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Charcoal in Zambia: can sustainability be achieved through inclusive business?

Zambia
Sub-Saharan Africa
22. Jan 2013

In June last year I went to Lusaka, the Zambian capital, for the first time. One of the pieces of work I was to complete was a value chain analysis of the charcoal industry along one of the supply routes into Lusaka.

Having seen the destructive power of the charcoal trade first hand in Malawi I was interested to see how the situation compared in neighbouring Zambia. In Malawi, the charcoal trade is illegal and yet over 13 per cent of total forest cover has been lost in the past decade leaving coverage at just 36 per cent. Zambia still has 60 per cent national forest cover and so I had hopes that Zambia may have already made progress towards a suitable charcoal trade.

That however, was not the case. Unfortunately, although charcoal is legal in Zambia and regulation is in place to control the trade, policies are hopelessly enforced and often corrupted.

So what now can inclusive business do in a context such as this, and does it have a role to play in the natural resource sector? These are the questions that the social enterprise BioCarbon Partners is hoping to answer. BioCarbon Partners, as part of the REDD (Reducing Emissions from Deforestation and Degradation) Programme, are trying to establish an eco-charcoal project in an area surrounding a protected forest reserve. How to do this in a way that can be effective in the long term is the key challenge. My job was to provide an insight into the current charcoal trade. Only if current profit margins can be exceeded, is it likely that any new intervention will be attractive to producers and traders. To find out what I discovered and my recommendations to BioCarbon Parters, take a look at this summary.

The primary conclusion drawn is that small scale eco-charcoal projects are feasible if they undercut the retail price offered by the supermarkets. The current price of charcoal in the Lusaka market is half that of the price in the supermarkets. This however is only a small segment of the true charcoal market and represents briquettes rather than lumpwood charcoal. To transform the majority of the industry, the average consumer will have to pay a higher price in order to ensure all the necessary levies are incorporated into the final cost. If this reform is to happen on a large scale then there will need to be a strategic plan implemented by the Forestry Department.