The Green Party has demanded that Finance Minister Felix Mutati should draw lessons from compensation of Lap Green Networks and abandon his controversial scheme to sale 17.3 per cent of hares in the Zambia Consolidated Copper Mines Investment Holdings (ZCCM-IH).
Government has been ordered by the London High Court to compensate LapGreenN $382 million following the repossession of ZAMTEL shares by the PF Government in 2012. LapGreenN bought the shares during former president Rupiah Banda’s reign at a cost of $252 million. The taxpayers will now have to pay an extra $130 million simply because of adamancy of incumbency.
The privatization process, which was finalized by MMD Government in 2010, had met with some resistance from the opposition with then main opposition leader late Michael Sata saying he would re-nationalize the operator if he won the election the following year. When he won elections in 2011, he implemented his threat.
Despite strong opposition to the deal, Mutati announced in Parliament last week on Friday that his government would soon sale 17.3 per cent of its shares in the Zambia Consolidated Copper Mines Investment Holdings (ZCCM-IH).
“Mr Speaker, allow me to appraise the House on the intended sale of 17.3 per cent to have these shares in ZCCM investment holdings held by GRZ and listed on the Lusaka Stock Exchange. Sir, the long term strategic plan is to reposition ZCCM Investment Holdings for growth through strategic partnership and to comply to LUSE requirements. LUSE listing requirements stipulates that ‘no single shareholder should control more than 25 per cent of equity in any one listed company’. In compliance with the listing requirements, government intends to sale 17.3 per cent of its shareholding in ZCCM investment holdings,” Mutati said.
But Green Party leader Peter Sinkamba says the excuse of LUSE requirements which Mutati used in Parliament last week is typical of State Capture corruption dealings.
“What is happening on the sale of ZCCM-IH shares is typical State capture corruption dealing. This type of corruption occurs when the ruling elite and their powerful businessmen friends manipulate policy formation and influence the rules of the game, including laws and economic regulations, to their own advantage. The captured economy is trapped in a vicious circle in which the policy and institutional reforms necessary to improve governance are undermined by collusion between powerful firms and state officials who extract substantial private gains from the absence of clear rule of law,” Sinkamba said.
“The excuse that Mutati is using of LUSE requirements is highly deceptive. It is the worst form of dishonesty from a senior Minister for that matter. We are aware, for example, that the British Government this year had to bend listing rules on the London Stock Exchange to facilitate the listing of $2 trillion worth Saudi Aramco, a sovereign Corporation of Saudi Arabia, so what is Mutati talking about” Sinkamba quizzed.
“If it is in the interest of a sovereign State, a responsible Government can amend the laws. So, the Zambian Government can simply amend LUSE listing rules to exempt sovereign companies from application of some regulations if they are not in the greater interest of the State. This is perfectly normal everywhere in the world, and Mutati, as a senior Minister ought to know this. But here you have a situation where Mutati has already concluded a deal with Israeli firm Sapir Capital Group from Israel to buy off the ZCCM-IH shares in typical State Capture corruption, and he is using policy and rules to justify the corruption,” Sinkamba added.
“That is why, as the Green Party, we have always advocated for transparent governance reforms to share the power in the society, both horizontally and vertically, and to put in place very clear conflict of interests rules. State institutions should have safeguards to prevent them from being “owned” by specific individuals enjoying a high discretionary power, as is exhibited by Mutati in his capacity as Finance Minister,” the Green Party leader said.
“The trouble is that on one hand, vocal civil society groups, which are supposed to compliment the opposition on providing checks and balances can no longer champion accountability and responsiveness from the side of the government without the risk of being arrested and prosecuted, as demonstrated on the 42 fire tender deal. In such difficult contexts, the feasibility of any type of governance checks is diminished. The situation is likely to be worse if business dealing of the Guptas of South Africa with the political elite and their families in Zambia are entrenched,” Sinkamba said.
“We demand that Mutati abandons the dirty scheme of sale of ZCCM-IH shares. The scheme is not being done in public interest but personal interest. It is such deals that lead to re-nationalization in the future. We therefore, once more, appeal to Mutati’s consciousness for introspect and shame,” Sinkamba concluded.