
tainable fisheries by increasing revenue, about 18000 tons, and the total fish traffic in port stood at around 230000
employment and local and foreign in- tons. Artisanal fisheries production accounted for 12per cent of total fisheries
vestment Development of a seafood hub, production in 2008.
Mauritius 1.5 12000
focusing on value added fisheries and Employment of 12000 people including processing and marketing activities,
seafood-related services representing approximately 2per cent of the active population.
Reduction of external food dependence, Fish is also key for food security and is an important source of protein in the
thus contributing to food security local diet. The annual per capita consumption of fish stood at 23 kg in 2009.
The shrimp fishery represents around 4per cent of Madagascar’s reported
landings for the previous decade. However, its market value is significant,
100000 direct reaching almost 70per cent of the officially recorded marine resource contri-
Madagascar 8 (in 2005)*
jobs (in 2005) bution to GDP.
Growing reliance on small-scale artisanal fishing for livelihood and food secu-
rity

117
* www.stopillegalfishing.com/sifnews_article.php?ID=25
118
Contribution to Inclusive growth components in fishery
Country Employment Other remarks
GDP (%) policies and strategies

Directly employing about

60000 fishers, and indirectly about 350000 people who are involved in fish
Sustainable exploitation, management, processing, fish marketing, net making, boat building and engine repair.
conservation of biodiversity and invest- Fisheries also play an important role in ensuring food security for rural pop-
60000 (directly
ment in the fisheries sector through ulation. Capture fisheries is the major subsector, and entails both small-scale
Malawi 4 and 350000 (in-
appropriate biological, technological, (artisanal sector) and large-scale commercial fishing activities.
directly)
sociological and environmental research Average annual fish landing is about 45000 tons.
programmes. Large-scale commercial activities, highly mechanized and capital-intensive
and also developed an aquaculture sector with potential for both small and
large-scale undertakings in a specific pond aquaculture and cage culture
Total fish production in 2009 was 123000 tons (more than 80per cent form
artisanal fisheries) for a total approximate value of US$ 280 million and the
4 (in 2008) 140000 (directly) Food security, increasing foreign exchange total export value was approximately
Mozambique and 500000 (in- earnings, and reducing poverty and un- US$ 47million, mainly from shrimps (77per cent). People employed in the
0.3 (aquaculture) directly). employment. fisheries sector, accounting for approximately 0.8per cent of the active pop-
ulation, mostly in the artisanal sector and the livelihood of 500000 people is
directly dependent on fishing activities.
Consolidation of Namibia’s position as a Namibia’s coastline falls within the Benguela Current system, one of the most
leading fishing nation and contribution to productive habitats in the world. Exclusively industrial with potential for sus-
the achievement of economic, social and tainable yields of up to 1.5 million metric tons per year. Demersal fishery –
conservation goals for the benefit of the one of the most valuable fisheries in Namibia, and almost the entire catch is
13400 direct country. exported (2005:.
(in 2008) US$ 16 million)
Namibia 6.5
and 135000 in- Maintenance of the conservation and
direct responsible management of marine re- The country also has a small inland fisheries sector, mostly diffused northern
sources, support for domestic catching, regions of Caprivi, Okavango and in the Zambezi River basin, of great signif-
processing and marketing, and enhance- icance for livelihood and food security. The aquaculture sector is growing
ment of the participation rate of Namib- and has an important role for alleviating poverty, creating employment and
ians in the sector. enhancing food security.
 Contribution to Inclusive growth components in fishery
Country Employment Other remarks
GDP (%) policies and strategies

