African Businessmen and Development in Zambia

African Businessmen and Development in Zambia

by Andrew A. Beveridge, Anthony R. Oberschall

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Drawing on their extensive fieldwork in Zambia, the authors address these central concerns: the social origins and motivations of African entrepreneurs, and the determinants of their success; the impact of government policies on business growth; the relative performance of Zambians in business; and the effects of small business on Zambian society.



Drawing on their extensive fieldwork in Zambia, the authors address these central concerns: the social origins and motivations of African entrepreneurs, and the determinants of their success; the impact of government policies on business growth; the relative performance of Zambians in business; and the effects of small business on Zambian society.

Originally published in 1979.

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African Businessmen and Development in Zambia

By Andrew A. Beveridge, Anthony R. Oberschall


Copyright © 1979 Princeton University Press
All rights reserved.
ISBN: 978-0-691-03121-7


From Rhodes to Kaunda

Before the advent of Livingstone and other British explorers in the mid-1800s, the small amount of trade and industry that existed in Zambia was in the hands of the Africans who lived there, except for the slave trade, which was controlled by the Arabs and Swahili. After British colonization, Zambia remained an economic backwater until the growth of copper mining just prior to the Great Depression. Foreign capital and multinational corporations developed one of the largest copper-mining complexes in the world by means of African labor drawn from villages. Indeed, with a GNP of close to $2 billion in 1973, Zambia has had one of the highest per capita incomes in independent black Africa.

Yet copper, the very foundation of Zambia's wealth, was also the source of its political dependence and economic vulnerability. Depending on its wildly fluctuating world market price, copper accounts for 40 to 75 percent of Zambia's GNP. African and non-African economic activity was sparked by the copper boom, but remains constrained by Zambia's role as provider of a single primary commodity in the international economy.

After independence the Zambian government sought to transfer control of the copper industry and other economic resources from foreign corporations and nationals to the new Zambian state and its citizens. In the 1950s less than 5 percent of Zambia's economic activity (excluding the subsistence sector) was in African hands, although even this small share represented large growth in absolute terms since the turn of the century. Six years after independence in 1970, the African share had risen to over 10 percent, or about one-third, if the dominant mining sector is excluded. To understand these changes requires knowledge of Zambia's history. Climate, ecology, resources, social organization, colonialism and decolonization, past and present government policies, all have had a hand in shaping and constraining African trade and business. This first chapter describes the wider contexts of African economic activity with special emphasis on Western influences in the past one hundred years.

Early History and Settlement

Zambia lies landlocked in the middle of Southern Africa and is surrounded by eight other political territories: the independent African states of Tanzania, Malawi, Botswana, and Zaire (formerly the Congo); white-ruled Rhodesia; Namibia (administered by South Africa); and recently independent Mozambique and Angola (Portuguese colonies at the time of the study).

Though in the tropics, Zambia is subject to a modified tropical climate because it lies on a high plateau. The soil is not especially fertile, yet even so its agricultural potential has not been exploited. Animal husbandry was not possible in areas infested with the tsetse fly, which carries sleeping sickness and is still found in large uninhabited parts of the country. The country consists mainly of flat to slightly undulating plateaus. There are several large river systems, and flooding occurs in some areas during the rainy season, notably in the Zambezi and Kafue plains. Zambia's principal resource is the extensive copper deposits which lie in a "copper belt" extending up to Shaba (formerly ,Katanga) in Zaire. Other minerals are also mined, but copper is by far the most important.

Before Cecil Rhodes sent his agents north of the Zambezi to claim the territory on behalf of his British South African Company in the late nineteenth century, the total population was approximately one million. A great variety of peoples existed in the area that is now Zambia, as they still do. It is not certain who occupied the area before 1500, though some evidence indicates that they were Bantu-speaking peoples and some bushmen. During the succeeding 400 years before the British gained control in the area, it was the scene of invasions and migrations by various other groups. These included the Luyi and later the Kololo who mingled with local inhabitants and created the Lozi nation in what is now the Western Province. The Ngoni, a Zulu group, came from the south after their defeat at the hands of Shaka Zulu, and conquered areas in the present Eastern Province. Other Zambian groups, including the Bemba, both Lundas, the Bisa, Lala, Luvale, and Lenje trace their origin to what is now Zaire. Immigrants and conquerors became incorporated with local peoples through intermarriage and assimilation. Because of these historic settlement patterns, a close relationship still exists between the area a Zambian is born in, his ethnic group, and his home language.

The people of Zambia were organized in a variety of ways. Most ethnic groups followed matrilineal rules of descent for their offspring. Except for the Lozi and Kazembe kingdoms, state systems were not highly centralized. Compared to much of West Africa and some parts of East Africa, there was little social stratification during the precolonial period. Most Zambians were engaged in subsistence agriculture. Even the more highly organized political systems were recent creations. Domestic servitude did exist, however, and the slave trade in the middle of the nineteenth century had a debilitating impact on rural societies.

