Some mining companies in Zambia have suspended works on their expansion projects, because of alleged reduction in profits due to the newly introduced taxes in this year’s budget.
First Quantum Mining Country Manager, Chisanga Puta, cited his companies Mopani Copper mine and Kashime mine in Mkushi as some of the mines that have suspended projects.
He said over 4,500 job opportunities would have been created if these various projects were to be undertaken.
“About 600 jobs could have been created at Bwana Mkubwa mine, 2000 at Mopani on the construction of the shaft and 2000 more at Kashime whose investment ranges between US$150 million and $US200million,’ he said.
He said it has been difficult for his company to raise money for the construction of the roaster due to uncertainties in the mining sector following the introduction of the new taxes.
He stressed the taxes in the sector, including the new ones, which stand at 61 per cent, have left little money for reinvestment by companies.
Government this year introduced new tax regime in the mining sector that include a windfall tax of 25 per cent at the price of $US 2.50 per pound but below US$ 3.00 per pound.
It further increased the mineral loyalty tax from 0.6 per cent on the base metals to 6 per cent effective April 1, 2008.
However, due to the conducive environment for investment in the sector which has been caused by the raising of copper prices on the international market, Zambia has so far recorded about $US3billion investment.
He reiterated that the move by government to abolish the Development Agreement (DA) that was legally binding was a breach of the law.
Mr. Puta said the newly introduced taxes have dented the credibility of the country to the outside world.
He was speaking during a panel discussion on mining, which was held on alongside with the Euromoney Conference that closed in Lusaka today.
He said the mining companies were, from the onset, ready to negotiate with government on the new taxes.
Mr. Puta, however, stated that mining companies were still optimistic that an acceptable mining regime would be agreed upon with government in future.
Chamber of Mines Head, Fredrick Bantubonse, ruled out the possibility of mining companies to pull out following the new taxes.
He however said the reinvestments in the sector by companies would be difficult if no sufficient funds were left after paying the taxes.
Mr. Bantubonse said investors should be seen as partners in the development of the country.
But Managing Partner for Corpus Legal Practitioners, Elias Chipimo, stated that negotiations would have been ongoing if government did not take up the initiative to amend the mines and miners act.
At the same panel, Zambezi Resources Executive Chairman, Willie Sweta, said government and stakeholders should come up with a tax regime that would take into consideration both the needs of the investors and government.
Zambia Consolidated Copper Mines Investment Holdings (ZCCM IH) Chief Executive Officer, Joseph Chikolwa, advised mining companies that had problems with the new taxes to seek audience with government.
He said government was prompted to introduce new measures because of the failure by mining companies to declare dividends.
ZANIS/MK/KSH/ENDS.
Yaba!
It is OK, they can go to hell! What is the benefit of expanded projects and cash earned when the country gets peanuts? In fact, it was also OK for the copper mines to perform very poorly and even when copper prices were down during Kafupis tenure of corruption because the country would have even lost more! what would have been the benefit of exporting more when the prices were at their lowest in history. As long as the country does not benefit from expansion of mining project due to tax system that may only benefit mine owners and share holders in Canada, then let the govt take charge of expanding and new explorations! Its time for Zambia to benefit! Ndimwe bazeleza chomene a Puta!
I would like to be enlightened whether taxes on our minerals are higher than some mineral rich countries like chile?
….Go GRZ! Its high time something solid come out of these minerals. Just don’t pocket the money as well please instead make high way roads, modern airports, etc.
Go where the taxes are low gentlemen or is it suckers
#3, your question is appropriate. These are the facts we need to know before we can unleash our comments. I have also noticed that the government quick to hike taxes whenever investment companies start doing well. Put yourself in their shoes, this is discouraging. $US3billion is a lot of money for a developing nation to gain from just one of it’s plenty investment sectors.
Stupid *****s!!what are you still doing in Zed if you think you van’t pay that high tax???pack and go your own ways…we don’t need thieves here!!VIVA Magande and LPM!!don’t back down and listen to these buggers…
Puta and Bantubonse are pure comprador the lowest of the low petit bourgoise. There is nothing extraordinary about Zambia’s new taxes. For all those who want to know. Mineral royalties in USA, Chile, Australia and Canada range from 3% to 3.5%. Corporate taxes range from 30 to 40%. Zambia has equally raised its corporate tax from 25 to 30% and Mineral royalties from 0.6 (which was the lowest in the world) to 3%. In short there is nothing weird or extraordinary about Zambia’s tax regime. The taxes have just been adjusted upwards to the global average. Be careful of the new breed of Zambians i.e those that are given high sounding posts without executive responsibility.
