The Chamber of Mines in Zambia has asked Government through the ministry of mines to be more clear and categorical on earlier announced intentions that the state intends to increase stake or shareholding in mining companies in Zambia to avoid scaring away investors.
Speaking during a panel discussion at the just ended 2021 Mining Indaba, which the Zambian Business Times-ZBT attended, Lubambe Mine representative Nick Bowen said the statement that Zambia wanted to take significant stakes in unspecified mines led to fears of nationalization and slowing down of investments in the sector.
Bowen said if the country is to attract [foreign direct] investments, messages like these needed to be clear and categorical as the international investors follow what is happening and what is being said.
“Government needs to be clear on its intentions on mines, the statement that it wanted to hold more stake in mining companies does not specify what really Government wants to do. Zambia needs to attract more Investments now that copper price projection are favorable so that the country can be poised to continue to benefit from the green revolution”.
“If the government wants to attract investments into the country, it needs to come out clear, we need to be accurate with the information we are putting across,” he said. He said there is need to be mindful of what message is being put across as that changes the perception about Zambia and investments may come in depending on that.
However, Finance Minister of Finance Dr Bwalya Ng’andu had explained that Zambia is not looking to take over more mining companies, nor is the government planning to nationalize the industry.
The Zambian government has recently acquired 100% of Glencore’s Mopani Copper Mines and Vedanta’s Konkola Copper Mines – KCM local operations in the past two years. The take over of KCM was however through ZCCM IH liquidation process, after complaints by local contractors and suppliers of not being paid for extended periods of time.
A check by ZBT however found that the minister of Finance had categorically stated that the statement of increasing mining stake was only related to Mopani and KCM. “We are at this point in time not looking at any other specific mining operations that we want to go into a relationship with,” Dr. Ng’andu had earlier stated.
The Minister said, “In some quarters the president’s statement was misunderstood to mean that Zambia is contemplating taking over other mining firms by force or nationalizing mining companies. We are not in that business at all.”
Dr Ng’undu pointed out that government cannot engage in nationalization of mines because it has learnt lessons from other copper mining countries. “We have to make sure we run these as proper businesses without interference in their operations,” he said.
The Finance Minister further stated that Zambia will also get a better understanding of mining taxation and royalties from running operations like those previously owned by Glencore such as Mopani. Govt will not just be a spectator but also an industry participant through ZCCM IH.
The Chamber of Mines however stated that there is need to be more clear and categorical by specifically stating what and where these intensions to increase stake in Mines end. Mining is a long term business and the need to clearly state if the acquisition of more stake in Mines have ended with KCM and Mopani should be made clear.