Agriculture was usually of the slash and burn (chitemene) type. Trees and grass were allowed to grow for several years. When fields were cultivated, the vegetation was cut, piled, and set on fire. Seeds were then planted in the ash which served as fertilizer. After the crop was harvested, the land lay fallow for several years. The chitemene system suited the soils which were only marginally fertile without chemical fertilizer. Staple crops included maize, millet, and cassava. Vegetables were raised in gardens to use as a relish with porridge made from the staple crop. Few people went hungry, and few worked particularly hard (Siddle, 1971:58). Accumulation of material possessions and the growth of inequality were restricted by low population density, productivity, and output and the lack of specialization. Trading was limited to small-scale and part-time activities.

Impact of European Domination


The Europeans began arriving in significant numbers after Livingstone's writing had drawn attention to the trans-Zambezi area. Although immediate changes for the local people may not have been dramatic, in the long run, of course, the whole of Zambian history was altered. The earliest arrivals were missionaries and explorers. First in a long line of these, Livingstone had come to spread Christianity, to find the sources of the Nile, and to help stop the slave trade. The evangelists who followed Livingstone both before and after the British military conquest of the territory founded a series of mission stations and schools. Since the area was vast and mission societies had limited resources, each denomination localized its operations, and little intersectarian competition took place. Thus, Africans from the same district (and therefore from the same ethnic group) were taught a particular version of the "truth" and could acquire a certain level of education. Those in other districts learned another version and had a different educational opportunity.

Missionaries were agents of change. They established stations, churches, and productive enterprises well ahead of the colonial administration. More by example than by preaching, they taught Africans some elements and skills of Western culture. They demonstrated the superior efficiency of more advanced technology and encouraged individual achievement. Africans who attended boarding school were intensively exposed to new values. While under the control of missionaries twenty-four hours a day, they were rewarded for heeding the lessons of their teachers — both secular and sacred, formal and informal. At the same time, some students learned what were to become needed skills for advancement in the European-dominated society.

The missionaries committed the African languages to writing. They introduced new skills such as carpentry and metal work, as well as new modes of dress. Many missionary societies operated farms of their own for food and sold goods in their stores for profit. In many localities they were the first businessmen, the first employers of African labor, and pioneers in introducing money into economic transactions (Gardiner, 1971:38). In later chapters, we will assess the influence missionaries had through education, preaching, and concrete help on the careers of contemporary African businessmen.

British South Africa Company

Traders, prospectors, soldiers, and administrators soon followed the early missionaries. It was the employees of the Chartered Company, founded and owned by the British South Africa Company, who had the greatest subsequent impact on the history of Zambia. They came searching for deposits of great wealth, the gold and silver of a hoped-for new Rand. Their prime object north of the Zambezi was to obtain mineral rights and trading concessions. They often accomplished their purposes by misrepresenting themselves to the local chiefs. One of the most blatant examples resulted in the Lozi King Lewanika's concession to Lochner of nearly all rights in a vast territory in Western Zambia. Lochner represented himself as an envoy of Queen Victoria; in fact, Lewanika was dealing with Rhode's Chartered Company, "a very different kettle of fish," as one historian of the period rightly notes (Davidson, 1969:217).

By means of the Lochner and other concessions, the Chartered Company claimed control of the vast territory called Northern Rhodesia. The British government was only too happy to put another area of the map under its sphere of influence without having to spend funds to administer it. In Eastern and Northeastern Zambia, however, British troops had to be called upon to establish de facto control ahead of Belgian, German, and Portuguese penetration. Of the tribes in the area, the Ngoni resisted most determinedly. In 189798, a military force of 1,000 Indian and African soldiers commanded by British officers was sent to face 10,000 Ngoni warriors. In the ensuing battle, the Ngoni military leader was captured and shot. Twelve thousand head of cattle were seized, and many villages were destroyed. In Bembaland, in the North, the chiefs were divided, and little resistance was offered. The Lunda capital at Kazembe was subdued by a small European force after a show of artillery (Pollock, 1971:179-183). A little more than a decade later, in 1913, the entire territory was controlled with the help of a police force consisting of only 750 Africans led by 27 British sergeants and officers (Gann, 1971:102). Pax Britannica had arrived.

Under the skeleton colonial administration the slave trade was stamped out, and government stations (bomas) were established. Ethnic warfare and mass migration also ceased. The Chartered did not make any profit in Northern Rhodesia, however, and in an effort to cut costs, spent little on administration. Company administration was primarily of the "law and order" variety. As late as 1931, seven years after the end of Company rule, the administration consisted of 9 provincial commissioners, 91 district officers, 15 European clerks, 95 African clerks, and 553 native messengers (Davis, 1931:245). Because Northeastern Rhodesia was more accessible from the east than from Southern Rhodesia, it was governed for a time by the British colonial administration from Malawi (then called Nyasaland), for which the colonial office received a £10,000 compensation from the Chartered Company.