Ba Chisanga Puta Chekwe was literally away enjoying as CEO in Canada most of his adult life and has no idea how Zambia has been robbed by the so called mining investors including his First Quantum minerals. He sounds like a scratched record with his rhetoric from the “masters” voice. Its such individuals Government must closely watch as they have misplaced loyalties. His family is probably enjoying all the wealth in canada at the expense of our mineral wealth in Zambia. Its a shame for a Zambian to be so unpatriotic.
lost opportunities! lost job figures and a higher tax burden for the the common worker. Lost Government tax revenue and a greater burden. Do we as a nation have the capacity to carry over the work. Do we have sufficient money to do this?
Baka bolala!! leave our country if dont want to pay those taxes. Puta is nothing but a cheap traitor!
#3 and 6, we haev some of the lowest taxes in the world. We can call their bluff and dare them to leave. What is wrong with multi nationals, where ever they go they want to arm twist. Even if we had high taxes, there are other things like like externalisation of profit which can never happen in RSA and Zimbabwe including Botswana. So if they think Zambia is hostile they can try somewhere else, now that we can discuss at equal footing they are uncomfortable, when we were desperate they ensured that we sold the companies for next to nothing because then they called the shots. But guess what fortunes have changed and now Government is calling the shots, at this stage it will be foolish for…
… any sensible business person who can abandon a project because of reduced profit, I thought they were making losses, but reduction in profits, these guys are joking. (bayende kansi)
And these same chaps are not even doing any CSR projects like what ZCCM did for the copperbelt, ba kaboke atase!
#9 imagine ayi, no tusungu twabo, he is even picked up an accent, yaba what is wrong with us kanshi, selling your country for 30 pieces of silver ala.
They can go, tafibola.
KCM has no problem with these taxes, its expansion and social programmes are on going and much more than that of Puta and his First Quantum grp.If you can’t pay these “high” taxes pls leave and use your money elsewhere.
These tax rates are very competitive. Infact we are still asking for lower rates than other countries. We lack the skill to put this arguement to the investors thats the reason they are playing around. Australia had to ask china to pay them the difference because they and chile supply iron ore at the same price yet chile is miles away and they were wondering why their china buys at the price they buy from Assuie. Lets get pipo who are crafty/skilled in these areas and plead our case to these multinationals. They mention all those employment figures, what are the quality of pay for their current employees? Gimme a break!
These taxes maybe good interms of bringing in the much needed revenue but we need to take note of some facts here. Zambians must have a say in how these monies will be used by our government as you can see our road nets works especially on the copperbelt have gone from bad to the unimaginable. Secondly with these new taxes lets bear in mind the spill over effect that will be created. If companies stop expanding the common Zambian man will suffer as contractors are having there contracts terminated and this is spilling more people on the street. Therefore PAYE will go down as the contractors remain jobless and the level of poverty will aslo go up.
Their profit margins take into cognisance the Kwacha/dollar rate. Your exports in Kwacha terms may look great but sell the in dollar terms and you discover that your profits are atually losses! So the question is do you continue putting your money away of course not you leave. The next investor will find out the same. The result, no investment and a bad image. Be careful of IMF! Kaunda knows better!
I would be pleased if the mining companies left given that they are poor employers and are polluting our environment without any hesitation, and most of all, our minerals will be left untouched for future generations to manage.
I am willing to start a fund for settling our citizens away from the mining industry once the suckers leave.
#29:
Why worry about having a bad image as if it is your fault for asking decent taxes from the mining companies so that you do not have to get loans in order to do what is right for your nation? Do not become wimps when you need to develop your country. We are not declaring war on anyone, but asking for decency in exchange for our minerals.
This is a hard topic to comment on.
If you look at Zambia’s current exchange rate, you’ll find that the kwacha is getting stronger. I once read that they estimate it’ll get as strong as K2,500/dollar. Also with the burden of load shedding, high interest rates, high taxes and poor infrastructure, it does spell disaster.
Now the price of copper has shot up. But what is supposed to be large profits is being reduced by the strength of the Kwacha (farmers are having the same problem). They’ll get large figures in dollars but the average worker wants to get paid in Kwacha. After they convert in Kwacha, they’ll find there profits are not exactly what they thought they where as the dollar weakens
cont…
My take on it. Mining makes up a large percentage of our GDP.