Development of the fishing industry to its The country has a claimed Economical Exclusive Zone of 1288643 km2. The
fullest potential and to safeguard the re- Seychelles fisheries sector has three main components: a) artisanal fisheries,
source base for sustainable development targeting mainly demersal and semipelagic species with small, motorised
Regular stakeholder consultations held boats; b) semi-industrial fisheries, consisting of small, locally-owned long-
regarding the development of the sector, liners targeting pelagic species (mainly tuna and swordfish); and c) industrial
primarily aiming to create a proactive dia-fisheries, targeting tuna species, mainly operating with foreign-owned purse
5000 in 2011 logue to improve transparency. seiners and large long-liners. Mariculture is considered as priority and there
(about 11% of are currently two active mariculture projects in Seychelles outside Mahé.
Seychelles 7.7
total formal em- Promotion of the conservation and sus- Fisheries contributed 97per cent of export earnings. The Seychelles tuna fish-
ployment) tainable management of marine resources ery, exploited mainly by EU vessels, brought in a total catch of 261000 tons in
Maximize employment, revenue and for- 2009.The sector employs approximately 17per cent of total formal employ-
eign exchange earnings ment and has a key role for income generation, foreign exchange earnings as
Promotion of safety at sea, and the main- well as for food security.
tenance of Port Victoria as the major tuna
landing and transhipment port in the West Employment in the fisheries sector also includes people employed in fish
Indian Ocean. processing, export activities, net repairs and ship chandelling
Marine Living Resources Act, 1998: “All
our natural living marine resources and
Commercial our marine environment belong to all the
fishing industry people of South Africa.”
employed 43458
(2008). A leading dynamic, united, prosperous and
people-centred sector, achieved through
In 2008, developing and sustaining a sector that 5600 tons of commercial fish caught and 16,000 tons line fish in 2003.
0.05 (commercial 27000 directly contributes and embraces: economic
South Africa
fisheries only, and 100000 indi- growth and development; job creation; Recreational fishery generated ZAR3 billion in 2011.
(WWF, 2011;
2008) rectly. rural development; the sustainable use
DAFF, 2012)
(FAO, 2010b) of natural resources; the maintenance of Commercial fishing industry employs approximately 43458 people, including
biodiversity and ecosystems; sustainable seasonal and permanent employment
Also, about livelihoods; food security.
500000 people
participate in Small-scale fisheries policy (equity in the
recreational value chain; growth and competitiveness
fishery through providing support to small op-
erators to enable them to improve their

119
productivity and incomes)
120
Contribution to Inclusive growth components in fishery
Country Employment Other remarks
GDP (%) policies and strategies
Ensure an optimal and sustainable ex-
ploitation of the country’s fisheries re-
Swaziland Insignificant sources and promote the consumption of
fish at both household and national levels
in order to enhance national food security.
The success and breadth of applying the
co-management (with, for example, dis-
trict authorities, Beach Management Units
United Repub- and industry) approach has been possi-
1.3
lic of Tanzania ble thanks to the support provided by a
range of institutions such as international
development partners, NGOs and church
groups.
Reduction of poverty through improved
fishery governance Sustainable manage-
ment of resources and addressing national
cooperation, decentralization and com-
300000 (directly munity participation in fisheries manage-
Zambia 3.3 (in 2008)
and indirectly) ment
Promotion of the sustainable utilization of
fisheries resources
Zimbabwe
Sources: ACPFish II, 2013; WWF, 2011; DAFF, 2012; FAO, 2010b
The main fishing areas are in the dams constructed principally for hydro-
power and in other smaller dams spread all over the country in the lowlands,
used for water supply for both human and livestock consumption. Aquacul-
ture is still in a formative state: there are currently 80 ponds of an average size
of 200 m2.
The United Republic of Tanzania is a major supplier of inland fish (especially
dagaa) to regional markets supplying consumers from Congo and South
Africa to Sudan in the north.
Most inshore marine fisheries are characterized by small owner-operated
vessels targeting reef fish for local or national consumption.
Inland aquaculture is poorly developed with a focus mainly on tilapia where-
as the coastal mariculture business (especially seaweed) has seen substantial
development in recent years with the United Republic of Tanzania now a
global player. IUU fishing in the EEZ waters continues to be a growing prob-
lem.
Almost all fisheries are dominated by small-scale artisanal fishers using gill
nets and small fishing boats, estimated to be approximately 30000. There
is also an industrial fisheries sector, mainly on Lakes Kariba and Tanganyika
where large fishing vessels exploiting pelagic fish operate.
With an estimated capacity of sustainable yields of up to 150000 metric tons
per year Zambia is producing currently average of 65000/70000 tons.
Over 300000 people employed directly as fishers and fish farmers, or indirect-
ly as traders, processors and other service providers.
Aquaculture sector in Zambia is mainly composed by small-scale fish farm-
ing (80per cent of the total) with some 6460 farmers and 13900 fish ponds,
a global water surface covering 342 ha and an estimated production of 1.6
tons/ha/year (2002).