Tuesday, May 21, 2024

FQM Calls for Government support for the company to remain Competitive

Share

Finance Minister Hon. Felix Mutati: looking to the future of mining.
Finance Minister Hon. Felix Mutati: looking to the future of mining.
First Quantum Minerals (FQM) has made a three-pronged call for government action that will enable the company to remain competitive and boost economic benefits to the country.

An improved electricity supply, granting of a Multi-Facility Economic Zone (MFEZ) licence at Kalumbila, and the rehabilitation of the Solwezi-Chingola road hold the key to the profitability of the company, which operates the country’s two largest mines: the Sentinel mine at Kalumbila and the Kansanshi mine and smelter in Solwezi.

“What’s good for First Quantum is good to the Zambian economy,” said FQM Country Manager Gen. Kingsley Chinkuli during a three-day tour of the company’s operations by Finance Minister Hon. Felix Mutati.

“Our mines are an low grade, meaning that we must process high volumes of ore and achieve maximum efficiency in order to be profitable. Every element of our production cost, including electricity, transport and procurement, must be efficient for us to stay in profit and thus pay taxes, create employment and help grow the economy,” said Gen. Chinkuli.

In the spirit of a renewed partnership with the government, FQM, which is Zambia’s largest taxpayer, has pledged to continue to increase procurement from local suppliers, support roadworks on the vital Solwezi road, and enhance the skills of the 8,500 Zambian workers it employees, said Gen. Chinkuli.

Confidence in the competitiveness and stability of the mining tax regime was also a prerequisite to the company continuing to invest and achieve the economies of scale necessary to survive in the context of depressed international copper prices, said Gen. Chinkuli.

In touring the Kansanshi mine and smelter on Sunday, Mr Mutati assured the company of the government’s continued support and said: “The principle philosophy for us is that we must create wealth in partnership for mutual benefit. We must have an equation that is balanced: balanced on the mining side and balanced on the people side, which is the people of Zambia. On the mining side, we need to begin to address the bottlenecks that are being encountered, such as power. We are going to sit with the Minister of Energy to see how best we can address the issue of power.

“The other bottleneck is the policy environment. They [FQM] want reassurance that the policy environment remains stable. They intend to put in another US$1.2 billion investment providing the policy environment and the hurdles are solved.

“The third level is the bureaucracy, which is stopping industrialisation. There are projects in waiting over US$100 million but for a variety of bureacractic processes those have remained in the waiting pit. We must look at what are the limitations from our side as government that are slowing the growth of tax revenue. Let’s resolve the bottlenecks that are being faced; that are associated with bureaucracy. Let’s start with policy dispatch that is predictable and stable. Here we have an opportunity to convert what is waiting by wealthy investment into practical output creating over 1,600 jobs.”

He continued: “Our goal is that within the next two weeks on the government side we should be able to resolve those bottlenecks so we can unlock this investment. At the higher level, how can we engage with the sector and in particularly with FQM, so that what is waiting, the US$1.2 billion additional investment, should also be unlocked? As the mines invest millions in the economy we must have millionaires at the local level and that is the direction we must take.

“Bureaucracy is holding back the growth of GDP and here alone with can unlock at least an additional 1 or 2 percent of GDP because 70 percent of the copper production in Zambia is coming from North-Western Province, so we need to sort out these bottlenecks, including the Solwezi-Chingola road.”

First Quantum Minerals (FQM) has invested US$5.7 billion in its Sentinel and Enterprise mines, and Kansanshi mine and smelter, and has paid more than US$3 billion in taxes in the last ten years, transforming the economy of North-Western Province and creating employment for more than 8,500 people.

In addition to being Zambia’s largest taxpayer, First Quantum Minerals produces around two thirds of the nation’s copper. The metal accounts for 60 percent of Zambia’s exports.

First Quantum Minerals and the Zambian government: looking to the future of copper mining.
First Quantum Minerals and the Zambian government: looking to the future of copper mining.
Finance Minister Hon. Felix Mutati and FQM Director of Operations Matt Pascal: looking to the future of mining.
Finance Minister Hon. Felix Mutati and FQM Director of Operations Matt Pascal: looking to the future of mining.

7 COMMENTS

  1. In a banana republic, one might slip on a banana peel but things do work – now and then for the people, albeit inefficiently and unreliably.
    – George Ayittey

    • Only a few people in government will continue benefiting the fruits of having mines in a country like ours and yet the Majority are wallowing in abject poverty. Its very annoying to find out that Northwestern Province has continued lagging behind despite being the hub of the country’s revenue.

  2. The only way you will get them to do anything is when their companies are awarded supplier contracts at the mine other wise those PF ministers will sulk and site on reports and recomendations for years

  3. This mutati guy of a minister just came to learn how his predecessor used to make money.useless dyamo_dyamo *****s.alex enriched himself & ka mutati also wants to do the same .we know the scheme.fqm is the biggest crook but cant do minus corrupt mutati.so welcome to the game mr mmd president minister of finance in pf grz.what a fonteen…kkkkkkkkkk….does he even knows what it mean to be in oppostion?

  4. Please note in the pictures, all those whites are extremely wealthy and slim and the blacks have all got pot-bellies with no hope for Zambians. My hope is in the FQM owners.

  5. Multi-Facility Economic Zone (MFEZ) licence at Kalumbila: fyabupuba. They want to create an enclave of their own; with rules and all. Just ask how much is the serviced land in Kalumbila and you will know why Sata did not sign this MFEZ. Mining is supposed to create twin towns; assuming you deal with the supply chain in order to allow Zambians to supply.

    • How do you allow a mining firm to go into all forms of business sure? They mine, they build towns, houses, schools, and the lot!! So what forms of business would a local guy go into considering he/she has no access to cheap finance? These are the issues government need to look at. At the schools, they get expatriate teachers, surely, have you seen the list of unemployed teachers? why shoot ourselves in the foot all the times?

Comments are closed.

Read more

Local News

Discover more from Lusaka Times-Zambia's Leading Online News Site - LusakaTimes.com

Subscribe now to keep reading and get access to the full archive.

Continue reading