Go to the negotiating table and come up with a compromise. Though you may boast rising copper prices. You have to remember that copper is sold in US dollars and the Kwacha is getting stronger while the dollar is getting weaker.
Also tackle the problem of interest rates (i wish they never sold ZANACO) and power. On infrastructure, i have no solution on that because the money from the taxes from the mining companies was supposed to go into infrastructure development (i hope). Also, diversity in the economy is extremely important. The fact that this has affected us so much is that copper mining makes up a large part
cont…
of our GDP which is bad. If copper made up a small part of our GDP and had a small role in our economy, this wouldn’t be a problem.
Right now, we can only wait to see the move govt will make.
(how come only one company is complaining????)
Any investor main aim is to make profits. If no profits are made why continue, he basically winds up. Exploitation by investors must be curtailled by good industrial and environmenta laws and bureau of standards. The trade unions must be well informed. That is the only way to decently abet abuse on the part of the investors. The investor must be assured of his investments as well. simple. The investor wont tell you how to keep him in check. He is there to make money.
Now I am a little sober and I think I can comment without being emotional because of the crazy_zambian above. Do me (us) a favour 23 and 24 change your name to something more protractive of who you are like progressive zambian because I really think you are very progressive. You have looked at both sides of the coin. I want to comment a little about the negotiation, I think negotiations have been done. What the mining companies possibly are looking at is that their profits have reduced from 90% to 70%. Because they have not stated by how much their profits have reduced, I find it a little dodgy. The kwacha that has appreciated works to the advantage of SMEs, I mean what would we rather have?
Mining taxes are too high, pliz GRZ sit down with these infestors and agree on the appropriate taxes which will benefit both parties. We still need them(infestors).
They could have left if the new tax regime is so discouraging.We are already being wimps guys, buckle to people to get our copper export and externalise the monies.What are we getting of all this? Nothing, these provide sub-standard employment anyway, so why not get the most out of them now.Our new tax regime is NOW in line with the rest of the world.Let them go to chile.They know they cannot coz they will pay more in chile, why, coz we have been so desperate, and dancing to tune of these guys.C’mon lets support the govt on this one, these guys do not care about your country, not your copper.Other invester will fill the vacuum these guys are creating by stalling new projects.
… a kwacha trading at 5000 to a dollar just for the benefit of one sector of the economy. These same minors would then go out there and then get services such as transport from outside South Africa more specifically at the expense of the small scale transporters who now can afford decent albeit second hand, trucks that are providing a cheap transport service to these miners. Look someone is bound to complain about taxes, when zambia introduced VAT everybody complained, when Zambia introduced subsidies for fertiliser everybody complained including IMF #20. So who is supposed to be the winner here? My personal view. Everybody! This should be a win-win situation.
#20 my brother/sister, IMF and IBRD (the sexy term for loan shark in this case World Bank) are the same institutions that put us here, quite honestly i think we do not owe them an explanation, how come they do not say something about the recession in the US and Ben Benanke is busy bailing out banks yet they say Government should have no business in business, those are old havard theories and they belong to the museum, do not be cheated when engaging with IBRD and IMF always read between the lines!!!
Miyoba mwana wa kwesu, you are point on if it was really bad, these guys would have left, they are just scared for their jobs because they promised their benefactors heaven on earth, its that simple!
Common on guys lets put our money where our words are. When these mines were bought they were completely run down and to be in there current stake they have cost alot of man and there expansion is another issue. As much as we are supporting govt lets agree on what should have been the best way. The problem i see is that we are too dependant on one sector (mining). Do you know that the govt could have raised far much more had they simply widened the tax base? Do you know how much money in terms of tax is lost at Kamwala & Chisokone everyday? 100’s of millions and yet the marketeers from Congo, en Tanzania and other places get away with it. I think we also need to change the employment
cont… criterion at the ministry of finance. We can not leave such discissions to economists alone we need more accountants and other proffessionals to take part then we can come up with better decisions that will be accepted by all
A forum for discussion should somehow be availed. As is the case, we are completey dependant on a few individual policy makers to decide the course of our nation without without a clearly defined mandate. In other words do our stake holders face the consequences if wrong decisions are made or they simply say ooops and nothing is done. No no one cries out for the job losses.
