Dialogue with mining companies on policy Changes to develop sector, EITI urges Zambia

Zambia should act cautiously when implementing policies intended to maximize returns on its mineral wealth and avoid stifling high productivity of the red metal, the Extractive Industries Transparency International says. 

The EITI notes that while Zambia seeks to ‘recoup’ resources that have not been realized over the years, given various demands to bolster its economy, there is need for co-existence among players. 

The EITI is a global coalition of governments, companies and civil society globally, working together to improve openness and accountable management of revenues from natural resources. 

The EITI states that though it’s the Government’s desire is to meet demands for various social responsibilities dialogue is paramount chiefly with mining companies on policy formulation because of their contribution to economic growth, Clare Short, its chairperson and former lawmaker says. 

“They should dialogue…..I know Zambia is still trying to catch up with the low resources realized from the mineral wealth in recent years, but, the mining companies should be consulted,” she said on the sidelines of the 20th Mining Indaba taking place from February 3-6 in Cape Town in South Africa. 

Short commended the Government for pursuing various policies to enhance transparency, good governance and ensuring mining companies avoid under pricing. 

Short has been a member of the Advocacy Panel of Cities Alliance, an alliance of the World Bank, UN-HABITAT, local government and development partners committed to meeting the UN target to develop cities without slums.

She is also a member of the Advisory Committee of International Lawyers for Africa and a Trustee of Africa Humanitarian Action.

Recently, IMF, while recognizing  Zambia’s concerted efforts in trying to generate resources to meet national demands  through various tax formulations, stressed the need for stakeholders, Government, mining companies and all players to dialogue on matters that might affect the sector’s growth, said IMF’s representative in Zambia, Tobias Rasmussen.

While the Bretton Woods institution regrets calls for reinstatement of windfall tax by various players as a best alternative to debt contraction, urged the Government to dialogue with all players on the matter.

It regretted the lapse in policy formulation which warns is a threat to the industry’s growth.

However, despite some shortcomings, mining companies and the private sector in general, have contributed over US$220 million in direct foreign investment to Zambia in corporate social responsibility programmes.

During the fiscal year 2012, mining contributed 51 percent, amounting to US$99 million, according to data from the country’s chamber of mines.

The Chamber of Mines in Zambia, a consortium of foreign mining companies said the sector’s 51 percent overall contribution to CSR were chiefly in the health sector which received the highest contributions.

Overall Health sector had netted US$62 million from the private sector including the mines, representing 33 percent of the total expenditure in the year under review.

Other sectors that benefited in CSR included education, arts, environmental management and security, among others as the private sector sought to uphold the CSR programms to better the livelihood of the people in communities they operate.

Major multinational mining companies have invested in various social programmes ranging from infrastructure, health, sanitation , water and sports development, the report added

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