Mine workers in one of the Zambian Mines on the Copper belt
Mine workers in one of the Zambian Mines on the Copper belt

The Engineering Institution of Zambia has urged mining companies to reconsider their position to downsize on employees as a direct response to the 2019 Tax Regime.

EIZ President Engineer Sydney Matamwandi said the mining companies must critically re-examine their cost structures and supply chain costs.

Engineer Matamwandi says it is saddened to learn that some mining companies have taken resort to scaling down on production and downsizing on employees as a direct response to the 2019 Tax Regime.

He said there is an opportunity to achieve cost efficiency if the mining companies enhanced buying local services and increased local employee numbers.

Engineer Matamwandi said this approach would be a solid hedge against foreign exchange costs in addition to increasing the competitiveness of local service providers as well as the overall competence of the employee pool within the business environment.

He has reaffirmed the Institutions commitment to ensuring that the mining companies prosper and that the Government continues providing the services as well as an efficient environment that is the foundation for the long term competitiveness of the mining companies.

Engineer Matamwandi expressed hope that the mining companies will take up the challenge of exploring and effecting cost efficiencies that feed into the improvement of resource mobilization that the Government has put in place without harming production and mining income.

He stressed the need for consultative dialogue at the earliest opportunity to ensure that decisions made do not undermine the national development agenda while ensuring that the viability of the businesses whose taxes drive the economy is not compromised.

Engineer Matamwandi said the EIZ has taken keen interest in ensuring that mining companies prosper and contribute to the overall development of the country and they clearly understand that the primary role of management is to deliver shareholder value.

He said it is this return on investment that attracts investors to commit capital that is essential to the success and continuation in business of any enterprise.

Engineer Matamwandi said on the other hand, it is common knowledge that services provided by a national government are a catalyst for investment and are essential to the prosperity of enterprises engaged in business in the country.

He said in a statement that such services include good infrastructure, social services, a healthy workforce, a secure environment and a support system in the form of an effective civil service among others.

Engineer Matamwandi said these services have a direct impact on the efficiency of any business inclusive of the entire support supply chain adding that the Zambian Government has gone further in this effort by committing to supplying electricity to mining companies at rates that are not financially viable.

He said the changes to the tax regime are an effort to enhance efficiency in the mobilization of resources essential to the delivery of the support services the Government is rendering to the mining companies.

Engineer Matamwandi said these services directly feed into the long term sustainability and competitiveness of the mining companies.

“The mining companies have opted to reduce production and consequently turnover. It is not clear how reduced turnover will increase earnings. It is our view that this action adversely impacts on all stakeholders including the shareholders”, He added.

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26 COMMENTS

    • Very laughable. Only an engineer in a Third world country can call for mass employment of people to increase production

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    • Everywhere in the world these jobs are being replaced by machines because the are inhuman, not cost effective and unproductive. Yet some unexposed chat calling himself engineer fimo fimo is calling for labor increase. One wonder lady how God managed to concentrate so much foolishness in one country

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  1. Cost efficiency includes going mechanical and robotic in production and you cut down human labour

    What kind of engineers are these. They are third world engineers

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    • And why would they opt to go ‘mechanical and robotic’ this time around. The technology of robotics is not as easy as some people might think, there is an ongoing technology and is extremely expensive.

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    • @courage the cowardly dog

      I like you argument. But my case is very simple. The engineer talked about cost effective method of production.

      I you buy a wood pecker that machine will replace 200 workers. You just have one operator to pay insurance and opposed to big number. And you reduce occupation health hazards.

      That is engineering. You dont need so many labourers on your balance sheet.

      An engineer makes things easy for an entrepreneur.

      Dont fear robotics. Their is moving fast and kids are now going abroad for school where artificial intelligence is becoming reality.

      I love young people. This country must be run by smart kids who DON’T worry about speaking in Tonga or bemba.

      Am seriously considering going into politics. Not bemba/Tonga politics. But smart politics

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  2. Being a member of E.I.Z myself.. I say to you sir.. you are presiding over a ramshackle organisation that has little value in this country. Your advice is so misguided I am beginning to wonder if the comfort of getting hefty salaries at the expense of our annual licence fees is beginning to cloud your resoning or should i blame the lack of exposure on your part from knowing that effectively 1 st jan, Zambia is now top 3 most expensive mining destinations in the world

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    • He may be presiding over a ramshackle organization, but at least he is rallying behind his government, unlike you rallying behind foriegners and racists. When will you ever get out of your cocoon.