Viva goverment let them go and hang. These people are stupid, can they tell us how much they pay in other countries where they have operations?
Namibia has a 5% royalty and a mining rate tax of 37.5%, so almost 50% of the money stays here.
#36 But the Namibian dollar is not over rated. They have well defined regulations to curtail abuse. The profits made are firm.
Lol this is funny stuff!!! I read a lil study that stated that all the money they have to pay under the new tax regime they’ll get back just through returns on the VAT they pay! It’s the hight of greed and its time we Zambians finally stood up for ourselves.
Sell out Puta. Do not hold Zambia at gun point. These guys make millions and are trying to twist the govt’s arm to give in, GRZ don’t.
This is bull crap and is what retards growth. Companies cannot be allowed honeymoons while the owners of the land (zambian people) suffer. More taxing on mines has been long overdue, just look at what the anglo-american company did to us, we where exploited in front of our very own eyes. These guys need to know that we’re not doing to take their rubbish anymore, why even complain with the current metal prices? You best believe if they leave, someone else will be willing to take over their mines and they definately know it otherwise they would already have left. No country can have royalties at 0.6%, its simply ‘EXPLOTATION’. Very shameful character this Puta.
Someone help me. I am wondering who’s the owner of the mines. What I know is that FTJ and his gang of thieves sold everything i.e. the minerals and land in which they lie. I don’t about Lumwana the newly opened. Having said that, I don’t know how the govt comes in. Help please SOS.
#33 johnbull…they were given enough time to make money to reconstruct those mines, Its now time for them to either operate normally or leave. Period
They can go to Zaire or Zimbabwe….these chaps are thankless kawalalas
These guys have made enough money? our own people do not even benefit from the copper. they simply want government to bow to their pressure? LPM maintain your stance….non negotiable.
these sharkes when they make easy money than ZAMBIA is sweet for them but when it comes to pay their dues they cry and do all kind of things and say all kind of things . So where is all the money they made till now it is like when they make money it is like going to a weding but when the goverment want its due it is like going to a grave yard but this is y zambia has taken lon to stand on it feet now that there is law and order they r feeling a pinch. fools should just close soon copper will be better than gold the price on LMA will doubel by next 6to 8 months just wait and see . I also would like to warn BOZ not to allow african bank like the one from NIGEIRA they will sell our country
Let us take over the mines then and show them what we can do.
Let us take over the mines then and show them what we can do. We will employ more people than them and give bonuses at every monthend so that our people are happy. Let us just chase them away so that vonse visa nkhala vatu. Sounds like Nationalisation/ Zambianisation to me?
first quantum minerals is not a good friend
for the last 3 years, the benefit from kansanshi for zccm-ih is 260MUS$, but first quantum minerals doesn’t want give dividend to zccm-ih !
is the same with the other zccm-ih’s asset, like mopani, vedanta !
these mining groups have a bad behaviour, it must pay
#37 and who tells you the kwacha is overated? The rate is determined in part by BOZ, so what is in it for Government to over rate the kwacha. I do not believe that the Kwacha is over rated.
Let them PACK AND GO. LET THEM TELL US WHERE THEY CAN ENJOY SUCH FAVOURABLE RATES IN THE WORLD TODAY, LEVY YOU KNOW HOW TO DRIVE THIS VEHICLE CALLED ZAMBIA. GO AHEAD, DRIVE US. SATA HAS SEEN YOUR PSV LICENSE, YOU RAE WELL QUALIFIED. LET THEM GO. OUR MINERALS WONT GO IF THEY PACK. ENOUGH IS ENOUGH.
GO TO CHILE, OR BRAZIL AND SEE IF THESE FOOLS WILL COMPLAIN. CHANGE YOUR BUSINESS TYPE IF YOU WANT TO STAY IN ZAMBIA.
TAKE IT OR LEAVE IT, SIMPLE.
#50 tone down webo, I can see you are really angry with these ba kaboke! Okey please do not die just now we still need you, uzafa na blood pressure ka.
Zambians are so shallow. Why always be emotional. You think the restofthe world is cueing to go to Zambia. If that is so why are yuou still a least developed country.
