Zambia is pulling all strings for the country to be Africa’s leading copper producer. Chris Yaluma, Mines and Minerals Minister said the country will soon regain the top spot and overthrow Democratic Republic of Congo.
“We’re close, very close,” said Yaluma citing that policy reengineering is propelling the country’s copper industry.
“I don’t see any reason why we can’t. It’s all about stable policies, and finding new ways to encourage Zambian mines to perform even better.”
Yaluma emphatically believes with a production forecast of at least 800 000 tonnes this year, the country will reach its target. DRC overtook Zambia to become Africa’s largest producer of copper, with an output of 942 000 tonnes in 2013. However, DRC suffered its first decline in production in 2015 after several years of steady growth, but production was back up to just over 1 million tonnes in 2016.
Yaluma is also optimistic that Zambia’s political stability will help grow the copper industry, as opposed ethnic or tribal violence witnessed in other African countries.
“In Zambia, we kick governments out through a ballot, and not the barrel of a gun,” Yaluma said.
Yaluma highlighted Zambia’s other key strengths as an investment destination are the abundant and varied mineral resources that include base metals, precious metals, gemstones and energy metals such as uranium; a competitive mining tax regime and stable policies and an open economy with no restrictions on expatriation of profits.
Yaluma admitted that it hadn’t always been easy for the mining industry in recent years, and that it had taken government a while to face up to various challenges and correct them.
“Even up to three years ago, we were still grappling with inconsistent policies, changing tax regimes and moving the goalposts. The 20% Mineral Royalty Tax regime really frustrated investors. That’s when we realised that we must start talking and dialoguing with the Chamber of Mines. We never really consulted them adequately. It’s like we were doing our own thing.”
The new spirit of dialogue has led to a better, more accommodating sliding-scale MRT regime based on the prevailing copper price.
Yaluma is cognisant of the fact that the overall tax burden on Zambia’s mines is still high by international standards, and has not ruled out further reductions when circumstances permit it.
“Tax rates are highly competitive, and you have to do the right thing to keep yourself afloat in this business,” he said.