Editor's Comment

Walk the talk on value addition

COPPER, which has been mined for decades in Zambia, is still the goose which lays the country’s golden eggs.

It is still the major foreign exchange earner despite efforts made in developing other sectors of the economy such as agriculture, manufacturing and real estate.
However, there are other minerals which also have the potential to rake in the much-needed foreign exchange.
The country has many deposits and occurrences of other metals and industrial minerals, such as barite, feldspar, graphite, iron ore, kaolin, lead, silica sand, talc, and zinc.
Copper and other minerals have been sold as raw materials to countries which refine them into finished products.
Some of the finished products are copper wire, strips, tubes, bars and sheets.
Most of these find their way back into Zambia.
This situation needs to be reversed so that minerals mined in Zambia are processed locally and exported already refined.
The countries which buy Zambia’s copper and other minerals process them and re-send them to Zambia.
It is good therefore that the Ministry of Mines and Minerals Development has started drafting a bill which will compel mining houses to add value to the minerals that they extract. This will not only enhance job creation, but also earn Zambia more revenue (through tax) as the products exported will be of higher value.
Minister of Mines and Minerals Development Christopher Yaluma said at the weekend that once the bill is drafted, it will be presented before Parliament for enactment.
The bill is long overdue because it will boost the manufacturing sector as well as spawn spin-off business ventures.
We hope that beyond the policy announcement by the minister, players in the market are positioning themselves to benefit from the gesture.
Before that happens, however, all the players should provide some input on actualising this plan. This is evidently not a straightforward matter and so it requires collective efforts to ensure that the objective is met.
As it were, such pronouncements have been made before in the past, but not much has come out of the plan which many people agree with, and yet the status quo of exporting raw materials has continued.
One of the challenges has ostensibly been finding a market for the value-added copper products, considering that Zambia consumes a very small percentage of the 700,000-plus tonnes of copper mined.
The distances from Zambia to the markets are arguably another challenge.
The experts should therefore get around these challenges considering the argument that producers would prefer to add value to this raw material as close to the market as possible.
Surely, there are business models that should fit into Zambia’s scenario and have a win-win outcome for all.
For instance, mining companies (especially those that Zambia has shares in), should shoulder a significant chunk of this challenge to make it happen.
Zambia should take advantage of its all-weather relationship with China by replicating the value-addition technology in the country.
With concerted efforts by all the players, copper and other minerals will be processed into finished products.
As one of the biggest producers of copper and other minerals, the country should take advantage of its comparative advantage.
Copper production, which is next year likely to hit between 800,000 and 850,000 metric tonnes due to the favourable market conditions on the international scene, can help the country diversify.
Mining firms should translate the value addition concept religiously and make the country a hub for manufacture of minerals, which are on demand on the international market.
This is the time Government and mining companies should start walking the talk.
Let us add value to our minerals.

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