Global Witness paints dark picture of FQM Zambia influence
… Chelwa says investigation raises troubling questions over tax policy and state capture
By EMV REPORTER
Chair of the Social Sciences Department at The Africa Institute, Dr Grieve Chelwa says the Global Witness report raises serious allegations that Canadian mining company First Quantum Minerals (FQM) has exerted significant influence over Zambia’s democratic institutions and policymaking processes.
Dr Chelwa has since urged Zambians to read the report by Global Witness.
In a statement, Dr Chelwa said the report presents extensive evidence that Zambia has over the past two decades and particularly since 2021, ceded substantial economic sovereignty to foreign capital interests and their local associates with the mining sector benefiting from generous tax concessions.
“Mwebena Zambia, please spare an hour this week to read this investigative report published today by Global Witness on how the Canadian mining concern, First Quantum Minerals, has captured our democracy and our policymaking process,” Dr Chelwa said.
He said the report painted a dark picture of the relationship between the mining giant and the country’s policymaking process, adding that it alleges the mining sector has benefited from tax concessions exceeding US$1 billion since 2022.
“All this has been done to the benefit of FQM and the larger mining sector, which the report argues have enjoyed tax concessions in excess of a billion dollars since 2022,” he said.
Dr Chelwa also referred to a recent policy brief he co-authored with Ntazana Kaulule, saying data drawn from the Ministry of Finance’s tax expenditure reports showed a sharp decline in Mining Company Income Tax collections following changes to the fiscal regime introduced in 2022.
He said the data indicated that in 2021, mining companies and ordinary workers contributed roughly similar amounts to the Treasury, but that the trend changed significantly thereafter.
“By 2024, workers were contributing US$891 million in PAYE against a mere US$277 million from the mining companies, more than three times as much, in a year of historically high copper prices. A complete scandal, now validated by this new investigative report from Global Witness,” Dr Chelwa said.
The Global Witness report alleges that tax policy changes introduced after 2021 significantly reduced the mining sector’s tax burden while preserving favourable conditions for major mining investors.