Wednesday, April 24, 2024

If Zambia can’t negotiate like Panama, it is better to leave the copper in the ground

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FORMER higher education minister Brian Mushimba has tweeted that if Zambia can’t negotiate better like Panama, it is better to agree to leave copper to leave the copper in the ground for future generations to come and negotiate.

Mr Mushimba was reacting to reports that Panama’s government had negotiated a better deal with Canada’s First Quantum Minerals for their minerals.

The former minister said that if Zambia can’t negotiate like Panama, despite the high demand for copper, with prices projected to soar through the roof over the next 30 to 40 yrs, the country should agree to leave the copper in the ground for the future generations to come and negotiate, before adding that instead, the country should just continue asking for hand-outs, IMF bailouts, donor funds, aid, etc.

According to the deal reached by the Panana government and First Quantum, which has still not been signed by both parties because of protection issues raised by First Quantum, Panana is expected to receive increased royalty payments for the copper mine amounting to $375 million a year. As part of that deal, First Quantum also accepted to give the government between 12% and 16% of its gross profit, which would replace the previous 2% revenue royalty. Additionally, First Quantum agreed as well to start paying 25% corporation tax, from which it was previously exempted until its investments at the mine were recovered.

However, First Quantum Minerals failed to sign the agreement with Panama’s government over its operation of the Cobre Panama mine, after the deadline of midnight on Wednesday, saying that the necessary legal protections on termination, stability and transition arrangements could not be agreed upon, prompting the Panama government to announce the closure of the mine.

President Laurentino Cortizo announced that the government ordered Frist Quantum’s local subsidiary to cease operations at the mine, the largest private investment in the history of Panama. The company says it has invested about $10 billion in the project since 1997.

President Cortizo’s Cabinet voted Thursday to order the mine to halt operations and instructed the Labor Ministry to take steps that would guarantee employment and labor protections for the mine’s workers.

The government blamed the subsidiary, Minera Panama, saying it failed to meet commitments agreed to in January for a new contract that was “reasonable and satisfactory” for the Panamanian people.

First Quantum Minerals claimed Friday that the government of Panama had cut off talks with it, resulting in the closure of a huge copper mine in a statement saying it had been negotiating with the government of Panama, which wants vastly increased royalty payments of $375 million per year from the company.

The government has said that on January 17, Minera Panama agreed in a letter to a deal with the government that included the minimum annual payment of $375 million. Despite negotiations, the company did not sign the new contract by the December 14 deadline set by the government.

First Quantum said it had agreed to those payments and the agreed-on figure would make Cobre Panama one of the highest payers of royalties and taxes amongst the large copper-producing mines in the Americas, adding that it “came very close to an agreement to secure the long-term future of the Cobre Panamá mine before the Government halted discussions.”

The company said it wanted a protection clause in case metals prices or profitability at the mine drop, presumably to reduce royalty payments in that case.

22 COMMENTS

  1. YOU WERE A MINISTER IN THE GOVERNMENT WHY YOU DID NOT NEGOTIATE? AND IF YOU THINK YOU WONT BE ARRESTED BECAUSE YOU RAN AWAY FROM ZAMBIA JUST WAIT YOU WILL BE EXTRADITED SOON.

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    • if someone is a prostitute it does not mean that they can not advise on the dangers of this business. And your threats on this highly educated individual just shows how dangerous and shallow you are.
      He has brought up a good point but all you do is degenerate into a senseless moron.

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    • Deja Vu – Brian is a highly educated fooooooool go and see the title of his PhD thesis….realy laughable…pipe down stop insulting bloggers because they have touched another of your CB mates from Mufulira.

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    • @Deja, if Brian is educated as you dream, then why can’t he get a job at First Quantum in Canada and negotiate for Zambia?

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  2. KK did this for us quietly but this crop of selfish leaders are in hurry to deplete and sell all the resources with a mentality of you only live once. Think of your children and their children.

  3. @De Javu Mr. Mushimba has a PhD from UNZA LOL which is also questionable because he got it while he was a Minister with very little time to research. Its more like a PhD that was conferred to Chagwa Lungu or Mnangagwa. Ask me which University I got my Masters. You’ll be shocked.

