The Policy Monitoring and Research Centre (PMRC) has praised government through the Zambia Consolidated Copper Mines Investments Holdings (ZCCM-IH) for the acquisition of 100 percent shareholding from Mopani Copper mines (MCM).
PMRC Executive Director Bernadette Deka has observed that the 100% acquisition will have a positive impact in the socio-economic well-being of the community.
Mrs Deka cited ensuring job security for 15,000 mine workers as some of the benefits that the community and the nation at large is likely to get from the decision.
She noted that the decision will also have a trickle-down effect on their communities as it will provide an opportunity for local mine suppliers and contractors to conduct business with the mines, which will enhance the establishment of local mining supply chains.
Mrs .Deka noted that government will increase the number of local contractors within the mining industry thereby enhancing the establishment of local mining supply chains.
“The 100% acquisition comes with many socio-economic benefits such as employment security for the 15,000 mine workers. This will have a trickle-down effect on their communities and the nation as large. The acquisition also provides an opportunity for local mine suppliers and contractors to conduct business with the mines. It is envisioned that this move by government will increase the number of local contractors within the mining sector, which will enhance the establishment of local mining supply chains,” She stated.
She further added that the deal comes at a time in which the price of copper has increased on the global market, trading at $ 8,014 per tonne as of the January 20, 2021, with a projection of above $7000 per tonne in 2021.
She further said that government will therefore generate revenue which will not only be used to pay off its acquisition loan but will also be used to enhance economic development in the country.
She has since advised government to amend the Mines and Minerals Development Act No 11 of 2015 if it’s to maximize from this acquisition and ensure that Zambians benefit from the mining sector.
The PMRC Executive Director explained that amending the Act will ensure proper coordination and an adequate legal framework governing the mine as poor corporate governance has led to the fall of many private and state owned enterprises around the world.
Mrs Deka has recommended that principles of corporate governance be embedded in the running of MCM development in the country.
“In order for Government to maximize from this acquisition, there is need for them to amend the Mines and Minerals Development Act No. 11 of 2015 to ensure that Zambians benefit from the mining sector. The amendment of the Act will ensure proper coordination and an adequate legal framework governing the mine. Secondly, poor corporate governance has led to the fall of many private and stated owned enterprises around the world,” She said.
Last month government, through its mining investment arm ZCCM-IH completed the 100% acquisition of Mopani Copper Mines (MCM) following its negotiations with Glencore Corporation.
This follows Glencore Corporation’s intention in April last year to place the mine under care and maintenance sighting the impact of the COVID-19 pandemic and low copper prices. However, this was rebutted by government because it would have resulted in the loss of employment for 15,000 employees.