Mining giant Konkola Copper Mines has started paying out debts owed to local suppliers and contractors following the directive by Copperbelt Minister Bowman Lusambo for mining companies operating in the province to prioritize the payment of local suppliers and contractors.
KCM has a monthly bill of around US$4 million for various goods and services but has not been paying its suppliers and contractors for sometime.
On Tuesday, Mr Lusambo addressed a media briefing in Ndola and directed mining companies to ensure that local contractors and suppliers are paid on time.
Mr Lusambo said there is no reason why mine Suppliers and Contractors should be struggling to get their payments for their services when international Copper prices have been on the rise.
The Copperbelt Minister also condemned the practice by some mining companies to have their procurement departments operating outside the country.
Mine Suppliers and Contractors Association of Zambia President Augustine Mulenga confirmed in an interview in Kitwe that KCM has positively responded to the directive by Mr Lusambo to clear the debt owed to Association members.
Mr Mulenga said his members welcome the move by KCM and commend Mr Lusambo for the intervention which he said is timely.
“This should be a normal business for these mines. Our members supply a service and they expect to be paid. We are happy that Mr Lusambo has shown that concern which is expected from government officials over our plight. This is commendable,” he said.
He said mine Suppliers and Contractors play a critical role in the economic development of the Copperbelt adding that his Association is hopeful that other mining firms will heed the call by Mr Lusambo.
Mr Mulenga said delays in paying out monies owed to local contractors and suppliers has the potential to strangle the economic viability of the province and increase tax liabilities of mine Suppliers and Contractors.
“For us, our invoicing is usually 30 days and if we are not paid within that period, it creates a lot of problems for us with ZRA. Our hope is that what KCM has started become the norm and other companies emulate this spirit,” Mr Mulenga said.