3.1 percent mineral royalty from Kansanshi mine inadequate – Christopher Kang’ombe

Patriotic Front Kamfinsa Member of Parliament Christopher Kang’ombe says the Zambian government should not surrender their 20 percent shares in Kansanshi mine, and they should not agree on getting a 3.1 percent mineral royalty payment as it is an inadequate percentage with a limited impact on the economy.

Mr Kang’ombe disclosed that if the government is saying they will no longer be claiming dividends from Kansanshi mine but they would rather be getting 3.1 mineral royalty, then the government through ZCCM-IH should have come out in the public to state that they are having problems of getting dividends from Kasanshi mine and that they are proposing a royal system where they claim a royalty of 3.1 percent, adding that the government should have negotiated for a much higer percentage such as a 10 percent royalty instead of a 3.1 percent royalty as this will enable even the Ministry of Finance and National Planning to fund all those gaps that they claim to have in the budget.

“We are dealing with an issue to do with mining taxation, where we need to look at things such as the formula which will give the Zambian government and people more revenue, we don’t have to just fold our arms and say the best we could get out of Kansanshi mine is 3.1 percent mineral royalty or we tell the government that the 3.1 percent is not adequate as this will be my argument in Parliament that if ZCCM-IH has failed to get a good deal out of the Kasanshi mine, then they should let us assemble a different team or they should tell us what they think should be done to get a better deal out of Kasanshi mine,” he said

He has since urged President Hakainde Hichilema to engage ZCCM as to whether the 3.1 percent is the best that can be acquired out of Kansanshi mine, and if they could negotiate for more and also compare with other countries where a royalty is paid as opposed to a dividend as the mines manipulate figures by stating that they did not make profits.

Mr Kang’ombe explained that there are two shareholders in Kansanshi mine, ZCCM-IH which looks after the interest of the Zambian government in all the mines where they own 20 percent shares and First Quantum Minerals – FQM owns 80 percent, adding that about three years ago, FQM attempted to buy the 20 percent shares where they offered the government by stating that they are having challenges dealing with how much they should be paying the government for the profits they make as a business, hence, ZCCM-IH took FQM to court with the complaint that the mining investor are not paying them dividends which are share of the profit, and FQM has not been paying the right amount of dividends to ZCCM.

He further explained that the Zambian government rejected the proposal to sell their shares to FQM through ZCCM.
Mr Kang’ombe stated in an interview on Millennium TV that ZCCM is holding the shares in Kansanshi on behalf of the Zambian people and whatever money comes out of Kasanshi should be able to do certain activities in the economy.

“There are indirect benefits from the mine such as job creation, but at the end of the day Zambian government needs money in the budget that will enable them to provide health care and many other things that are needed,” he said

Meanwhile, Mr Kang’ombe disclosed the that there are a number of challenges such as the late delivery of farming inputs in the rural part of the constituency, water problems because of old infrastructure as he hopes that in the coming year the projects that started and where stopped because of inadequate funding, will be resumed, high cost of living and high fuel prices and its impact on the businesses.

“Under the Constituency Development Fund – CDF projects, we have embarked on a water project in a area called Zamtan that used to be an unplanned settlement which has been upgraded, and industrial boreholes will be put up, the water project will also be piloted in an area called Ndeke village by helping Nkana Water to replace some water pipes which will enable people in the area to have access to water,” he said

“A bridge that will connect Mulenga compound and Ndeke will be constructed, this commitment has already been made and money has been paid as works on the bridge are scheduled to start before the end of this year,” he added

Mr Kang’ombe mentioned that he has advised the Ministry of Local Government and Rural Development to quickly amend the CDF Act where the this law will be changed and structured in a way that they do away with some stages that lead to the delays of having the projects moving.

Mr Kang’ombe stated that all the 2021 CDF projects are under implementation and the 2022 CDF projects for the first and second quarter are also under implementation, as they are now looking at the third and fourth quarter as they are hoping for the funds to be released on time to avoid further delays next year.