Mining in Zambia dogged by high costs of production-ICMM

Mining in Zambia has been characterised by high costs and  low productivity, especially in the Copperlebt Province, says the International Council on Mining and Metals (ICMM).

In its inbrief report “Enahancing mining’s contribution to the Zambian Economy and Society” the council says since 2008 several policy changes, such as those to do with foreign  exchange have put the industry under additional pressure, making some mines vulnurable to changes in their economic circumstances.

It says however despite that, mining activities in Zambia have had an important impact on host countries at  both national and local levels where mining activities take place.

At national level, the Zambian economy is dependent on mining, while exhibiting the inverted pyramid pattern of macroeconomic contributions.

“ Some of these contributions have changed dramatically in recent years. This is particulary true for the sector’s contribhution to government revenue where large increaases have occurred” it says

The report further says that in 2012 almost one-third of all taxes received by government was from the mining sector, representing a dramatic change from earlier years where as recently as 2008 the contributiion of tax revenue from mining was around 16 per cent of total tax revenue.

“Zambia is now one of the countries with  the highest contributions to the tax base from the mining,” says the report.

At the local level,mines contribute to the areas in which they operate through two main channels one of which is by commercial activities ( employing and training people and procuring goods and services) and through social investments.

“Mining plays a vital role in generating employment in an around mining districts. Together the  four mining companies, KCM, FQM Kansanhsi, Mopani Copper Mines  and Barrick Lumwana employed 56,300 people in 2012, almost of whom were Zambians” it says

And ICMM is today expected to launch the final report of the independence study exploring the economic and social contributions of mining  in Zambia to the government at Lusaka’s Taj Pamodzi Hotel.