Zambians working abroad are full of contaditions and do not understand why the copuntrieswwhere they live developed. It is always critizing investors without a modicum ofundersating of the role of capital in development.ambian discussions exibit
Well spotted Michael #48, these mine owners were playing the silly game of keeping all the profits for themselves when Millions of $$$ should have been paid to ZCCM in dividends. Now they cry foul becaus the GRZ wants its slice of the cake. When they pay up the dividends then the GRZ may listen to them. Well done Chikolwa for blowing the whistle !
I am an investor. I bought a few ZCCM’s share. Zambian Government, as majority shareholder in ZCCM, is right when he asks mining group to pay dividends. First Quantum, for example, is keeping more than 200 million US$ (minority interest). They use this huge amount of money for their own profit. Zambian Government, Zambian people, and ZCCM’s minority shareholder would like to benefit of that money.
Let’s say : FRIST QUANTUM GIVE ME MY MONEY !!!!
# 49 Yours is a valid question. You are in Namibia right? how much is a litre of petrol there? Try converting that figure in Kwacha and tell me if you will still manage to get a litre of petrol. By the way Windhoek is so far away, hope you wont be stranded when to come to Zambia next time. Cheers man/woman
I am in Zambia. I we mixing apples and oranges here #55, should the price of petrol be compared on the basis of exchange rates, i do not get it? Please elaborate a little more. (MAN)
Sori Are we [not (I we)] mixing apples and oranges [apologies 55?]
Cheese #52; we agree we are shallow, the reason why now that we are deep we fully understand what you foolish mining companies are trying to do to us (SHAFT us). And talking of being shallow, is that all you can contribute? It has no depth surely because I tried to check what CONTADITIONS means, on me e-disctionary and I could not find it, please tell us what it means! PEACE
Look S.A is our biggest regional trading Partner as you may know. The stronger the kwacha is the greater their gains from their exports to Zambia (Zambias imports). Simple example I gave about fuel should have been more than clear. The reverse is true our exports to them are more expensive. Another example is in cement costs where k25000.00 can buy you a bag of cement when you convert it Rands but for him to by cement frm here he will have to spent over R150. Why should he do that when locally he just spends R45.
#59 Cont’d The kwacha/dollar/rand rate if you like determines how much you will trade. If your kwacha is too strong how many investors given a choice between S.A and Zambia would choose Zambia when the know they will not be able get value from their dollar. Just check out this try converting your bread price in Dollar and compare with regional countries, including Zimbabwe. The Zambian bread is by far more expensive! The same goes with farm produce, copperand so on.
why first quantum doesn’t want to pay dividend to zccm-ih ???
WHY ???
GRZ have to take the majority in the mining and the problem will resolv !!
#60 Cont’d whether we like or not a strong kwacha has made Zambia very expensive. Just Imagine all our hard working farmers getting very little from there produce each passing month as the Kwacha strengthens. The result is caution. Dont produce much to lessen the risk of loss. Ask any farmer, they will tell you.
Okey, I did not have the privy of the fuel price in Namibia, that is where I lost the trend of thought, excuse my ignorance. However, yes I agree totally with you, let me even further your comparizons actually, for a 1000 rand shopping at Mr Price in Lusaka, I can get 2 and half times the amount of shopping if I was to spend that money in South Africa. This is granted, but let us look at the dynamics, firstly Zambia is a landlocked country, even a simple thing like a car on average has to pass through at least a country before getting here, could this explain why the prices are a little on the higher side. secondly, isn’t it these same things concerning taxes that have made the other…
# 52 Cheese, what’s your point?
Every country whether developed or not has had a unique past through which change in livelihood has occurred, to the point that others are clasified as developed, while others are classed otherwise. Replication of one country’s model into another has never yielded the same results. So please tell us something original…not the theories from IMF.
#52 You may think Zambians r shallow in demanding what they do..but to be honest even if we had some fools working in the ministry of finance…if i, as a layman with no experience in such matters know that i would compare first with the average rates in other countries before implementing tax changes. Then surely u don’t think that the figures were brought up overnight!In fact WE UNDERSTAND THAT THESE COUNTRIES ARE BEING DEVEOLOPED AT OUR EXPENSE!! so their profits REDUCE… but they r not making losses otherwise they should give specific figures to back it up?? Have they even done their accounts or they r just making assumptions here. ITS EXPLOITATION AND BULLYING….
#62 just imagine with K2500. converted in Rands you can buy a loaf of bread across the border which you cant on this side of the border. But the fellow across with R5 he can buy bread in Namibia/Zimbabwe or Bostwana but can not manage here because he will only get about K1500.00. See the point.
