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Zambia sees bright future for copper

Zambian mines
minister Maxwell
Mwale
 
Lusaka, Zambia — MININGREVIEW.COM — 10 August 2010 – Zambia, “’ Africa’s leading copper producer “’ says it expects a strong performance by its mines over the long-term due to rising metals prices, and it has urged mineworkers’ unions to support new investors.

Mines minister Maxwell Mwale told Reuters the future of copper mining appeared very promising as the price of the metal was expected to remain high over the long-term due to increasing demand.

“The outlook for copper mining is very bright. Copper will continue to be sought because it is ideal for construction and is a very good conductor of electricity which cannot easily be substituted,” Mwale said in an interview.

He added that keeping the existing investments and attracting other experienced mine investors would help Zambia reap maximum benefits from rising global metals prices.

“We need to invest in exploration activities and that will require a lot of investment,” Mwale said. He added that the government would maintain existing taxes as stability was important for the country to continue attracting investments.

Analysts say Zambia’s mineral royalty at 3.0% is favourable compared with others of around 5.0%. Corporate tax is charged at 25% and profit variable tax at 15%.

Mwale said mining unions should support government efforts to attract investors in mining, as that would create more jobs.

Zambia’s largest mine workers’ union said in July that it planned to block Brazilian Vale’s development of a US$400 million (R3 billion) copper mine because of concerns about its bad labour relations record.

“The union should consider the socio-economic benefits of the project and look at other benefits such as Vale’s expected contribution to the treasury through taxes,” Mwale pointed out.

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