Zambia has extended tax waivers to U.S firms seeking to invest in an economic zone initially created for Chinese companies that plan to invest $900 million in manufacturing of copper products, a minister said on Monday.
Felix Mutati, the commerce and trade minister also said South Africa’s property firm HBW Developers has been awarded land to construct a shopping mall and offices opposite the Chambishi multifacility economic zone at a cost of $160 million.
Mutati said firms manufacturing computer software, vehicle spares and other products from the United States would be part of investors in the economic zone and that they would enjoy the same tax benefits as Chinese companies.
“The Chinese have been courting major U.S. firms operating in China to come and invest here and we will offer them tax incentives as well,” he said. “This will also apply to any other foreign companies regardless of where they are coming from.”
Mutati said the Chinese would also construct 3,000 houses in the economic zone.
China Non-Ferrous Metals Corp., (CNMC) is already constructing a $250 million copper smelter in Chambishi, 420 km north of the capital Lusaka, where the government has zero-rated corporate tax for the first five years of operations and deferred payments of 16 percent value added tax.
Mutati said the government had also waived the tax on dividends and customs duty of capital equipment, in a move which has attracted 50 Chinese firms so far.
“We expect that the opening up of the zone to other global players will attract more investments and create more jobs,” he added.
Mutati said an initial 6,000 direct new jobs would be created in the Chambishi zone with an additional 15,000 indirect employment created by local contractors who would be supplying various goods and services to the foreign firms.
He said South Africa’s HBW Developers and a local firm, Phoenix Supplies, would jointly invest a total of $190 million in a shopping mall in Chambishi, including the expansion of a shopping mall in the capital Lusaka at a cost of $30 million.
Zambia has in the last five years liberalised its investment policies awarding tax incentives to foreign companies in a bid to grow the economy, create wealth and employment for its impoverished citizens. Treasury data shows that 64 percent of Zambia’s 12 million people live in abject poverty.
Reuters
Bullsh!t
Crap!!!!
Can’t really understand what is going on!!! It was initially created for the chinese and now being extended to US firms???? Please Minister explain well!!! VIVA HH!!!!
At whose expense? Anyway $900m is alot of money, just so long this tax break doesn’t go on for years and years.
Our Government is confortable to relieve the tax issue with foreigners than its people, though this development is welcome
Ho Ho Ho!
Can I have the same on my sweet indusrty I plan to set up in Kaputa? I am going to build an ultra modern town for the locals. I will even build a mosque and houses for the locals. I have British friends who are willing to come and help teach locals for free. I promise to pay Zambians the minimum wage (as if one could survive on it). Ministers are guaranteed nicekeleko.
I inted to spend about $901m. How about that?
Ho Ho Ho. Fools!
this is good coz we need the great US IN ZAMBIA
What ? ECONOMIC ZONE ? Iam not an economist but i sence something is not being done in good faith. The zone was for the chinese and now to the Americans, South Africans and others.
-Tax waivers to investors, so how does the government benefit from the investiment. These guys will get our minerals free of charge.
-Chinese are building houses for themselves not for us Zambians. Nway time will come when one should be made to explain this.
-Finished products will be brought in tax-free and sold to us at exorbitant prices ? Interesting, we need an economist to correct things…
The economy in the USA has melted where is the money going to come from? most of the Lenders are burst what a pity. CAPITALISTS. please dnt bring their problems here
you relieve tax to foreigners and bring down your own Zambian airways. lets encourage investment but not to a point of deseparation
lets hope so
We need investors as long as they are not briefcase investors.We should also encourage local investors to come on board!Arise zambia and develop,the set time has come,no demon will ever frustrate zambia!Zambia is born again
#11 I rarely agree with Zambians. Couldn`t have put it better myslef. I remember a certain muppet from ZRA wanting to make me pay for my 10 year old son`s laptop. What a wank*r!
I was made to pay for sweets I brought to give for free in my boat lol!
Ho Ho Ho!
