MUSOKOTWANE MISGUIDED THE NATION, CF SLAMS SUSPENSION OF EXPORT DUTY ON PRECIOUS STONES AND METALS
LUSAKA, February 19 – Yesterday, the Ministry of Finance and National Planning issued a statement on the Suspension of Export Duty on Precious Gemstones and Metal.
As Citizens First, our view is that the Minister misguided the country by framing the suspension of export duty as a boost for investment and economic activity in mining.
In reality, this decision may have the opposite effect, undermining both the nation’s economic interests and the long-term sustainability of the mining industry in our country.
Precious stones and metals are high-value, low-volume commodities, making them highly liquid and easily tradable on international markets. By removing export duty on these commodities, the government is carelessly creating an environment where traders—not genuine investors—stand to benefit the most. Without satisfactory taxation, Zambia risks becoming merely a source of raw materials, with no mechanisms to encourage value addition or reinvestment into the sector.
This development will, in turn, discourage legitimate mineral exploration and long-term mining investments that could have significantly contributed to the country’s economic wealth.
This government must ensure that all minerals, including precious metals and gemstones, benefit its citizens.
We urge President Hakainde Hichilema and his government to prioritize local interests in resource exploitation. Allowing foreign entities to extract and export resources without paying any duty or contributing revenue to the state, will only deepen economic woes.
The Zambian people will continue to face high living costs, while investors and traders amass significant wealth with little accountability.
Economic and Revenue Implications
The purpose of export duties on precious metals and gemstones is to:
1. Regulate trade – Prevent uncontrolled exportation of national wealth.
2. Generate revenue – Ensure that the government collects funds that can be reinvested into public services, infrastructure, and social programs.
3. Control the export of sovereign wealth reserves – Particularly for commodities such as gold, which play a critical role in national financial stability.
However, with this suspension, the government is surrendering control over the trade of Zambia’s most valuable resources.
The Zambia Revenue Authority (ZRA) will lose a critical revenue stream, funds that should be used to improve the welfare of Zambian citizens.
We are more concerned that, this move discourages domestic processing industries, which could have created jobs and contributed to economic diversification.
We are also alarmed that the consequence of this decision is the likelihood of increased illegal mining and smuggling. With no duty imposed on exports, there will be no effective way to measure production volumes, making it easier for foreigners to exploit and export minerals without any viable oversight.
Citizens First recommend the following in order to maximize the benefits for the people of Zambia:
• Export duties should remain in place for precious gemstones and metals to regulate trade and ensure the government collects its fair share of revenue.
• Tax incentives should be targeted at exploration companies, as they undertake high-risk investments that contribute to long-term sustainability of the mining industry.
• Producing mining companies, which already generate significant profits, should continue paying taxes, as enshrined in Zambia’s laws that recognize minerals as a national asset for the benefit of all citizens.
• The government should adopt a balanced fiscal regime that promotes investment in exploration while ensuring that producing companies contribute fairly to the economy.
In case Dr. Musokotwane doesn’t know, the suspension of export duty on precious metals and gemstones does not promote sustainable investment. Instead, it opens the door to unregulated trade, revenue loss, and increased smuggling—leaving Zambia with little to show for its rich natural resources. The government must urgently reconsider this policy and implement a framework that safeguards national wealth, promotes domestic industrial growth, and ensures that Zambia’s minerals benefit its citizens rather than foreign traders and speculators.
Issued By:
Harry Kalaba
Citizens First President