Zambia cabinet gives nod to mineral investment and trading unit
Lusaka seeks to negotiate bigger stakes in new mining projects
12 June 2024 - 19:01
byChris Mfula
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Lusaka — Zambia would set up a new entity for investment and trading in minerals as it sought to earn more from its natural resources, the cabinet said on Wednesday after giving its approval to the plan.
The Zambian government, which owns several mining assets through ZCCM-IH Investment Holdings, will establish a special purpose vehicle (SPV) for investment and trading purposes, it said. Zambia is Africa’s second-largest copper producer.
The Industrial Development Corporation has a 60.30% shareholding in ZCCM-IH.
The new entity would help Zambia “move away from the dividend payment model for mineral resources and adopt a production-based sharing mechanism to ensure benefits accrue to the people of Zambia beyond statutory obligations”, the cabinet said.
The new business model would allow for sharing of minerals produced, as well as enable the government to negotiate mineral prices and ensure the correct declaration of mineral consignments designated for export and domestic use, it said.
ZCCM-IH. has interests ranging between 10% and 20% in mines including those owned by Barrick Gold, Vedanta Resources and First Quantum Minerals.
It recently sold a 51% stake in Mopani Copper Mines to a unit of United Arab Emirates’ International Holding Company, retaining the remainder.
In February, mines minister Paul Kabuswe said Zambia planned to negotiate larger holdings in new mining projects as it seeks to raise its revenue and boost spending by investors on social projects.
The country, which produced 698,000 tonnes of copper in 2023, down from 763,000 tonnes the previous year, is targeting 3-million tonnes in annual output within the next decade as demand for the metal used in the electricity and construction industries rises.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Zambia cabinet gives nod to mineral investment and trading unit
Lusaka seeks to negotiate bigger stakes in new mining projects
Lusaka — Zambia would set up a new entity for investment and trading in minerals as it sought to earn more from its natural resources, the cabinet said on Wednesday after giving its approval to the plan.
The Zambian government, which owns several mining assets through ZCCM-IH Investment Holdings, will establish a special purpose vehicle (SPV) for investment and trading purposes, it said. Zambia is Africa’s second-largest copper producer.
The Industrial Development Corporation has a 60.30% shareholding in ZCCM-IH.
The new entity would help Zambia “move away from the dividend payment model for mineral resources and adopt a production-based sharing mechanism to ensure benefits accrue to the people of Zambia beyond statutory obligations”, the cabinet said.
The new business model would allow for sharing of minerals produced, as well as enable the government to negotiate mineral prices and ensure the correct declaration of mineral consignments designated for export and domestic use, it said.
ZCCM-IH. has interests ranging between 10% and 20% in mines including those owned by Barrick Gold, Vedanta Resources and First Quantum Minerals.
It recently sold a 51% stake in Mopani Copper Mines to a unit of United Arab Emirates’ International Holding Company, retaining the remainder.
In February, mines minister Paul Kabuswe said Zambia planned to negotiate larger holdings in new mining projects as it seeks to raise its revenue and boost spending by investors on social projects.
The country, which produced 698,000 tonnes of copper in 2023, down from 763,000 tonnes the previous year, is targeting 3-million tonnes in annual output within the next decade as demand for the metal used in the electricity and construction industries rises.
Reuters
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