Maravi

Falling copper prices worry govt

Falling copper prices worry govt
Written by Chibaula Silwamba
Saturday, November 22, 2008 9:32:38 AM

VICE-PRESIDENT George Kunda yesterday told Parliament that the government is concerned about the falling prices of copper because that will reduce Zambia's foreign exchange (FOREX) earnings.

And Vice-President Kunda observed that the increasing prices of mealie-meal are adversely affecting Zambians and that the government intends to import the commodity to cushion the prices.

Responding to Roan Patriotic Front (PF) member of parliament Chishimba Kambwili who wanted to know what the government was doing to prevent copper mines from closing down due to the falling copper prices on the world market, Vice-President Kunda said the government was concerned about the trend of copper prices.

"As I said earlier, the issue of the impact of copper prices on the Zambian economy is a matter which we will discuss next week through a statement which will be issued but as government, we are concerned about the trend in the copper prices because that will mean less receipt of foreign exchange," responded Vice-President Kunda during the weekly oral question and answer session.

Earlier, Vice-President Kunda said: "I have directed the Honourable Minister of Finance to issue a ministerial statement next week so that we can discuss in detail matters to do with the global financial crisis. Today [yesterday], I was listening to CNN...to the BBC, the price of oil for example because of the lowering demand on the commodities, it has gone below US$ 50 per barrel. These are some of the effects which are coming out of the global financial crisis. But as I said, let us wait until next week. The Honourable Minister of Finance has already prepared a statement which will be discussed in this August House."

In his question, Kambwili wanted Vice-President Kunda to explain the measures that the government had put in place to protect mines from closing if copper prices continued dropping.

And Namwala UPND member of parliament Major Robby Chizhyuka asked Vice-President Kunda to explain how many metric tonnes of maize Zambia exported to Zimbabwe this year and what it intends to import to cushion the maize shortage.

"Could the Vice-President advise how much maize we exported to Zimbabwe earlier on this year and at what price? And at which price we are going to import the 100,000 metric tonnes of maize. Given this comparative, does that reflect prudent economic management by the government?" asked Maj Chizyuka.

In response, Vice-President Kunda said he did not have the figures but assured that the government was putting in place measures to cushion the high prices of mealie meal.

"As regards the price of mealie-meal, we are concerned and also the issue of price at which we are going to buy the maize, as the minister indicated yesterday, we are looking for non-GMO [Genetically Modified Organism] maize and the price is a question of supply and demand," he said. "The price at which we will get that is something we cannot determine in advance. Further, the exchange rate fluctuation will be there and therefore it is not possible for me to foretell what kind of price we are going to have. But it is the intention of government to continue to review and to import maize, which we can get so that we cushion the price. We know that this is affecting our people adversely."

Mazabuka Central UPND member of parliament Gary Nkombo observed that Zambia last year experienced floods hence he wanted Vice-President Kunda to explain how ready the government was to combat such calamities this rainy season.

Vice-President Kunda, in his response, said the Disaster Management and Mitigation Unity (DMMU), which is in his office, was ready to tackle the effects of floods and other calamities.

"I have received a comprehensive brief on the situation regarding floods for last year and even anticipated floods for this year and we are already preparing," he said.

PF's Munali member of parliament Mumbi Phiri asked Vice-President Kunda to explain why there was a reduction in the number of female Cabinet ministers.

But Vice-President Kunda said appointments to Cabinet should be on merit.

"The protocols which we signed especially the protocol on gender, is a very important protocol to the government and we have risen to the challenge in implementing that particular protocol. It's not only Cabinet that we should be talking about but various positions of decision making; we have tried as much as possible to implement that particular protocol. But what I must also say is that sometimes appointments should also be on merit. You agree with me on that. Isn't it? Merit should be considered," Vice-President Kunda said. "Furthermore women should participate in politics so that they can compete and be elected. But as regard to positions in Cabinet, you know very well that this is the prerogative of the President and we also look at what is available. We have made these appointments taking into account all those factors and the protocol."

And Vice-President Kunda defended Rabobank's 49 per cent shareholding in Zanaco.

He was responding to Forum for Democracy and Development (FDD) vice-president and Chasefu member of parliament Chifumu Banda who asked Vice-President Kunda to tell Parliament the current shareholding of Rabobank in Zanaco and whether this shareholding was in compliance with the provisions of the banking and financial services Act.

Vice-President Kunda, who is also justice minister, said although the banking and financial services Act required that a shareholder could only have a maximum of 25 per cent shares, there were exceptions.

"The shareholding of Rabobank in Zanaco is 49 per cent. Now, the banking and financial services Act requires that a shareholder should hold at least 25 per cent... that is what the law requires," Vice-President Kunda said. "Now if you have read that Act, you will discover that there is an exception to that rule, if a financial institution is listed on a recognised stock exchange, it can hold more than 25 per cent. So the holding of Rabobank in Zanaco is perfectly lawful and in order."

On foreign policy, Moomba UPND member of parliament Vitalis Mooya asked Vice-President Kunda to give the current stance of Zambia on the Zimbabwe crisis.

"I think now we are quiet before we were not quiet. What is our stance?" asked Mooya.

In his response, Vice-President Kunda said the Zimbabwe situation was being addressed through the Southern African Development Community (SADC).

"The problem of Zimbabwe, as you know this country is our neighbour and what happens in Zimbabwe is a concern not only to Zambia but to the entire SADC region. Recently, we had a SADC summit in South Africa at which we were represented by our Minister of Foreign Affairs and this problem is being tackled through the auspices of SADC," said Vice-President Kunda. "We have encouraged the people of Zimbabwe to resolve their problems, to constitute a government. That is Zambia's position."

Labels: CHISHIMBA KAMBWILI, COPPER, GEORGE KUNDA

posted by MrK @ 9:34 AM