Zambia is seeking to increase its control over the lucrative mining sector – the country’s main generator of hard currency, as it navigates a debt crisis.
While speaking on Thursday, Zambian President Edgar Lungu said that owning a stake in some strategic mines gives the state the leverage required to utilise the defined mineral resources to benefit the nation.
“I must mention that this is not nationalisation of the mines, on the contrary, it is the state acquiring majority stakes in selected mines while allowing private investors to also participate in the sector,” said Lungu.
The President did not however identify which mines the state would target for majority ownership in Africa’s second-biggest copper producer.
The latest move towards direct ownership of the mining sector sees Zambia’s mining investment arm ZCCM-IH is in talks with Glencore to acquire its majority stake in Mopani Copper Mines, after the government butted heads with the Swiss-based company over a temporary shutdown of the mine due to Covid-19. Other mining companies include First Quantum Minerals, Barrick and Eurasian Resources Group.
The country’s economic recovery plan set out targets for the coming years. Zambia will aim for a real economic growth of more than 3% by 2022. It also aims to cut the fiscal deficit to 9% of gross domestic product (GDP) in 2021, 6.1% in 2022 and 4.9% in 2023.
The southern African nation became the continent’s first pandemic-era sovereign default last month after it failed to pay a coupon on one of its dollar-denominated bonds.