All kinds of smells in Zambia - but tourism's good

Friday, 15 November, 2013

A mixed bag of news from Zambia - lest we forget, the world's largest copper producing company - over the last couple of days. brings us the news that the Zambian government has cancelled the work permit of Vedanta's local CEO on the basis that "he was being very arrogant". Context: London-based Vedanta Resources plc is the biggest investor in Zambia's mining industry, and that's a direct quote from Minister of Information and Broadcasting Mwansa Kapeya.  

More context: government had been criticising Vedanta's Konkola Copper Mines unit after Vedanta said they'd be sacking over 1,500 workers as a cost- cutting measure, supposedly necessary as a result of an unfortunate combination of a fall in the grade of copper in the ore coming out of the mine, low market prices and poor worker productivity. In response, President Michael Sata said early this month that if the company dismissed anyone, he'd cancel its license completely. The (state-owned) Times of Zambia newspaper published an article a couple of days later saying that the company had fired 76 workers effective Sept. 19.

Kapeya's response, which implies there are more than a few communications issues at work here: "The government said you just can't be terminating employment without giving a specific reason."

Even more context:  Vedanta is also suingZambia's revenue authority over a 3.2 billion kwacha ($586 million) tax charge on exports of copper cathode, seeking the reversal of the Zambia Revenue Authority's decision to charge 16% VAT on the exports from January 2011 to March 2013.

A more measured take was provided by Mineweb's typically informative summary last Wednesday:

"President Michael Sata, a populist who swept to power two years ago on an activist platform to defend workers' rights, has been taking a hard line with miners and other foreign companies that have tried to lay off workers.  "It has been observed that some investors in some mining companies have found it necessary to downsize their workforce each time they are faced with operational challenges," the government said in a statement on Wednesday. "Government views such actions as a violation of, and not within the spirit of the investment licence."

The government added that it was "unwarranted, unfortunate and unacceptable" for mining companies to cut jobs before consulting the government and other stakeholders.""

In other Zambian mining problems recap news, an older article from the Lusaka Times (Lusaka Times, 18 October 2013) that really speaks for itself:

"Mopani sulphur-dioxide emissions cause Mufulira District Commissioner to collapse

MUFULIRA District Commissioner (DC) Beatrice Mithi was on Tuesday left requiring the services of an oxygen machine when she collapsed after allegedly inhaling the highly-toxic sulphur-dioxide emission by Mopani Copper Mines (MCM)... She was taken to the hospital unconscious where she was admitted and put to on oxygen until yesterday when she was discharged.

...Narrating how she suffocated, Ms Mithi said she was returning from officiating at a function at Ronald Ross Hospital within the district when MCM plant in Kankoyo discharged the sulphur-dioxide into the [atmosphere]. "I was returning from officiating at the hospital when suddenly there was fume in the atmosphere, which apparently happened to be sulphur-dioxide emission by Mopani Copper Mines. "I got choked by the sulphur-dioxide emission and I immediately collapsed after becoming unconscious," she said.... "It appears the type of sulphur-dioxide Mopani is discharging at the moment is highly toxic because the case involving myself is the second one after another person who is asthmatic also was affected last week," Ms Mithi said. 

She said from information to her knowledge, the person who got choked last week allegedly by the sulphur-dioxide emission died unfortunately."

HOWEVER: all is not lost. If you are prepared to brave the toxic clouds and toxic labour disputes, looks like Zambian tourism might be on the up. At a do to accompany the launch of the new World Bank Tourism in Africa Report, Harnessing Tourism for Growth and Improved Livelihoods, Zambian Minister of Tourism and Arts Ms. Sylvia Masebo has said, “Our desire as a government is to create a positive investment climate for tourism development. A climate which will not only diversify the sector but also ensure that its growth is broad based to improve the livelihood of our people, particularly in the rural areas where poverty has reached unacceptable levels. We want a tourism sector that will not only change their lives for the better but also one that protects communities and their environments.”  The World Bank's headline assessment: "Tourism to energize the Zambian economy boosting growth and livelihoods". Well, good.

From personal experience it is a lovely country and well worth a visit. If you're not the downsizing asthmatic CEO of a local mining outfit.