Livingstone, Zambia — MININGREVIEW.COM — 10 February 2009 – The government of Zambia – Africa’s largest producer of copper – says state mining revenue is declining steadily, and more than 5 000 jobs have been lost as a result of plunging prices for the metal.
“The only revenue is mineral royalties from the mining companies, and these are being adversely affected by the collapse of metal prices,” said minister of mines and minerals development Maxwell Mwale in an interview here with Bloomberg News. “The state isn’t getting any corporate taxes from mining companies, which are losing money,” he added.
Bloomberg News quotes Mwale as saying that the Zambian government has also removed a one-off tax on mining companies in its 2009 budget, reduced duty on heavy fuel oils and customs tariffs on copper powder, flakes and blisters.
“Copper prices should recover to US$4 000 a metric ton in the third quarter,” Mwale said, “compared with a current price of US$3 540 on the London Metal Exchange.”
Meanwhile British metals explorer African Eagle Resources plc has announced in London that it will defer a development decision on its Zambian copper mine until the middle of the year, because of the decline in the price of the metal.
“We are putting off final economics, probably until the middle of the year or thereabout,” managing director Mark Parker told a mining conference in Livingstone, Zambia.