The Trouble With Oliver Saasa’s Report
By Amb. Emmanuel Mwamba
The report recently done by Prof. Oliver Saasa and Shebo Nalishebo entitled ‘Evaluation of Economic Impact of Planned First Quantum Minerals Investments in Zambia’, takes a wide-angled view to examine the macro-economic effects of two of First Quantum Minerals’ (FQM’s) newly-announced investments: a $1.25 billion investment into the expansion of Kansanshi mine’s operations, and a $100 million investment to bring the miner’s $250 million Enterprise nickel project online in Kalumbila.
FQM runs Kansanshi Copper Mine in Solwezi and Kalumbila( Sentinel Copper Mine) in Kalumbila District.
Reading the Report, gives you an impression that this is material for public relations and not an analytical and independent evaluation of the planned investment.
I think this is so because this was commissioned by First Quantum Minerals!
Look at previous good, objective and fair analytical reports that have been done on the issue.
“For Whom the Wind falls-Winners and Losers in the Privatisation of Zambia’s Copper Mine” is a good example.
This Report examined in a wholesome manner the lack of adequate regulation, the unfair and exploitative Mining Agreements, the pension poverty, the casualisation of workers, the exploitative, the lack of both business and social benefits to the community and local economy.
The report also revealed deep-seated fraudulent tax schemes that mine houses engage in, the unnecessary expatriate staff and new money and new profits for the owners.
But Prof. Saasa’s Report discusses no negatives or critical matter but hypes up the proposed investment and benefits that will allegedly accrue to government and the community.
FQM intends to embark on two projects; Kansanshi Expansion Project and Kansanshi Nickel Project.
Kansanshi Expansion Project is designed to extend the life of the mine and boost production from 200,000 tonnes per year to 335,000 tonnes.
The project will also increase Gold production from the current 125,000 ounces a year to 160,000 by 2030.
On the other hand, the Enterprise Nickle Project is projected to produce 36,000 metric tonnes of nickel per year.
The report sends the reader in wild speculation on how this investment, largely capital investment in machinery and equipment will yield community benefits in job creation of about 500-800 and “multiplier effect” that may benefit upto 10,000 people.
FQM prides itself as the largest single tax payer in the country and says it contributed $1.258 billion in public ontributions in 2021.
This amount is made up of taxes ($368m in income taxes) royalties ($386m), duties and fees paid to national and local government, dividends to ZCCM-IH as well as the company’s social and infrastructure expenditure in North-Western Province.
Prof. Oliver Saasa’s Report also raised issues of Conflict of Interest as he was announced as leading an economic advisory unit to President Hakainde Hichilema.
On 15th December 2021 President Hakainde Hichilema announced that he had appointed renowned economist and commentator, Prof. Oliver Saasa as new Chairperson of a new advisory council.
“As part of our vision for growth in Zambia we have asked the eminent Professor Oliver Saasa to chair a New Advisory Council, which will help us to systematically break down the barriers to doing business in our country.” President Hichilema announced.
But in his letter responding to charges of conflict of interest to the Transparency International-Zambia, Prof. Saasa says such a Council doesn’t exist and he has not been appointed to any economic or government unit.
He also said he is not aware of any person appointed to such a steering committee.
This debacle exposes State House as President Hichilema appointed and announced a Chairperson to a non-existent entity as seen by the details of Prof Saasa’s robust response. This has made the Advisory Council a fictitious creation.
On Mining, clearly the current model doesn’t benefit Zambia, as the country benefits little or nothing from such an important sector. Even the numbers announced by FQM may need lose scrutiny.
We require a more fundamental, more beneficial or deeper policy on mining.
