What Zamba's Draft MSME Bill, 2026 means for Formalisation and Inclusion in the Africa free continental trade area

The Ministry has closed the consultation phase on the draft MSME Bill, 2026. Stakeholder input focused on the structural barriers that hold back women-, youth- and disability-led businesses: finance, market access, technology and business support. The Ministry says the proposed framework should help more MSMEs use AfCFTA opportunities as Zambia pursues more inclusive enterprise growth.

Completion of consultations does not mean the bill is ready for Parliament. Zambian bills ordinarily need Cabinet approval and drafting clearance before tabling, and the consultation feedback may change the text. What the announcement does confirm is the policy direction: the government wants a dedicated statute for MSMEs, with inclusion and formalisation as its stated aims.

Zambia has no single code for small business. The relevant rules are spread across several statutes and institutions.

Business registration is handled by the Patents and Companies Registration Agency (PACRA) under the Patents and Companies Registration Agency Act, 2020 and the Companies Act, 2017. Licensing of trade and business activity falls under the Business Regulatory Act, 2014 and the Zambia Development Agency Act, 2006, which also provides the investment and enterprise promotion framework and houses the agency's small enterprise function. Tax obligations for small firms, including turnover tax, sit under the Income Tax Act and related revenue legislation administered by the Zambia Revenue Authority.

Empowerment and inclusion are addressed through the Citizens Economic Empowerment Act, 2006, which established the Citizens Economic Empowerment Commission and funds for targeted groups. Public procurement is governed by the Public Procurement Act, 2020, which contains preference mechanisms for local and targeted suppliers. The rights of persons with disabilities are set out in the Persons with Disabilities Act, 2012.

Access to finance depends on the Movable Property (Security Interest) Act, 2016, which allows movable assets to be used as collateral, and on the Credit Reporting Act, 2018, which regulates credit reference bureaux. Financial sector regulation by the Bank of Zambia, and by the Securities and Exchange Commission and Pensions and Insurance Authority for other segments, shapes how lenders and funds can serve small enterprises.

Policy direction has come from the national MSME policy, which the new Ministry was established to implement. The creation of a dedicated ministry signalled that the government wanted institutional ownership of the sector, and a bill is the natural next step.

At the regional level, Zambia is a party to the Agreement Establishing the African Continental Free Trade Area and participates in COMESA and SADC trade arrangements. AfCFTA brings rules of origin, standards, customs facilitation and, over time, protocols on digital trade, competition and investment. Small firms usually struggle with the documentation, certification and logistics costs that these regimes involve.

The consultation themes match the problems commonly reported by small firms across the region: collateral constraints, limited market linkages, thin technology adoption and fragmented support services.

Business and Operational Analysis

For MSMEs, the principal commercial effect would be eligibility for support, finance and public contracts once registered. Firms that remain informal may find themselves outside the benefits and, depending on the text, exposed to penalties. The cost of formalisation, including fees, tax filing and record keeping, must be set against the benefits, or uptake will be low.

Zambia is moving toward a dedicated statute for MSMEs after completing consultations on the draft bill. The stated aims are formalisation, growth, competitiveness and inclusion of women-, youth- and disability-led businesses, with an eye on AfCFTA markets.