Monday, June 03, 2013

(STICKY) Poor mining deals
By Editor
Sun 26 May 2013, 14:00 CAT

It is true that we are not getting the best contracts, deals to enable us reap more from our mining sector. And help in this area is needed. The offer by Germany to help us secure better contracts should be grabbed with two hands.

It is clear that the negotiating conditions are unequal. The powerful transnational corporations exploiting our mineral resources have in their service the best lawyers, economists, accountants, mining experts and so on and so forth, discussing matters with a country plagued with problems and difficulties, a country that is already undermined and weakened.

Even the little expertise that we have in law, economics, accountancy, mining and even politics is at their service as consultants, advisors or agents of all sorts. The best of our people are with them. People who are supposed to be advancing or defending the interests of our country are instead working for them, representing their interests. And some of them are very well placed in our national institutions and are influencing government policies and programmes in their favour.

This is so because they have got much deeper pockets and can pay more than the government can.
These transnational corporations have their economists, lawyers, mining experts and politicians to speak for them, theorise for them and the media to disseminate their desires. To survive all this, the people must also have their own economists, lawyers, mining experts, politicians among the ranks of the intellectuals; first of all, economists, lawyers, mining experts - those with a political sense, not economists, lawyers, mining experts to serve the transnationals. Economists must develop ideas based on profoundly scientific foundations and human experience and convey them to their people.

Today, economists of the people must be political economists; and politicians must be politicians with - if it is possible - a maximum of knowledge. Today, that is really the basis on which the fate of our people depends. And the politicians who do not understand, or do not strive to understand what is going on, how we are being ripped off are not worthy of exercising their duty.
It is not a matter of saying nice things so that we are well spoken about in their media. It is not a matter of expressing things to obtai support from these same people and their associates.

We have a duty to speak truthfully about these things because the future of our people depends on them. There is a lot of play-acting when it comes to matters like these and one can see how demagogy prevails, along with a submission that sometimes borders on slimy flattery and weakness in many of our people. Of course, we must admit that there are serious politicians, economists and other experts even under these conditions; some who are even courageous.

We need to get a fair deal from all these mining contracts or we will have very little to show at the end of the day when all these minerals are depleted.

Let's look at what other countries are getting from the exploitation of their minerals by transnational corporations. Let's compare ourselves with Chile, taking into account certain disadvantages we may have to investors. Let's look at what is happening in all other places.

We have to develop our country through mining and from the earnings we get from mining. If what we are getting from mining is peanuts, then let's pause until we are able to do things in a more profitable way. If we are unable to exploit our country's mineral resources in a profitable way, let's leave it for the future generations who may have better ways to do it. This is so because the mining going on today will deplete the resources available. If from today's mining we are not earning enough to help build the Zambia of the future, then the generations to come will have nothing to stand on. It's either we exploit the mineral resources profitably and build the infrastructure and other things required for the future or we leave these mineral resources for the future generations to exploit profitably and meet the challenges of the time.

We are being consistently reminded by many western governments and institutions that we are not earning enough from our country's mining activities. We don't seem to be moved much by these concerns as we are so quickly moved by the removal of subsidies on fuel and the consumption side of maize. Yet this is where the money for these subsidies some people want to retain is supposed to come from.

Yes, there is competition for investors in the world. We are not the only country with copper. But if it's not possible for us to compete profitably, then let's abandon mining, at least for now, and concentrate on other things where we can get a better return as a country.

However, we are convinced that our mineral resources can be exploited profitably, but there is something seriously wrong with our approach to the whole issue. And it is this that must change.

We are settling for very little when we could get more. This is the point German Minister for Economic Co-operation and Development Dirk Niebiel is trying to tell us. He is not the first one to make these observations. The World Bank and the International Monetary Fund have made similar observations before. And these are people and institutions that are usually on the side of transnational corporations. For them to tell us that we are not getting good deals from these mining transnational corporations, then there must be something seriously wrong.

But at least we have been offered help by the German government to get better mining contracts. Let's engage them and see how far we can go in improving things with their help and support.

It doesn't make sense to go looking for aid, to go borrowing money when we are giving away money unnecessarily through poor mining contracts. Actually, the money we are begging for is the same money we have given away to the transnational corporations to take to their home countries. Let's meditate deeply over this issue and make the necessary changes. Let us put in place measures that will enable us get better contracts and reap more benefits from our mining sector.


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