The modest economic development brought by Rhodes's British South Africa Company was spearheaded by the railroad. With the dream of a line from Cape to Cairo entirely within British territory, Rhodes convinced the British South Africa Company to bridge the Zambezi at Victoria Falls. By 1906 the rail line reached Broken Hill (now Kabwe), about three hundred fifty miles north of Livingstone. By 1909 it crossed all of what is now Zambia into Katanga. As Kay (1967:31) wrote, "so great was the influence of the railway on the distribution of European settlement and economic development that the 'line of rail' was quickly distinguished from the up-country 'bush' regions." This distinction has persisted to the present day. According to historian Gann (1971:109), however, despite the railroad, before World War I, "Northern Rhodesia remained a sleepy, poverty stricken, backward country which mainly served as a reservoir of African labor for the wealthier South."

The problem of making Africans supply their labor to the colonial economy of Southern Africa was solved by means of poll and hut taxes. In the Northeast, a hut tax of three shillings was replaced in 1914 by a poll tax of five shillings per adult male, and five more for each wife beyond the first one. It was later increased, though the tax on wives was abolished in 1929 (Meebelo, 1971:193). Elsewhere in Zambia the tax varied depending on the level of local wages for African labor, but in general the tax was set at one month's wages for an African laborer. If villagers and chiefs resisted collection, punitive expeditions were mounted. Chiefs might be exiled or imprisoned, and some villagers might be publicly flogged. As late as 1930, the government could and did invoke a law permitting collective punishment, collective fines were imposed on all inhabitants of a village, ethnic group, or community if they failed to prevent a criminal escape or restore stolen property, suppressed evidence in a criminal case, resisted tax collection, or rioted (Davis, 1931:241). Though of modest scale and scope, by the late 1920s the European impact had started the transformation of village life in Zambia toward the European and urban dominated society which emerged with the copper booms. New employment opportunities and the subjugation of village authority to the British eventually affected the life of every African. The labor migration system was the first widespread evidence of these changes, which influenced the source and eventual direction of contemporary African business activity in Zambia (Bates, 1976).

At first, recruiters had to travel to rural districts to ensure an adequate labor supply. Soon Africans accepted the market economy, and labor flowed in large migrations back and forth between village and European mine and farm. The wage differentials between low-paying Northern Rhodesia and such higher paying regions as Southern Rhodesia, Katanga, and South Africa were so great that Africans migrated in large numbers to these distant places both before and after the Copperbelt was developed. The unskilled laborer who was paid three, five, or ten shillings in Northern Rhodesia in the 1900s earned fifteen to thirty shillings in Southern Rhodesia and forty-five shillings in the Transvaal. The DeBeers mine in South Africa paid one pound a week for semiskilled labor (Pollock, 1971:411, 422).

Africans offered their labor at low wages, usually for a limited period only. As Davidson (1969:224) writes, "the Africans were no more members of society than the cattle and the game for whom 'reserves' were also soon marked out." Business and commercial farming were made illegal for the "Kaffirs," despite the fact that few Europeans settled in Northern Rhodesia until the 1930s. In 1921 there were fewer than 4,000 Europeans, some non-British by descent. Some occupied the good farmland north of Livingstone which they had quickly reserved for themselves. Another group farmed in Eastern Province around what is now Chipata. Commerce was firmly controlled by the Europeans. Not finding Northern Rhodesia a paying proposition, the Chartered Company relinquished administrative control in 1924 to the Colonial Office while retaining mining and other commercial rights. Despite this change, the white settlers remained in day-to-day control, since London was far away.

Mining Development

Some mining development had occurred during the period of Company rule, but the bulk of it came later. Licensing arrangements for prospecting were changed to give more favorable terms to the potential prospecting companies, thereby encouraging more prospectors to come to Northern Rhodesia. In 1925 the first of the major copper finds was made. Between 1927 and 1931 development of the Copperbelt proceeded at a brisk pace. The opening of the mines meant a surge of migration — both African and European. By 1930, there were about 30,000 Africans employed in the mines, and the European population had grown to 14,000. Even in the depression year of 1930-31, 80,000 Africans (about one-fifth of the adult male population) were employed in wage labor in Northern Rhodesia, and another 35,000 worked elsewhere in Southern Africa (Barber, 1961: 198, 210). Mining activity declined temporarily in the early 1930s following a 60 percent drop in the price of copper, but resumed in late 1933 and flourished during World War II. Vulnerability to world market fluctuations in copper prices has been a constant problem for the Zambian economy since the copper development of the late 1920s.

The system of labor migration in Zambia and Southern Africa created a shortage of productive labor in rural areas and led directly to their impoverishment. Migration, poor soil fertility, low population density, and chitemene agriculture combined to make life there most precarious. In a study of the Northern Province, where out-migration was greatest, Richards (1939) documents how levels of living deteriorated because men spent their most vigorous and productive years in cash employment. Moreover, both the missionaries and political authorities discouraged the slash and burn agriculture since it exhausted and eroded the soil and since the population movement it fostered made it difficult to demarcate village and other boundaries. Because no suitable substitute was provided, the curbs on the slash and burn system adversely affected the well-being of the rural population.


Excerpted from African Businessmen and Development in Zambia by Andrew A. Beveridge, Anthony R. Oberschall. Copyright © 1979 Princeton University Press. Excerpted by permission of PRINCETON UNIVERSITY PRESS.
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