Zambia’s Copper concentrate export ‘ban’ still in force

Zambia’s ban on exports of copper concentrate to foreign – based smelters remains in force because the country has enough capacity to process the raw material, says mines minister Christopher Yaluma.

Last year, a debate ensued as to whether foreign mining companies operating in Zambia should continue exporting copper concentrates to smelters outside the country at zero rates; a move President Michael Sata said was unthinkable noting that the action was depriving the country of the much needed revenue to propel the economic growth.

Mines energy and water development minister Christopher Yaluma said in Lusaka that the Government was monitoring the operations of all mining companies to ensure that the ban remains in force because the country presently, has enough smelting facilities to process the concentrates locally as espoused by the concerned companies.

Mphande---Mineral  economist
Mphande—Mineral economist

Earlier finance minister Alexander Chikwanda had argued that the country was likely to lose revenue from exports of the concentrates from companies including Kansanshi Copper Mines, a unit of First Quantum Minerals as authorized under Statutory Instrument 89.

He argued when he appeared before the expanded parliamentary committee on estimates that the Ministry of Finance had realigned Statutory Instrument 89 in line with President Sata’s directive that it be revoked although the move would result in revenue losses.

“It’s a complex issue on concentrates because Kansanshi Mine is building a smelter to process, but, it will take a year or more to complete and so there will be no income as concentrates will not be processed locally.”

Chamber of Mines of Zambia had also amplified Chikwanda’s argument saying Zambia had no capacity to process concentrates as they needed to be commingled to be processed in the three existing smelters in the country.
However, some critics close to the industry had argued against Chikwanda stating that Statutory Instrument 89 which allowed mining firms to export concentrates tax-free squarely rests on Chikwanda and was not beneficial to the country, argued mineral expert and dean of the school of mines at the University of Zambia, Dr. Mathias Mpande.

Mpande, said senior ZRA officials were sacrificed over the responsibility that should have been solely absorbed by Chikwanda.

In revoking SI 89, which Chikwanda signed on October 4, 2013, President Sata admonished Zambia Revenue Authority commissioner general Berlin Msiska and commissioner of customs Dingani Banda for allegedly advising the finance minister wrongly.

President Michael Sata however had directed that SI 89, which suspended 10 per cent export duty on copper ores and concentrates for one year, be reversed with immediate effect.

The action meant that the SI 89 had reversed the November 2011 decision of the PF government to impose a 10 per cent export duty on copper ores and concentrates.

Mphande---Mineral  economist
Mphande—Mineral economist

However, Yaluma in reiterating the Government’s position on the matter contends that the ban on export of Copper Concentrates is still in force, and government is closely monitoring mining companies to ensure that no copper concentrate is exported.

He argues that smelters at Mopani, Nchanga and Chambeshi Mine can still process all the copper concentrates produced locally.

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