HICHILEMA MUST REVISIT MINING CONCESSIONS
The solutions to Zambia’s problems lie within the framework and borders of this country, and we have regularly illustrated how this can be done.
We have on several occasions advised Mr Hakainde Hichilema and the UPND government on the urgent need for them to pay a lot of attention to the taxation of our mines. Clearly, we are losing out so much, and it’s sad to watch. We definitely need to get our act together and get fair taxes from our minerals.
There was absolutely no need for Mr Hichilema and the UPND government to be in a rush to give away our minerals to foreign transnational mining corporations for next to nothing. All these mining firms like Anglo American, Anglovaal, Glencore, Vendanta and other mining corporations are interested in our minerals because there are huge profits to be made now, and in the future.
Yet when we advise Mr Hichilema and his league to revisit the mining concessions and tax waivers to improve dollar inflows to the treasury, and the economy at large, they never take our advice or act on it. They know it all and continue to pursue impractical and irresponsible policies.
But here is the reality:
Do you know that US$2 billion of tax waivers per annum can employ 3 million farm workers? This is the reality on the issue of tax incentives. Do you also know that it takes 180 pounds of copper to make a Tesla or other electric vehicle? This is five times the amount of copper needed to make a combustion engine motor vehicle. And it takes 450 pounds of copper to build a normal house, once you include electric appliances, wiring and fixtures. If you put solar panels on it that will take another 100 to 150 pounds of copper wiring. A solar farm used to generate energy requires five times the copper it takes for an equivalent natural, coal, or nuclear power plant.
Truth is, if we are going to turn our cars into electric vehicles, we are going to need a lot more copper over the next ten years. If we are going to build houses for all the millennials – the largest generation on the planet – we are also going to need a lot more copper. If renewables, such as wind and solar power, are used to build those things and supply energy then we will still need a lot more copper.
Under these circumstances, it does not and will never make sense to give tax breaks and other unnecessary incentives to transnational mining corporations. Yet we want to be visiting Western capitals with a begging bowl for help as though we can’t think, plan and see. Why would we do that? The UPND has certainly not acted wisely on this matter. And we can think of no reason why a government would do this, unless it was acting out of ignorance or corruption, or both.
But by so doing, Mr Hichilema and the UPND government are depriving Zambians to improve their well being; through the provision of improved salaries, infrastructure, social amenities, education, health and so on and so forth.
We again ask Mr Hichilema to heed our call, and act on these solutions with immediacy.
Dr Fred M’membe
President of Socialist Party
You are back to your hopeless default settings. Which mine can pay you US$2billion in a year here in Zambia. Since when has our mines paid such an amount of tax in one fiscal year to the treasury. And which concessions are you saying should be removed. You are a so called presidential candidate of your kantemba party but your hallucinations are merely rubble rousing than being meaningful. Talk in specific terms may be some gullible like Hindigol will hear you. Do even know the aggregate turnover of the Zambian mines per annum?
The opposition leaders we have currently are jokers. Clearly Mr. Mmembe doesn’t understand what he is talking about. For his information, the only incentive in the mining sector currently is MRT which has been made deductible for a good reason but even if it was to be restored, the highest we can realise from this is only $500 million per annum not $2 billion Mr. Mmembe is claiming we would realise. The man does not seem to realise that it’s because of the same incentive that we have seen some recovery of the sector in recent years which was dying during the PF administration. We have to realise that focusing on short term gain of the same MRT will be at the expense of long term gain we have started seeing and will cost the country long term investment prospects in the sector. People need to understand that one can’t milk their cow to death just because they pressure to sort out at that moment, they end up with no milk in the future because the cow dies as a result. But the unfortunate part is that we have people who believe such rhetoric even though it does not make any economic or business sense. Such kind of thinking by Mr. Mmembe is what almost killed the mining sector in the PF administration of which we have not fully recovered.