Rubbish!! Companies that can and left only to operate during the 5 yr tax incentive: Smart Center/ Alkermans/Dunns/Supreme Furniture Group/Anglo American/Bonita (now under differnt owners)/Shoprite (almost left in 2006 but was pressured to stay)/ and many more. Why dont we learn, why cant we give Zambians tax free for five years & with vat excluded? Knowing the Chinese, we know some people have benefited. It has never been true that Cjina can strike deal without bribing. One day ther will be an enquiry to investigate corruption by the anticoruption for covering this.
China’s development is based on the concept of economic zones, which are areas of industrial development with limited tax cuts and other special facilities to foster profitability. This has prompted many foreign companies to invest in China at lower costs and higher returns. That’s how most western companies went east.As much as the Chinese are investing in other countries, their economy also relies on a lot of foreign investment. All we should do is set up good regulations so that Zambia can benefit from such investments.
The same agenda as Americans are refusing in their own country. Tax cuts for the rich so that they have more money and more taxes to us the poor so that we stay poor. To think that I am paying 35% on my salaries and 15% for the house I’m renting. If I get a loan then I pay another %. We need tax cuts too. They don’t even use tax-payers money well. GRZ should restrict their cars to Corollas and other cheaper vehicles. Instead they are wasting it on expensive stuff that even rich countries don’t allow themselves to get.
SSDD
Give the same tax waivers to Zambian companies you yokels.These so called economic zones will be white elephants shud the investors decide to relocate.
VIVA HHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHH
I am soooooooooooooo haaaaaaaaaaaapppppyyyyyyyyy the USA is investing in Zambia.
It is about time. Finally eh!
I have been waiting for this moment for sooooo loooonnnnnnnngggggg. Americans will bring good jobs and will pay resonable wages.
Thank you Lord Jesus. Finally, investment we can all trust.
The chinese will soon be the third largest tribe in Zambia with mandarine as one of the eight major languages spoken in lusaka and the copperbelt . Chambishi will be the first town to have chinese signs mark my word and let zambians rise up
Thats not fair.Every company should enjoy the same conditions.Zambian companies should be excused of paying tax.Just the other day you were saying zambian companies are not reliable now you say something else.You are traitors
Pastor J bamudala,we can be developed based on Chinise policies, we can not be copyctas.We at the moment have every comparative advantages for investment.It depends on how we handle this opportunity that we have,mwa nvela ba pastor,They use to dance and boast about their country and even looked down on us,calling us names, so when they come here its because they want benefit from our advantages so let them pay and bear the due cost of the benefits tehy are going to get.
That is the only way you are going to attract investors, not what poor finisher (PF) president is promising you that he is going to create more jobs with out attracting investors, diplomacy tapaba ba sata. Of course govt should consider zambian investors also
Thre is NO evidence ANYWHERE that investment brings development!!
We investors come to Zambia for MONEY MONEY, EASY MONEY AND MORE MONEY.
Your grz gives us tax holidays for 5 years – holiday time after which we leave. We are in Zambia on holiday!! NOT, like some dull minister thinks, to bring development.
Development happens at home, where we come from and where the money we make from Zambia goes. Tax holiday only increases the sums we take away.
You want development? It won’t come to Zambia because of us. We are here to develop OUR own countries. Grz wants development. We want to make money and you DON’T achieve that by developing Zambia. Wake up Zambians before we take everything
You don’t know the U.S. Why even give them tax cuts when they are the ones who print dollars? The U.S is not supposed to fall into this category, are you crazy? It’s like introducing free education for children of ministers.
Our govt is quick to give tax consession to foreign investors but dont support our local investors as much as they should.Even in the developed countries local investment has been nurtured up to a point where they can stand on their own.Local industries are stuggling with high taxes and govt has just turned a blind eye.Zambian Airways amongst just asked for more time to pay their bills and not tax consessions but they have not been supported by govt.Its more of a personal vandenta at the expense of citizen empowerment. Zambia Airway employs more that 250 employees, who are given better conditions of service than the so called foreign investors…Lets VOTE WISELY!!!
Where are these Americans going to get the money from? I guess China.
GRZ must facilitate Zambians geting monies from China. Otherwise after some years Zambians will continue to beg from China and the americans. We need to concentrate on ourselves to develop the nation.
Mutati…don’t be in hurry and overlook the interest of Zambians. These cheap jobs being creation are not enough to forgo tax from these foreign companies. We need tax to develop.