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  4. I can NEVER get a PhD from UNZA what is the ranking of that University in the world? UK universities don’t even recognize their Bachelor’s degree. Ati highly educated Lol

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  5. Zambia’s, or let me say Africa’s predicament isn’t in the lack of capacity to negotiate good deals but senseless greed of its leaders that leads to corruption. This cancer affects almost everyone. By our standards Brian Mushimba isn’t only sufficiently educated but well exposed as well, having lived most of his life in the US. Despite that, he was a disaster when he served as Minister at the Ministry of Transport. By now could’ve been in jail over those speed cameras. Look at how our Ministers are trying to make the KCM deal look like it’s very complicated. That’s just a ploy to prepare us for a shoddy outcome to look like a great achievement. Down South some body was hiding 000s of dollars in his sofa. Who cursed us?

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  6. Panama’s decision is an eye-opener to all of Africa. As the host nation, countries like Zambia/DRC/Mali/Burkina etc. need more from their God-given resources. LAW MAKERS…PLEASE TAKE NOTE. You need to leave a lasting legacy to mark your tenure in Parliament!

  7. If the government decided to take this advice and just let mines be closed waiting for future generations, guess who would be standing on roof tops shouting about unemployed people on the CB. Yes, Brian and his PF friends. What are the similarities and differences between our situation and panamas and how do these affect our bargaining position? You would wish to get more nuanced analysis from a former cabinet minister who happens to hold a PhD.

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  8. Mr. Brian, your analysis or understanding on the issue at hand is shallow to say the least. Panama is the ship gateway that connects Asia and North AMERICA, which simply tells you that panama has an upper hand when negotiating with mine company. The well developed transport system means that exporting the minerals is cheap when compared to Zambia, ( tools for negotiating).

  9. Brian Mushimba is one useless goat when he was in govt he was quiet its laughable that he is talking about good negotiationg skills of another country when he gave $30m to Ethophian Airlines to paints its grounded unused aircraft with Zambian Airlines branding. This is the same goat that flipped a GRZ Ministrial vehicle in the early hours bruised his arm ran away to SA so he was not breathised then admitted himself in a private clinic for 4 weeks where the bill was footed by the Zambiuan taxpayer.

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    • 8# You’re mistaken, Brian Mushimba wasn’t that quiet. He was busy cutting deals with bena Amos Chanda and Zindaba Soko. He’s the one that introduced Chitotela to Walid the Lebanese who brought in those speed cameras without any invoice or customs clearance. In one of his testimonies, Walid said that the guys went to him and demanded US$250,000 to facilitate phase 2 of the deal. This was the time penalty fees were being deposited in a private account. And when Walid refused to give them more money his contract was terminated for lack of capacity to perform! I hope that Musa Mwenye and Shamakamba won’t forget this

  10. Don’t expect anything positive from the new doom government…They love money to a point of selling Zambia… Privatization spirit is here…

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  11. I don’t see why his education has become an issue instead of what he says.
    Why do Africans behave like that.. I remember when a graduate from ZIT was promoted to Senior Mine Engineer, the Unza guys went to the HR offices to protest….yet the guy was miles ahead of them in performance.
    I know Brian as a stable person…he was classmates with one of my children.

    He may have changed. I don’t know.

    • ” And your threats on this highly educated individual just shows how dangerous and shallow you are.”

      And you ask why his education has become an issue when you just posted this…really laughable…maybe you are losing your memory!!

  12. Keyboard warriors, good for nothing bunch except shooting their fellow humans down, here attempting to rewrite history about a man they don’t even know. Just because they saw him serve in a govt they might not have liked, then they want to paint with such a broad brush it’s laughable. Brian has several engineering degrees and only one from Zambian, how many do u have? Brian worked was an executive director at Eskom before he joined politics, where do u work? Brian now is back in the private sector as an executive director in a Canadian energy firm, what are u? U will never be half the man brian is. Choke on that. The perchance to debate the person and not the ideas among zambians is why we are poor. Umulomo.

  13. Peter Haimbe:

    Can’t have said it better myself. Debating the individual instead of the idea=Poverty Mentality

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