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Government should get 50% stake in KCM and impose more controls on Vedanta

Political and Socio Anthropologist James Musonda has said that intentions to have the Konkola Copper Mines (KCM) liquidation case withdrawn from the court will amount to nothing if the government does not get 50 per cent shares in KCM and impose more controls on Vedanta.

In July this year, mines minister Paul Kabuswe directed the Zambia Consolidated Copper Mines Investment Holdings through its lawyers to quickly dialogue issues surrounding KCM and Vedanta Mineral Resources outside court because the government cannot wait for January 2023 for the next court case to be dealt with as this requires urgent attention.

In an interview with the local radio station Radio Phoenix, Dr Musonda charged that the return of Vedanta to Zambia is certain but notes that if Vedanta comes in the same destructive form it is known the world over; the liquidation will amount to nothing.

He has reminded the government to be alert in the way it is handling the KCM matter as Zambians are monitoring every move being made regarding this issue.

Earlier in the year Mr Kabuswe is on record for saying that Zambia needs to hold a bigger stake in new mines and local communities should benefit more from the mineral values chain.

“This government is saying Zambians must be an integral part of whatever investment. We can no longer sit on the terraces and watch,” Kabuswe said at a mining conference in June.

The minister said later in response to questions that the government was planning to increase the state’s shareholding in new mines to ensure that Zambia maximises its benefits from the sector.

“Going forward, I don’t think there will be a mine where Zambia will own less than 20% (of shares). Those days of 10% shareholdings are gone,” Kabuswe said.

Kabuswe said the government needed to have a golden share in new mines, which would give it controlling voting rights.

Zambia’s mining investment arm ZCCM-IH holds less than 50% shares in key mining operations and a 20% stake in Kansanshi mine which is majority owned by Canada’s First Quantum Minerals.

Last week, Mr Kabuswe announced that the court cases between Vedanta Resources Holdings Limited and ZCCM – Investment Holdings (ZCCM-IH) have finally been suspended to pave way for dialogue.

Vedanta Resources, which has an 80 percent stake in Konkola Copper Mines (KCM), has been embroiled in a long legal battle with ZCCM – IH, the minority shareholder, over the appointment of a provisional liquidator to run the operations of the mine.

In 2019, the Zambian Government, through ZCCM-IH placed KCM under the provisional liquidator, citing poor management of the mine by Vedanta, charges which management at Vedanta disagreed with.

Mr. Kabuswe is confident the issues surrounding KCM will be resolved now that the court cases have been suspended.

Copper production in the first half of 2022 dropped by seven percent to hit 364,937.58 metric tonnes, from 394,183.92 metric tonnes recorded in the same period last year.

Meanwhile, The government has said that it is in the process of formalizing all illegal mines countrywide in order to address the problem of illegal mining.

Mines and Minerals Development Minister Paul Kabuswe has noted with concern the increasing cases of illegal mining involving mostly small-scale and artisanal miners.

Mr. Kabuswe has advised the youth engaged in illegal mining activities to register their businesses and benefit from the many empowerment programmes being implemented by the new dawn administration.

The Minister was speaking in Kabwe during the commissioning of the rehabilitation of the Kabwe main canal aimed at addressing the health challenges caused by lead poisoning.
And Central Province Minister Credo Nanjuwa has warned individuals and some young people engaging in illegal mining activities in the name of the UPND and President Hakainde Hichilema to desist or risk facing the wrath of the law.