… countries more competitive, because I imagine Zimbabwe with a very strong law on foreign investment and with a strong manufacturing base, what stops them from getting taxes frome there and then invest them in agriculture subsidies which will then make the producion of wheat cheaper thereby making bread also cheap (I am thinking now). Does it therefore make sense for Zambia to introduce windfall taxes? About the farming community, their fertiliser is usually imported, most of the pestcides are imported, tell me isn’t this an advantage on their side if they looked at the equation from both sides. What i think usually is that we have a tendency as a country to look at profit within each…
..cont..they r trying to threaten the govt by saying now we cant continue with projects which would create 4500 jobs.With what kind of salaries while the BIG guys wallow in their millions of dollars Each will they become poor if they move from millions to hundreds of thousands?
### corrections not millions to hundreds of thousands but my point is if they earn just a little less profit its still profit..ie an increase in what they put in and believe me the number isn’t that small
#67 cont…
item that we sell which is fine. But what if we change the strategy and look at sales turnover and volume of sales. Because quite honestly this is one of the few countries that has a climate where you can grow crops through out the year. I am just throwing ideas out there as to their practicability, I am not very sure guys.
#66 bear in mind that those countries are net exporters while zambia is a net importer…of course food prices will be steeper in zambia than in those counties because we import more than we export
They have been smiling all the way to the bank or banks and when Zambians demand for what is rightfully theirs they cry foul
These companies shouldn’t take our generosity for granted
The kwacha/dollar is not controlled by GRZ or BOZ. They can influence it policy formulation only. When you miss it there, the dynamics are off balance.
#64 true to what you are saying, #52 should know why IMF and IBRD were created and precisely in 1945, honestly speaking you cannot put diesel in a petrol powered car and expect the same performance and results, I hope 52 is deep enough to understand what I am saying (modelling)
#73 what are these dynamics? Maybe we can help these guys come up with these things are set them straight upfront. I was really of the view that BOZ and/or GRZ had a hand in setting the exchange rates in a way. Anyhow like #71 observed, most of the costs attributable to products and services in this country are those that are logistics related and taxes. Because I am told that items like perfume are treated as luxury so duty is 100%, I am told this is not based on something I have experienced.
In simple terms how do you make your exports competitive when the kwacha is too strong compared to others regionally? We cant export wheat to Botswana when they can get it from S.A much cheaper than frm here.
Precisely, if South Africa subsidises using taxes from their industries, why not do the same here so that we make our wheat cheaper? The question is what is it that RSA does that makes its wheat cheaper, I doubt it is just devaluation of the rand?
We need to find the right balance in the the kwacha rate. At the moment our biggest trading partner is able to balance their rand with barttered dollar relative to its losses but we seem to be jumping up with excitment as our goods become more and more expensive. Check whats happening with this oil increases on the S.A markets.
Balya manyina!!Let them go, the Chinese who are serious will be running to Zed
When the mines collapse over our miners they will simply import more labour. Our constitition will not yet be complete by then. no meaningfull compesation for victims. Yes the are good but very clever way above average!!
#78 sorry but we can’t compare prices in Zambia with south Africa, because the RSA far more economically stable than Zambia as is botswana, their govt can afford to give more subsidies than Zambia can..fact their govt of RSA earns way more than GRZ does therefore as #77 says its NOT the rate of the kwach thats the problem..it is that these countries are more financially stable and this increase in this mining tax is one step foward to increase the icome of GRZ which if they are clever they can afford subsidize goods more. Pliz the as mentioned before these companies do not keep their dollars in zambia the fraction of it actually spent on salaries etc is a very small fract
You guys, unrelated to this discussion- how can I read the post article about “ECZ eases requirements for Director”. I can’t subscription
*afford
Nabaleya bambala aba! we will keep our umukuba and mine it ourselves when we have built local capacity…..better to benefit from our copper in future than let someone get the benefit now and give us peanuts. Mukwai nabaleya ku USA nangu ku Chile and then we will see how much tax they ll pay there
Just pay. Magande increases tax for all of us as workers, we complain but we pay. U use our roads to transport the copper, how do u want them to be maintained. So pay or just go.
magande gets the money and does not even know what to do with it apart from electrifying chiefs houses and buying them Vehicles.. Come on let us use the money to invest in infrastructure.