This is Total Bullsh!t, Chilimpamushi has lost his mind, Where the economists in both the ministry of commerce trade and industry and finance, these are very bad investment policies being put in place. Which country in the world gives investors Tax incetives or zero rated tax. Zed will never develop economically if we are going to be having such ministers who can approve such CRAP!!!!!!!!!!!!!!
Sata for president so that we can suck such ministers.
Bullsh1t people. And why is these same economic zone based only on the copperbelt and lusaka provinces what about other provinces dont they need development and the bullsh1t investment going on in Zed at the moment.
Ba MMD, u have been in power for more than 15yrs now.why didnt u create zambia as an economic zone in those years?This time around we dont want pipo to shower us with ECONOMIC terms but actions.Your leader has so much traces of corruption hence the ECONOMIC stories are not welcome.we know u and the pipo surrounding the so called RB. Your time is over.Viva pa bwato viva…….
This is good news in terms of development. It is good investment if these guys will be building things for the country, by so doing most companies fail to change thewir minds and stay there. Have you noticed why most companies like our friend above #14 has mentioned those of Alkermans,supreme,Barnets, it because these comapnies did not build any property they just paid rent. Those who have been in Bostwana and have followed their policies will agree with me. Do you know why investors dont leave that country? Its not about the diamond. Its their law, policies, an investor must build their own structures (property) if they want to invest in it to do business & because to build its expensive
So how does the local man benefit from these ‘tax breaks’ apart from a few that get employed with poor benefits and salaries??? Most of the money from these guys are returned by there executive’s salaries.
Cont. From 29
so many investors cannt just go if they are to go they are free to do so, they cant go back to their countries with it as its something permanent and leaves the country looking beautiful. And if they are to go they will need to sell it, selling it means they would have to sell to someone with lots of money as most of these big companies are a chain, as in being in many locations.
The government in Zambia doesnt seem to worry much about not getting taxes from foreign companies because they are creating jobs for many Zambians and will be getting taxes from them such as PAYE-pay as you Earn.But it would be better if they can reduce the years to atleast two or three NOT 5.
Nonsense!
Foreign investment is good but why can’t we do similar things for local business people,home grown iniative,you will find,is always far more beneficial than these tax break driven investors…..
lets hope the Gvnt will do a good job with the uraniun deposits(with copper prices much better now) and then channel the revenues to manufacturing and agric….
twilatemwa ukulomba,we are a country for crying out loud……
If applied sensibly, tax incentives for investors can help boost the economy which. I think local investors should also be given tax incentives. Regulatory compliance is not easy for many Zambian owned businesses.
We are true black Zambian investors with solid structures that show our zeal to develop this country. The Investment Licence is for foreigners who show a bank statement of how much cash they have in their bank account abroad. Based on this paper, an Investment Licence is issued without question. This is what it means to be a Zambian Investor. A truly painful situation.
Trigo/Leona are asleep! Tax-free FDI good?? For us(foreigners) yes, for YOU Zambians NO..Think !! The only way you can benefit a little is if you insist on certain conditions, eg. participation in our businesses by locals as is the case in Mozambique; even 30% would do, then limit employment of foreigners, insist on local participation in management, equal pay for equal work, formulate intelligent labour laws and enforce them on all of us. Since we dont pay tax, we should be made to take some social responsibility for communities in which we operate, ie. participate in your efforts in education and health and not be allowed to degrade infrastructure + the environment as we are now doing…
good point #29. Let investors be asked to build. look at ba Mwenye, they have been trading for years without proper building infrastructure and Zambia still looks terrible
I agree with #36. We should limit foreignors holding jobs Zambians can do. There are regulations in the law giving an exact number of years they should be allowed to stay. During this time they should train someone local but when they come especially from Asia they don’t want to go back.
No way, no how, no tax breaks!!!!! Unless the so called investers are going to be well regulated. Look whats happening in america. We can learn quite a lot from them. GRZ dont act out of desperation.
