Zambia’s proposed mining reforms threaten investors’ rights, with a new state-owned company set to control 30% of future copper production. The Chamber of Mines warns of arbitrary regulatory powers and inadequate consultation by the government, jeopardising investment incentives and production targets.
Zambia’s mining sector faces significant upheaval due to proposed government reforms that threaten investors’ rights, according to the Chamber of Mines. The planned establishment of a state-owned enterprise intends to take control of at least 30% of future production from critical minerals like copper. The Chamber criticises the government for not sufficiently consulting with mining firms, risking setbacks to investment efforts that have boosted the economy since 2021.
Zambia’s economy heavily relies on copper, contributing approximately 70% to its export revenues. The government aims to boost copper production from less than 700,000 tonnes last year to three million tonnes by the next decade. These ambitious targets will require substantial investment in the mining sector, which could be jeopardised by new governance laws that purportedly allow regulators excessive discretionary powers, risking corruption.
The proposed reforms in Zambia’s mining sector represent a significant challenge for investors, with the Chamber of Mines expressing concern over possible corruption and a lack of meaningful government consultation. These developments could undermine past efforts to attract investment and drastically impact the country’s mining industry and economic growth.
Original Source: africanminingmarket.com