Home Business Over 50% of Zambia’s Copper Mines to be Unprofitable in 2019
Business - News around Africa - Profiles - January 2, 2019

Over 50% of Zambia’s Copper Mines to be Unprofitable in 2019

Zambia’s Chamber of Mines – the country’s biggest industry lobby group, has said that more than half of Africa’s second-biggest producer of metal – Zambia copper mines, will possibly be unprofitable in 2019 as the nation raises taxes for operators with thousands of jobs on the line.

The actual tax rate will vary from 86 percent to 105 percent, with about 27,900 expected jobs losses, the Zambia Chamber of Mines said in a statement handed to reporters late December 2018, in Lusaka, the country’s capital.

Zambian lawmakers passed legislation in December which increased royalties for cobalt and copper, both key components in electric vehicles. The country is trying to rein in foreign borrowing and cut a bulging budget deficit, while mining operators that include Glencore Plc and First Quantum Minerals Ltd. have, through the industry lobby group, warned of more than 21,000 job losses and $500 million in capital spending cuts as a result.

Copper mining is the major economic activity in Zambia leading to over 70 percent of her foreign-exchange earnings. The Zambian government has put measures to diversify its economy to tourism and agriculture after copper mining industry faced its worst run in 2015 due to dropping metal prices on the international market.

The Zambian government privatized copper mining in 1990 which led to increased growth and investments. By the year 2000, private investments in the sector was worth $8 billion.

Copper mining is the major economic activity in Zambia. Four companies had employed 56,300 people by the end of 2012. An estimated 150,000 to 400,000 jobs are indirectly created by the industry.

Also Read: Small-scale gold miners in Zimbabwe to get $60m loan

Check Also

Bill Gates Earns $464.5M Yearly from these Top 5 Stocks

Bill Gates, known globally not just for his tech innovations but also as the seventh riche…