Instead broadening th tax base.these pipo are exempting pipo for 5 yrz..js hw much wil tht be..thy wil js go lyk supreme furnishas,barnets,ackermans and dunns hu left imediately afta th tax holiday.do smthn sensible imwe
De Yankees dem after more than just investment. Better watch dem before dem bring anoda AIDS pon de land!!!
please Mutati extend the tax havens even to local investors so that the playing field is levelled.it does not make sense to give tax incentives to foreigners who already have enough resources at the expense of indigenous Zambians.there are alot of Zambians like myself who have the capacity to invest successfully in our economy.All we need is a conducive environment.After all Zambia Yesu bonse.
A good development. Let’s see what becomes of it.
Here we go again. Firstly it was Chiluba, selling our country to foreigners and now its happening again. Why do we always have to afford these so called investors tax free conditions. Its us the poor zambians that lose out in the end because the taxes they would pay would go a long way in helping us deveolop. They make their money and immediately take it out of the country and we get nothing in return. Yes we need them but we should not let them step all over us. We have the resources they want so badly so why should we always have to go back to the slavery days of doing business. We need a leader to stand up and speak up for us. Lets get some ‘b@#?s’ and get whats right
Keep it up! Excellent attractive posture for FDI. Mutati, I commend you and your colleagues. Surely 5 years of tax break is good enough for a company to flourish, recoop profits and create employment.
It is good to manufacture car parts, computer hardware and other good locally. These are the goods that Zambians have been chasing by flying to South Africa, Dubai and Malaysia. These goods are manufactured by either the US or China even in other countries. Don’t listen to these boys on this forum who just went overseas on poor British council scholarships and think they will impose anything on us. Everything to them is “Bull$@”. Everything is trash as long as MMD is the champion of it.
What!? Iwe Mutati, do you realise that the so called Mulit-facility Economic Zone in itself is a no-direct-income venture for the govt? and now you are going to exclude every Jim and Jack from paying tax so that they rob us even more? When are we ever going to develop sure? Are these Americans going to build infrastructure or we will allow them to ‘rent’ as usual? This is a zero for govt apart from a few jobs that will be created! Somebody must stop this nonsense!!
contd…I wish the package had included a clear requirement for these firms to invest a good sum in developing their own infrastructure, then we stand to benefit more even if the ‘infestors’ left. I hope we are not stuck in the economics of poverty
Nonsense!!! Nonsense!!, Mutati and your friends in the leadership please can you stop for a min and think about what dangers you are doing to the Zambian community in the name of tax waivers for the so called well wishers investors, why continue doing such things when people you are extending this gesture to hare well financially. thats why Zambians will never at all benefit meaningfull from such ventures. Its for sure that thse investors have already put money in your pockets hum! this present government lack wisdom. too much investment is a danger to the nation. coz that way the nation looses alot of money. be mindful that there is no investor who will have the plessure to keep his man in
His money in the country where is making money; Mutati please think. let these people pay taxi for our nation needs it for God’s sake!!!
what makes you think the Americans are investors to trust? Have you people not learnt from their international relations that America only cares about countries that eitehr follow America’s policies or countries that have something America wants look at Iraq and Afghanistan – those guys have oil and the so called America you as sooooo trusting to be “good investors” infiltrated those two countries like flies to a pile of manure and for what purpose? definately not to enrich these two countries but to get thier oil and infiltrate American policies. look at what they are trying to do with N. Korea or China? Same story with China as well. I support development of Zambia by Zambians.
continuing on. i think the minister or foreign affairs or the office in charge of foreign investment should be stringent with these investors. the last thing we need is more “false investors” coming to plunder our natural resources and then taking all the monetary profit back to whereever they come from. don’t tax them but make sure that in the years they decide to invest in this country they pay back to the country through means of building infrastructure and setting up development schemes that way they get thier profit and we get our development a win-win situation for all esp. the poor people. if they can’t chase them all away!!
what type of bullsh*t is this. Makes me wonder if mutati and magande really graduated from the university, this is not thinking. such type of recklessness will only cause xenophobia in this country. the jobs and houses wont be for us! the lucky few who will get jobs will contibute 35% of their money to VAT to make up for the investors deficit. the americans have messed up their economy and theyre coming here. as for the chinese and their poor record (the melamine milk scandal) i call for extremely strict and stringent medicals before these chaps come, theyll only bring trouble. this investment shud be 51%govt and the rest for these fima investors