Hakainde Hichilema and the UPND: Zambia’s worst economic and political nightmare!
By Azwell Banda
It has been caused to be leaked the
obnoxious, abhorrent and humiliatingly repugnant conditions Vedanta are
demanding from government for them to return to Konkola Copper Mines (KCM).
HH and his friends are secretly, unconstitutionally and illegally, out of court, making deals over KCM. The scandalously pathetic ZCCM-IH and FQM Royalty deal proves beyond reasonable doubt that HH and the UPND are Zambia’s worst economic and national security nightmare.
HH and the UPND are stripping Zambia naked, economically, and exposing the country to extreme security risks. They must be stopped, before it is too late.
It is not as if we were not warned about this nightmare, we were warned: including by Hakainde Hichilema himself. On 18 January, 2019, appearing on Radio Christian Voice “Chat Back” programme, unprovoked by the interviewer, Hakainde Hichilema volunteered this information: “The mining companies are saying ‘HH, we are waiting for you to come into power. We will pay the tax which you will introduce because we know it is a fair tax’”.
One year and four months after HH and his UPND support choir have formed government, this nightmare and more are happening!
HH could not contain himself but reveal the fact that in the fight and war between rapacious, oppressive, mean, polluting and environment damaging and exploitative foreign mining companies and poor Zambians, he was firmly in the trenches with foreign mining companies. HH is parasitic on, and beholden to, foreign mining companies. We have since come to learn how such mining capital supported and sustained his political campaigns to become President of Zambia, among other things, by over demonising his main political opponent Edgar Chagwa Lungu by portraying him as thoroughly corrupt, incompetent, and a thief.
Of course, Edgar Lungu and the PF did not need foreign money to have their corrupt and rotten ways broadcast in Zambia: Lungu himself is on record lamenting the extreme corruption of his government. It is the sophisticated use of modern media tools by private foreign commercial media organisations in our politics, in pursuit of the rapacious, oppressive and exploitative foreign mining interests that must worry Zambians. The past 14 months have seen nothing short of an actual “payback time” for foreign mining interests in Zambia, complete with the criminal gift of withdrawal of criminal charges before our courts, for directors of FQM, while they walk away with 100 per cent shareholding value!
Hakainde Hichilema made the shocking revelations about his relationship with foreign mining money when he was asked to respond to the PF 2019 national budget and its mining proposals. Margaret Mwanakatwe, then PF government minister of finance, had announced a 1.5 per cent increase in mineral loyalty tax rate, five per cent import duty on copper concentrates, 15 per cent export duty on precious metals, and abolition of Value Added Tax and its replacement with a non-refundable Sales Tax. As expected, mining companies responded by issuing threats to cut back on capital investments, scale back on some operations, lay off workers and focus mining on the highest grades of ore available, among other restrictive retaliatory measures.
This classic blackmail from foreign mining companies to withhold investments and literally reduce operations to barely break-even at the mere suggestion by a poor, overindebted government to earn its fair share of revenues provides the best evidence and proof of the primitive idiocy of privatising any strategic sector of a national economy. Such sectors are at the core of national security.
In a country whose economy is anchored on, overdependent, on copper mining such as Zambia is, our national security and sovereignty are inseparable from state ownership and control of our minerals and mines.
Hakainde Hichilema in the interview with Radio Christian Voice in January 2019 arrogantly warned Zambians that should he be elected President, he would preside over the complete erosion of control Zambians had on its minerals and mines, by siding with foreign mining companies in the fight between Zambia and foreign money in mining. Today, 14 months after being elected into government, HH has and is doing just that!
The arguments that mines conceal their production, sells, and profit data, and rarely declare dividends, and that even if profits are declared, minority shareholding deprives Zambia of the necessary vote to cause dividends to be frequently declared so that this stream of revenues may regularly accrue to Zambia, and therefore to guarantee that Zambia “at least receives some money” from mining companies we must swap the little shareholding value we have with an insult of “loyalty tax”, is the most unscrupulous betrayal of the people of Zambia. It is economic treason in a country whose economic mainstay is mining.
Further, this simply confirms the lunacy of allowing foreign companies to own and control copper mining in Zambia: Zambia is reduced to begging for “something” out of the massive profits foreign companies make from our minerals. There is no alternative to nationalised strategic economic pillars of any national economy, whatever weaknesses and challenges in managing such national sectors there may be.
The secret, unconstitutional, criminal out of court deals HH, his close personal friends and his ministers are making with foreign mining companies reminds me, very sharply, what Dr Sishuwa Sishuwa wrote about Hakainde Hichilema, soon after Hakainde’s interview with Radio Christian Voice, in January, 2019. Dr Sishuwa’s article is freely available on the internet. It is wrongly titled “Is Hichilema a lapdog of Zambia’s mining companies?” It is a wrong title because the mines in question are not Zambian mines, they are foreign owned mines in Zambia!
Dr Sishuwa’s article is essential reading for all Zambians who care to understand everything that is going on today in copper mining in Zambia under HH, and especially those who may wish to do something to prevent the total loss of Zambia’s ownership and control of our minerals and mining.
The sooner Zambians wake up to the realities Dr Sishuwa raises in his article, the better for Zambia.
The alternative is simply a worsening of our national hunger, poverty, unemployment and extreme inequalities as foreign mining companies ship out of Zambia millions of tonnes of our copper to enrich their foreign and very few Zambian shareholders at the expense of Zambia.
Dr Sishuwa says the following in his article: “The truth is that the benefit of keeping minerals in the ground, or banking them for the future, far exceeds the economic, environmental and social costs of a bad deal. So, if mining companies threaten to leave because of the proposed small tax increments, Zambia would do well to pave the road for them. It is time we looked to longer term strategies rather than short term expediency. Banking our resources until such a time that we are in a strong negotiating position or there is broader scarcity for metals that would enable us set improved terms for ourselves is better than emptying our underground wealth to mostly benefit foreign commercial interests.”
Fundamentally, Dr Sishuwa says: “One of the major downsides of the current extractive industry ownership structure is that it is made for corruption and for as long as the State does not have a decisive ownership stake in the strategic mining industry, (i.e. more than 50 per cent as is in countries like Botswana, Norway, Sweden, China, etc) Zambians will also have limited means to public accountability for stolen resources. This is because a limited ownership structure (even with greater taxation) gives leverage for the majority shareholders to hide profits and obscure minority shareholders. In effect, accountability is increased where a publicly owned enterprise exists.”
Hakainde Hichilema and his friends want to raise copper output to three million tonnes, annually, meanwhile, they understand very well that very little of this value will accrue to Zambia. Why? What is in it personally for HH and his close friends? Unravelling this will explain the underlying motives for this extraordinary plunder of our natural resources, and national betrayal.
Between 1972 and 1992, all the chaos, inconsistencies, incompetence, patronage, nepotism, corruption, wastage, low mine wages of Zambians, strikes on the Copperbelt, and political pilfering of money from the mines during the time when they were “nationalised” pale into insignificance compared with the loss of value and damage to our economic sovereignty Zambia has suffered between 1992 to November 2022. Hakainde Hichilema is poised to erode the little economic sovereignty Zambia still has left in copper mining through his secret deals with foreign mining companies. What is in it for him?
(Comments to: banda.azwell@gmail.com)
