By Dr. Chris Patricks
Three years after losing control of Konkola Copper mines (KCM), Indian investor Vedanta Resources Ltd is attempting to force the new Zambian government to hand back the mining asset through stage managed public opinion even though the matter is due for arbitration in January 2023.
KCM was placed under provisional liquidation in 2019 after the previous Zambian government alleged that the company had lied about expansion plans and paid too little tax. KCM denied any wrongdoing.
The company has been making offers with sweeteners to compel the new government to revert ownership of the mining giant to them
Vedanta in December 2021 offered that it was ready to invest about $1.5 billion in reviving KCM and making it a world-class asset, while warning that the mothballed operations are on the verge of collapse. They also offered to pay suppliers outstanding invoices and also make a one off payment of K2,500 to each employee across the board. However, the company’s history on being economical with truth on promised investments did not inspire confidence and government looked at the offer with a pinch of salt.
That not with standing the government in an act of utmost good faith, earlier this year, agreed to end legal action against billionaire Anil Agarwal’s Vedanta. As President Hakainde Hichilema sought to revive mining output in the southern African country which is seeking to attract investment to one of the world’s biggest copper producers by repairing damaged relationships with mining companies inherited from the previous government.
Though January 7, 2023 was set as date for arbitration, a few months ago the mining towns of Chingola and Chililabmbwe experienced peaceful demonstrations by supposed unemployed youths demanding that government hand back the mine to Vedanta, arguing that the investor’s return would reduce chronic unemployment and revamp the local economy.
The organized, articulate and clearly well fed youths made it seem like without Vedanta it was all doom and gloom for residents of the two towns. No doubt, these were not spontaneous but concerted demonstrations funded by the investor.
The first protest seemingly having not yielded the desired effect Vedanta have now turned to the local church leadership, in this deeply religious country, which was declared a Christian nation in 1991.
This week, a sizeable delegation of preachers travelled to the capital Lusaka and held a press conference echoing earlier protesters calls for the mine to be handed back citing the unbearable suffering of local communities. In essence, this was a little more than a rented mob whose transport, room, board and allowances had beer taken care of by Vedanta.
Surprisingly, the churchmen and women had chosen to travel to Lusaka to air their concerns when the area Member of Parliament for one of the effected towns, Chililabombwe, is mines minister Paul Kabuswe. Instead of engaging the minster on their own turf, the members of the clergy saw it fit to put government on the spot in an attempt to embarrass government into handing the mine back to Vedanta.
They also cast aspersions on the ruling UPND’s sincerity on pledges made to create and sustain employment while they where in opposition.
The new government acknowledges that any solution at KCM has to include Vedanta, which remains a 80%-shareholder in the operation with the government’s Zambia Consolidated Copper Mines Investment holdings holding the other 20%.
Rebooting production at KCM is central to Zambia’s ambitions to raise annual copper output to about 3 million tons by the end of the decade, from about 800,000 currently.
President Hichilema has said his government will seek to end “excessive litigation” in mining after former President Edgar Lungu’s administration took an increasingly aggressive stance with the industry.
The president’s investment drive received a boost in August after First Quantum Minerals Ltd lunched a $1.25 billion project to expand its Kansanshi copper mine in North Western Province.
Clearly, the Zambian government is determined to follow the due process of the law but the investor is in a hurry to reclaim the asset which they abused over the years by creating a false crisis through paid agents.
Dr. Chris Patricks is Associate Professor in the Department of Political Sciences and Director of the Centre for Mediation in Africa. He also publishes on multilingualism in higher education and journalism studies. He is a former award-winning journalist._
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