We support the Mineral taxes, but we need to start seeing investment by govt to stimulate the economy….No need to be crying for Private investors in Power, tourism etc when govt can do so and then sell shares to recoup their investment.
Render unto Caesar what belongs to…These so called investors must pay tax just like any company in Zambia.What makes them immune to that anyway?Maybe they should move to the World’s Finacial Capital-London as that might teach them what tax is all about. Do they know how much Corporate tax is in England?
40 per cent.
An English friend visited the Copperbelt and during a conversation with a Mopani official he was shocked to hear that the amount given back to the community was less than a thousand pounds(> £1000 ).Does our government know that?
They have had it too good for too long. Those first agreements were signed with a corrupt goverment of mr FJT, were Zambias assets were litrally given away, lock stock and barrel. It is assumed that durring FJTs goverment SA scrap metal dealers were stripping Zambias scrap metal and taking to SA, the country lost funds to the tune of $250 million at todays metal prices.
They signed agreements with someone who is going to throu the courts for corruption.
Zambia is only asking for the world average Tax figures, whats wrong with that ?
I’m saddened to read some of the comments here, not least because of the “take it or go” attitude and the hatred contained in some of the comments. Let me identify myself first of all: I’m a small private investor in Canada (of African heritage) who sympathizes with the government’s and people’s desire to see more money from the mining companies.
However, while everyone, including the mining companies, would have agreed to a reasonable tax increase, the amount and (most importantly) the manner in which the tax has apparently been imposed will scare off many, many Western companies and investors. Keep in mind that nobody can complain about the tax applying to new developments —
-if you don`t like it, don`t put your money in Zambia. I agree. However, the legitimate complaint is that Development Agreements were signed with a number of companies, and the GRZ has unilaterally cancelled/changed these agreements without any consultation (which it said was to occur). Clearly, this cannot be good for the investment environment. Why would I, as an investor, or why would any company invest in a country that signs agreements, allows the company to invest millions or billions of dollars on the basis of those agreements, and then change or cancel the agreement after the money has already been invested? Frankly, only stupid people/companies would do so.
As evidence of what is likely to happen, witness First Quantum’s decision to purchase a company in Europe (a Scandinavian company I think), not in Zambia; Phelp’s recent decision not to participate/finance a smaller company’s drilling in Zambia (can’t remember the name); and Vendata’s recent decision to buy a U.S. copper company and its statement that it intends to spend 15 billion or so in India. (again, money not spent in Zambia). You get the picture: foreign companies are not interested in risking money in a country where agreements can unilaterally be broken. Remember, I’m for a tax increase, but the manner and amount is what is troubling.
As to the amount, why would I invest in Zambia, with its wealth tax that reaches 75 percent after 3.50 per pound of copper, when I can invest in a country that doesn’t have such a tax and that has more stability? The whole situation could have been handled in a manner that maintained foreign views of Zambia as a place to invest. Handled properly, over the long term Zambia could have potentially ended up with a greater net take from its resources. Alas, it appears too late! As an investor, I must say honestly that I will never, ever again invest in a company that has operations in Zambia – the rules of the game can unilaterally be changed at any time, so why would I risk my money?
Lastly, I would say that if the tax does go through on all companies, I hope it reaches the people.
*92 do your math well 75%…even magande is not that foolish
The quality of debates Zambians generate is always characterized by village type economics, lack of understanding of economic issues and childish platitudes. No understanding of issues. If it is so nice in Zambia why don’t you work there. If you have money why don’t you invest in power generation and help move the country from among the poorest 30. The country is suffering load sheding. You are working outside Zambia so you can buy a house in Zambia. Otherwise, you never own one. God forbid some of you take over the running of the country. The thinking you exhibit is no better than Idi Amin who thought all he needd to do to develop Uganda is to chase Indians. ! The country sunk into hole.
I doubt CHEESE is Zambian.
I can tell from his vocabulary and grammar.
#95 where you were supposed to have brians, there is water so you are forgiven, for you who have ‘city like’ economics, educate us, quite honestly you have nothing of substance to contribute that is why you are busy of being wishy washy instead of putting your point across and please do not despise the villagers, that is just geographic location, it has nothing to do with someone’s thinking and intelligence.
At the end of the day, if they feel our taxes are too high, they can just leave us in peace, we shall get the chinese who are investing in Congo and building roads and railways of 28,000 miles before they even start mining, that is more realistic.
