Renowned Engineer Clive Chirwa says Zambia’s target of increasing copper production to three million tons in the next ten years is unattainable.
The UPND government is eyeing a copper production of up to 1.3 million metric tons for the 2022 fiscal year as the country begins taking steps towards achieving its target of 3 million metric tons of copper within the next 10 years.
In an interview with the Zambian Business Times-ZBT, Chirwa argued that the target is unattainable because of the low copper content in the ores around the country.
“It is not attainable due to the low copper content in the ore around Zambia. If we get to 1.5 million tons of copper productions this year then we can celebrate success”, he said.
And Financial Analyst Maambo Hamaundu said government should first start by asking why the mining companies were not able to accomplish this 3 million tons production levels and then take practical steps towards achieving the pronouncement.
Hamaundu had earlier told the ZBT in an exclusive interview that achieving the set 3 million tons of annual copper production target by the government would put Zambia in a very good strategic position.
“The minister of finance in one of his pronouncements did indicate to say he wants to see an improvement in the mining sector in terms of production. Our production of copper now is around 850 000 tonnes per year, he is pushing to say we could go to 3 million tons per annum”, he said.
“If we accomplish that and with the projections that the copper prices are likely to stay up and might even go higher than where it is now, then Zambia is sitting in a very good position, we might see the benefits of higher copper production trickling down into Zambia”, Hamaundu noted.
“But all this will be centered around management, yes we can pronounce to say we want to go to 3 million tons but we need to ensure that there are practical steps that are being taken,” he said.
Hamaundu further said “we need to ask ourselves, why are we not accomplishing that 3 million tonnes production now? What challenges is the mining sector facing? Are the mines deliberately not just mining because they are perhaps demotivated because of the current tax laws or is it that they do not have sufficient electricity to help them mine”.
He said all those questions have to be asked and answers or solutions identified on what needs to be done to ensure the country meets the target it’s aiming at adding that ultimately if copper production improves, the ultimate and bigger beneficiaries will be the Zambian people.
“Of course the business owners will also benefit but the biggest beneficiaries will be the Zambian people because a number of jobs will be created in the process, we will have high tax revenues to meet the social services and other needs for the country. That is the position we are in as a country at the moment,” he explained.
The challenge has always been on how to strike a balance between the mining companies interests and the country’s interests and agreeing on predictable and long term taxation that is equitable for the key stakeholders. It remains to be seen how the new government will handle these very complex negotiations.