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  3. Engineer whatever whatever this is not good engineering. Cost effective production using engineering concepts eliminates human resources rather seriously. What kind of engineer are you kashi. You are contradicting yourself with your ignorance. Yes Zambian mines are not cost effective because of bogus engineers like this guy in question. His theories are rather empty!!!
    What a disaster of engineers!!!! in Zambia.

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    • The EIZ president is right. These mines make profits by massive production which cancels out all material, labor and tax expenses. If labor is downsized, how do you expect the mine to pay for these expenses since production will reduce as a direct consequence of job cuts?

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  4. Zambians need to adopt innovative lean management principles…if it means downsizing, EIZ should know better let them downsize!!

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  5. He is speaking for himself, appears not to know what he is saying – indeed third rate engineer mostly copy and paste.

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  6. We should start teaching Business and Accounts from Grade one and this should be compulsory through to all Tertiary disciplines!
    Zambia has messed itself up because of chosing leaders who don’t understand Business and Accounting Fundamentals! ZICA, we have an opportunity here to come up with a good curriculum to help all citizens understand money! To make our people understand the difference between working Capital and Gross Profit! Not every truck hauling Copper represents profit!!!

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    • Even having the so called “owners” of KCM on tape laughing at your a$$es all the way to the bank to cash in, you still think these mines/”Investors” are making losses????

      When are some of you people going to wake up? Please Lord, help this forsaken country, please!

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    • @Yambayamba, exactly my point! Zambians are generally lacking in Business Accumen and all they know is how to steal! The ownership structure of the mines in terms of shareholding is what makes Investors benefit more than Zambians! How did our leaders and technocrat accomplices manage to give away 80 to 100% ownership to foreigners? Zambians are literally spectators in their own economy! My point is we must go back to the drawing table and get 50:50 ownership of the mines! Botswana actually maintains 51% shares in all their privatized state businesses and offloads those shares to the citizens! Tanzania recently increased its shareholding in the mines. Why don’t we do the same? Crying Royalty tax this or that won’t help much because Royalties are the lowest levels of realizing benefit…

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  7. I am scratching my head how tax can affect their bottomline when they pay their local workforce in Kwacha and sell their goods on LME in dollars ..let them downsize

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  8. …..uuhhmm, engineer Matamwandi lots more better than economist party cadre Haabazoka….correct spelling I hope.

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  9. Vote Trib.al Hacks, there will be no taxes, there will be free electricity, free education, free medical services, free water, free transport for all. Only thing that he requires is that each one of us build our own family road to Ndola, Lusaka, Namwala; our own classrooms for our children, our own hospital ward, our own bridges for our family….and oh, our own family water pipeline and treatment plant……kikikikiki

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  10. @coward.. i can see u have already misunderstood my comment… i wish i was living in a cocoon. That way i would seek comfort in Ignorance. I am not a supporting any player in this game. Just noted that the advice coming from him is like a broken cistern. He must be a product of the defective education system. Jets is supported in schools but how many of those inovations Have ever been commercialised??? E.I.Z.. is in the wrong hands

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  11. I hope Engineer Matamwandi is not speaking on behalf of EIZ. I find it hard to believe that an engineer is failing to base argument on facts, not hearsay. The mines have stated points of argument why they would lay off workers. It’s up to the government to come up and prove with numbers how much the production of copper cost and how much profit the mines make. My suggestion is that let ZCCM-IH increase more shares in the mines so that workers are not laid off. Secondly, it will teach the government a lesson how to understand mine business so that the government can make decisions based on facts. Just yapping will not take as anywhere. It is my wish that the government makes a wise decision.

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  12. In Game, all parties make counter moves. If mines want to replace the workers with machines, fine!! Kingsley Chanda should tax those machines to the hilt. In fact, just double that bill for the machine spare parts they dubiously classified as capital investment. The first bill was for nullifying their VAT claims. The new one will be for our blood. These capitalists morons always think every game is child play. This time it isn’t. They can make their next move, we are up to it.

    The lesson from the 1970s is that ultimately mines have to be bought back. That, ZCCM IH can do from reserves it has built & some financing from China. Zambians in these mines should prepare to manage them.

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  13. …blah blah blah….that’s where we get it all wrong…It you called to wake up it doesn’t mean to support anything the government says….without even having the apt knowledge and understanding of the issue at hand…..from the ranting in the article I can tell sir you need to up your sleeves in business operations…do a crash course in Executive Business courses they are there…..otherwise it would have been better for you to comment on roads and bridges being washed away ….maybe then Civil engineers would have prepared you a nice article though they are the most corrupt engineers I know of….at least from what I see around even I a lay person can’t tell things are not done correctly but a Civil engineer will be there in his big car…watching/supervising….rubbish!

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