By Kellys Kaunda
WOULD YOU SUPPORT THE NATIONALIZATION OF OUR MINES TO MAXIMIZE BENEFITS FOR THE COUNTRY?
This is the call being made by Dr. Mbita Chitala according to the Daily Nation today.
This way, Dr. Chitala argues, Zambia gets to keep all the copper receipts thus increasing funds that could be applied to national development.
A second benefit, he further argues, is that illicit outflows of profits are prevented.
First, there are countries around the world with various degrees of state ownership of enterprises engaged in their respective natural resources.
Saudi Arabia and Venezuela own between 60% to 100%, respectively, of their oil companies.
Brazil owns Petrobras. Mexico owns 100% of its oil company while Finland owns between 20% to 56% of the oil and gas sectors.
Some estimates suggest Angola has a 20% stake in the oil sector while Chile owns 100% of the copper mines.
Through ZCCM-IH, the Zambian Government owns shares in the various mines in the country to varying degrees.
The reason Dr. Chitala’s proposal is worth discussing is because (1) the mines constitute the bedrock of our economy earning the country most of the forex, and (2), there are reports suggesting very strongly that the current majority shareholders are not paying fair taxes due to various sophisticated schemes that the Zambian government has no capacity to uncover.
One example is where one figure is declared to the authorities here as the revenue while the country to which the minerals were exported are reporting a much higher figure!
These irregularities have been reported too many times by other African countries as well, we can’t keep on ignoring them.
Credible institutions continue to report the loss of billions and billions of dollars stolen out of Africa by investors.
These are billions that have the potential to lift the continent out of the current trap of poverty.
But the west wants us to think we can’t run the mines and we can’t raise capital.
But the manpower investors use is local and the money they use is borrowed against our assets on the capital markets available to every one.
If the west can pump billions in our economies as development assistance, why won’t they partner with us as equals in business ventures related to our mineral resources?
As we debate this question, let’s take into account one suggestion the President made at one time which to me sounded like a viable proposition – to have a stake at every stage of the value chain from production to the sale of our minerals.
This should be able to significantly increase our share of the profits even at the current level of shareholding that we have in various mine ventures.
Stupid thinking, they failed to perform, now they’re performing (mines), you want to destroy them again, what kind of people are these
We have been through this road before and it does not work so stop taking us backward Derrick chikala.
Ba Chitala is frozen in the past. When we nationalised the copper mines, production went down from a peak of 850,000 tonnes per year to 250,000 tonnes at the time of privatisation.
What caused this decline? Political interference. Can our copper mines operate without political interference? Highly unlikely. Just look at the performance of our parastal companies. Zamtel, Zesco, Zisc, et al.
Zesco was grossly abused by the last regime (PF). It was their cash cow and it was used to employ cadres and spouses of PF officials. Maybe the model we should be talking about is CEC, a successful Zambian private company which is professionally managed.
Or the State can have a 40-49% share. Definitely not 100%. We have been there before and the result was not pleasant.
What does Dr. Chitala do for a living? If I recall correctly, he was board chairman when Zesco went rogue during PF rule. And he wants us to grab the mines so he can mess them up?
There is no dununa reverse this time, nationalization of mines lamentably failed. Instead of maximizing profits, it greatly minimized them and promoted corruption. When mines are in our hands, many Zambians start thinking that mines depend on them forgetting that it’s them who depend on mines.