#81 Nothing about subsidies in southafrica or Botswana makes their goods cheap. At the same time you shuold reckon with the fact that only policy formulation enables a Government achieve the right balance for their currency.
So are you saying that all those goods you could buy more cheaply in Mr Price S.A are subsidised by the Government? It has nothing to do with subsidies.
USA and Europe are the ones subsidising farmers and Developing countries, which S.A is, are calling for subsidies to be removed.
#81 What do you mean when you say that they are “finacially stable” or “economically stable”.
#99 then what is it they are doing that we can learn from? should we devalue our kwacha to 1 – 10,000 maybe?? The question is, at whose expense, because your fuel will go up three fold and all import based goods will spiral out of control. What do we have as a country to export in order to become a net exporter, I think that is the question, by the way I am not an economist, what do I know?
The kwacha rate should be such that when converted in Dollar terms it should be able to compete with its major Trading partners in terms of value. i.e the same amount of rand in dollar terms capable of buying 1 litre of petrol in S.A should be able to buy 1 litre or slightly more litres of petrol in Zambia if converted in Kwacha. This way it will be competitive. I dont have all data required but suffice to say out of my head- about $1 -> K4800.00
#98 — Your wish may very well come true, but it will not benefit Zambia or the Zambian people. Yes, it is likely that the Chinese will continue to invest in places like Zambia because of the ties between the two governments and the fact that they are less concerned about margins/profits as opposed to feeding their hungry economy. But make no mistake, those companies (generally) don’t give a damn about workers, the environment, the community, or Africa’s future. In addition to exporting their money, they will also export the corruption that is rife in China — and as you know, corruption is something that Africa does not need more of.
Those companies will rape your resources, grease government hands whenever they can, cut corners wherever they can, and then leave without any care. This is not to say that Western companies are all altruistic, but they definitely do not operate with the same mindset (largely because their domestic populations would not allow them to operate as such). I believe that net-net, in terms of financial, social, and political development, Zambia will be far worse off. It is not a path to a brighter future; rather, it is more like going “back to the future”. I’m very saddened by all of this, you should be too.
I was their in the 80’s still just driving a Japanese reconditioned Pajero. Ndefwaya new motoka not ifi fima reconditioned. Elyo ama bondi yatatu. Ndefwa more! Eh
This guy,the way he speaks as if he is doing as a favuor by openning new projects.Are you not the one intrested in making profit?Man, mwatulila sana amasuku pamutwe.We didnt force you to come and invest.If u r not happy pack and go there alot others intrested in our copper which is trading highly presently.
106 — if you are speaking to me, here is my response. No, you didn’t “force” anyone to invest, but what the GRZ did do is sign agreements with companies so that money would be invested. Then, without consultation, the GRZ has purportedly and unilaterally changed these agreements. There can be no real complaint about the taxes being applied to new projects – they know what they are getting into from the beginning. Go back and read all my posts, and you will see my full position. Let me give you an analogy. You are a builder and you contract with a landowner to build a house on his land. The plan is to sell the property (house and land) and split the profits 50/50. You build the house
but instead of putting the property up for sale, the landowner unilaterally says that now he wants 85% of the profits instead of 50%. He says, if you don’t like it, just go (either tear down the house, or he won’t even let you on the property to even do that). You try to negotiate with him and, being reasonable, offer a 65/35 split. He says too bad and repeats his ultimatum. You will not walk away or burn down the house — you will unwillingly accept the 15%. Will you take that 15% and enter into another venture with that landowner? Will your friends or neighbours, who saw what happened to you, enter into agreements with that landowner? You see my point.
kansanshi paid the dividend quantum First, why did she not done so to ZCCM-IH ….. Kansanshi FQM must therefore more than $ 200M to ZCCM-IH!
it is also true for KCM, MOPANI etc. ……
Guess what? His CEO position in Canada is held for him!! Sabatical Leave my ass!
9. Shi Mine says: Jun 12th, 2008 at 10:15 am
Ba Chisanga Puta Chekwe was literally away enjoying as CEO in Canada most of his adult life and has no idea how Zambia has been robbed by the so called mining investors including his First Quantum minerals. He sounds like a scratched record with his rhetoric from the “masters” voice. Its such individuals Government must closely watch as they have misplaced loyalties. His family is probably enjoying all the wealth in canada at the expense of our mineral wealth in Zambia. Its a shame for a Zambian to be so unpatriotic.