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(STICKY) Zambia can still benefit from mining sector – minerals specialist

COMMENT - Neoliberalism has failed. It would be great if the major political parties could make a public statement on where they stand with regards to economic policy, including the neoliberal economics imposed by the IMF and World Bank. We are all eager to hear from the MMD, UPND and PF on this issue.

Zambia can still benefit from mining sector – minerals specialist
By Kabanda Chulu in Accra, Ghana
Thu 26 Aug. 2010, 18:00 CAT

THERE are still strategies which countries like Zambia can apply to reap benefits from the minerals sector owned by foreign companies following the unfair privatization of the mining industry, WITS University lecturer Nicolas Pons-Vignon has said.

And Third World Network (TWN) Africa programme officer on Political Economy
Gyekye Tanor said neo liberalism with its free market policies will not bring development to African countries.

Commenting on the Zambian privatisation of the mines where multinational
companies were given massive incentives and tax concessions, Pons-Vignon, who is a specialist on minerals economy and energy industrialization, said natural resources can be an opportunity if the concerned government understands the broader contexts.

“Zambia’s privatisation was a worse moment when copper prices were low and the country settled for 0.6 per cent mineral royalty (now revised to 3 per cent) and gave out various incentives to the buyers at the expense of national economic development, this is not fair and it is not too late since there are still strategies to reap benefits from the minerals sector,” Pons-Vignon said.

“Firstly, there is need to renegotiate those unfair development agreements especially that there is now increased competition for mineral resources and there must be in place a development productive strategy that links mineral rights to local content conditions and training and lastly, there must be capacity building in geological survey because there is a tendency by foreign investors with vested interests to hide something, for instance, they will say the mineral content on this site will last a few years and ask for a lower price but if your people are qualified then it will be a different story.”

And Tanor said there is need to bring back state intervention and to play an active role in the political and socio-economic sectors of African countries.

“It is widely recognized that the current financial crisis is the result of
fundamental drawbacks of the neo-liberal model that has been shaping global
economic policies in the last three decades and these drawbacks were magnified by policy failures and lax regulations in the advanced countries were the crisis originate d from,” said Tanor.

“African governments have followed economic reform programmes based on the primacy of self regulating markets, severely reduced government involvement and the attraction of FDI for promoting development, however, these programmes have neither been able to address the key structural constraints in these economies, nor have they led to structural change and economic diversification but neo-liberalism has just reinforced the inherent vulnerability to external shocks.”

Labels: GYEKYE TANOR, MINING, NEOLIBERALISM, NICOLAS PONS-VIGNON

posted by MrK @ 11:26 PM