The Economics Association of Zambia Copperbelt Province Chapter has described as unfortunate and ill timed, the sentiments attributed to ZCCM IH Chief Executive Officer Dr. Pius Kasolo regarding the new mining tax regime.
ZCCM-Investment Holdings (ZCCM-IH) Chief Executive Officer Dr. Pius Kasolo reportedly said during a press briefing that the 2019 planned mining taxes would impact negatively on ZCCM-IH which holds shares on behalf of the Government in the mining companies.
But EAZ Copperbelt Chapter Mathews Muyembe said the motivation behind Dr Kasolo’s remarks begs an answer as government was already engaging the respective foreign mines and positive strides were being made to achieve a mutually beneficial consensus.
“While we appreciate that every company’s objective is to increase its top line and maximise the bottom line, the mandate of this holding is to represent and reflect governments will which is to improve the welfare of its people through provision of employment and social services,” Mr Muyembe said.
“In the recent past we have seen the mining sector drop in GDP contribution as well as
tax avoidance schemes through transfer pricing and continuous declaration of losses. Even with the incentives such as electricity subsidies and tax windows the mining industry participation in economic growth has been declining over the years, he said.
“In October last year government did indicate that no mining operations will be affected by the new taxes, and the fear that job losses would be precipitated by the new taxes was later allayed as mines agreed to meet government and amicably resolve any apprehension around the new tax regime.”
Mr Muyembe said ZCCM should know that government desires more return beyond dividends as the trickle down effect and multiplier effect of job losses, social benefits and opportunity costs of forgoing mining returns is huge.
“We would have expected ZCCM IH to advocate for more returns from the mining industry than issuing statements that are not aiding dialogue between government and the mining stakeholders,” he said.
He said the statement by ZCCM-IH is very unfortunate because most mines like Mopani, FQM, KCM and Luanshya mine among others have indicated that they will not retrench or downscale their activities.
“We advise ZCCM-IH to prioritize the resuscitation of Ndola Lime which falls under its portfolio instead of contradicting government’s position.”
He added, “We expect ZCCM-IH to be in the forefront of giving answers to the many questions Zambians have regarding the mines such as the cost of producing a tonne of copper, how much cobalt is being mined?, where is the gold mined going to? among others.