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Mining disputes will disadvantage Zambia’s chances for good investments – ZACCI

THE Zambia Chambers of Commerce and Industry (ZACCI) says the manner in which disputes in the mining sector are being handled has the capacity to disadvantage the country’s chances of atracting good investors.

And the chamber has called for a well-coordinated approach in addressing the mining investors’ intents given the auxiliary businesses and other economic benefits the sector gives to the nation.

In an interview, ZACCI president Dr Chabuka Kawesha said it was wrong for the minister to handle disputes over a multi million-dollar investment through press statements and ultimatums.

The Zambian government declared a dispute with Glencore, Mopani Copper Mine’s majority shareholders, after it placed its Kitwe and Mufulira operations on care and maintenance, sending over 11,000 workers home.

“So if those disputes or any disputes that arise are being managed in a manner that is not sending a clearer picture on how we want to handle investment disputes, that can disadvantage the country from attracting good investors. You know in business, any dispute in a business discussion, you need to sit down and discuss…where are your areas of concern, and this is our area of concern and you find a middle line. So it’s the manner in which the disputes are being handled. The Minister of Mines is addressing a dispute through a press briefing; that’s not a way to handle a multi-million dollar investment, that should be handled around the table quietly and then the parties, both government and the investor read a joint statement to say this is what has been agreed upon but not through press statements, that’s not the way to resolve disputes…it’s raising a lot of concerns,” Dr Kawesha said.

“…disputes can arise anytime anywhere in business but the manner or the way in which we handle that dispute has a bearing on getting good investors, now or in the future. So we should ensure that our mechanisms of dispute resolution with investors in the mining sector are handled with a lot of care because they have a lot of bearing. It’s the biggest employer in the country and there a lot of local suppliers and a contractors attached to the mines.”

He appeled to the government to have a business discussion with Mopani and find alternative measures on managing of the mine.

“Our comment is that Government, being an interested party in the Mopani business unit, must, through ZCCM-IH, work aggressively in outlining several alternative measures of managing the mine if at all Glencore opts to exit or scale down its investment. Issuing threats and ultimatums through public forum is not ideal. What is needed is a business discussion. To any business operation and its support mechanisms must include a business rescue strategy. It is therefore our appeal that the government through various agencies, probably Ministry of Mines, Ministry of Finance and Ministry of Commerce Trade and Industry, joined by ZCCM-IH through its technocrats, hold the necessary business meetings and draw up a business continuity plan,” said Dr Kawesha.

“The private sector is currently restricted to what we are seeing in the media on Glencore’s intent, which is more on ultimatums rather than solutions and the next steps. Counter argument from the Minister of Mines rather than possible solutions will just cause anxiety in the market and the business community at large. Mining business is key to our economy, therefore, a well coordinated approach in addressing an investor’s intent to scale down or exist would be favoured given the auxiliary businesses, other economic benefits and the global perceptions of Zambia in handling industry disputes.”

By Natasha Sakala, News Diggers

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