FQM layoffs are meant to blackmail govt - SARW
By Misheck Wangwe in Kitwe
Mon 24 June 2013, 14:00 CAT
THE Earth Organisation says mining houses should not threaten the government with job losses in order for them to get away from their obligations regarding the environment.
And the Southern Africa Resources Watch says the intended mass lay-off of over 500 workers by First Quantum Minerals is merely meant to blackmail the government.
Commenting on reports that FQM will lay off 500 workers at its Sentinel Mine in Kalumbila in Solwezi which is under construction, The Earth Organisation executive director Lovemore Muma said the government should not be held at ransom by the company to disregard environmental requirements for fear of job losses.
"Development should be in the context of sustainable development, meaning that current needs should not compromise future generation needs. So the government should not just look at current worker needs but also future generations, that is our children and their children's children's jobs, because if we destroy the environment now the future generation will have no jobs. If we are going to lose 500 jobs and preserve the environment and create more sustainable jobs in the future so be it. Furthermore, before FQM started constructing the dam, they should have sought expert option from Zambia Environmental Management Agency (ZEMA)," Muma said.
He said the river where the mine intends to construct the dam was a source of water for several cattle farmers and villagers both up and down stream and according to ZEMA regulations, erection of any project of such a nature required the investor to seek necessary approval regarding environmental protection.
Muma wondered why FQM started building a dam on the river before seeking approval from the agency, adding that the mining company should not threaten the government with job losses for not following the requirement as set by ZEMA.
And SARW country coordinator Edward Lange said the government should not abandon the corrective process just for the purpose of satisfying the interest of the operator.
"As civil society, we are alert and adhering to the guidance given by the government, and as such any mishandling of the process will not give any sustainable business environment for the company. It has been three years now since the indigenous and host community started crying, the company has disregarded their concerns, and now that the government has come to the aid of people, it should be a win-win situation," Lange said.
"We also appeal to Zambians not to abuse their rights to acquire mining rights by selling the same at a later stage without due consideration of the welfare and rights of the host and indigenous people. The Kalumbila case is a very clear lesson for us in Zambia and the SADC region on how local people can disfranchise themselves. Such threats are baseless and temporal as what we appeal for is the consideration of the main concerns of the host community in the area," Lange said.
FQM spokesperson John Gladston was quoted saying that the company had been forced to lay off the workers because it could not sustain the current high workforce, while waiting for the ZEMA to lift a protection order that had prevented further construction of the Chisola dam.
Labels: EDWARD LANGE, FIRST QUANTUM MINING, JOBS, LOVEMORE MUMA, SARW
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Shamenda urges miners not to panic
By Misheck Wange in Kitwe and Ernest Chanda in Lusaka
Sun 26 May 2013, 14:01 CAT
LABOUR and social security minister Fackson Shamenda has appealed to miners and Zambians not to panic over reports that Konkola Copper Mines intends to lay off 2,000 miners. And the Mineworkers Union of Zambia (MUZ) says KCM's plans must be immediately halted by the government and all stakeholders.
Meanwhile, the Southern Africa Resource Watch (SARW) has accused the mining giant of not being insincere to the government about its operations and the plans to retrench employees. Shamenda yesterday said the law was very clear on procedures to be followed before any company could lay off workers and those procedures had not been exhausted in the case of KCM. KCM informed the government about its intentions to retrench 2,000 workers.
"It is a requirement that employers first engage the unions on their intentions and thereafter engage the government. So far, all these processes had not been exhausted by KCM," he said.
Shamenda said to this end, no miner would be retrenched at KCM.
He said the government had stepped in and was engaging KCM management and the unions to look at the reasons behind the proposal to retrench miners.
Shamenda assured the miners and the nation that it would take care of their interests and that no Zambian would unnecessarily lose employment.
He stressed that issuing statements on a matter, which had not been exhaustively concluded, would not serve anyone.
Shamenda has since banned issuance of any statements on the intention by KCM to lay off miners saying mining was a serious industry requiring only his deputy ministers and himself to be informing the nation.
Labour matters, he said, were very delicate and Zambians needed to be careful in the manner in which they issued statements hinging on people's livelihood. MUZ president Nkole Chishimba said the negotiations with KCM should not be aimed at mitigation of the idea of retrenchment but at halting the entire process of retrenchment.
Chishimba said the plans by KCM had a huge negative impact on the country as over 20,000 people would be subjected to misery if mining giant was allowed to trim its workforce.
"Remember that these people have families and one miner looks up to about 10 people plus the extended family. KCM will set a bad precedent if it will be allowed to do that. We urge our members and every employee at KCM to remain calm and work extra hard to boost production so that we leave management with no excuse. On the other hand, we have engaged the government, KCM and all stakeholders so that we resolve this issue amicably," said Chishimba.
And SARW campaign officer for Zambia, Edward Lange, said the retrenchment plans by KCM were retrogressive and contrary to the ideals of the PF government that was working hard to create jobs.
Lange said KCM must rethink its decision and sit down with the government to find a lasting solution to the problem.
He said the government must protect the people by not allowing KCM to retrench the workers.
In a letter dated May 23, 2013, addressed to MUZ, the National Union of Miners and Allied Workers (NUMAW) and United Mineworkers Union of Zambia (UMUZ), KCM vice-president human capital David Kaunda stated that the company would lay off 2,000 permanent jobs as it had been impacted by a number of economic and legacy issues that have made it imperative to review its operations for its continued viability.
And a member of the PF central committee in charge of labour Davies Mwila said the government would prefer that KCM leaves the mines rather than allowing them to retrench over 2,000 employees.
Mwila, who is also defence deputy minister, said the PF as a party in power had been watching closely the operations of KCM and its manoeuvres to deprive Zambians that had been working very hard over the years to stabilise the operations of the mining sector which was the backbone of the country's economy.
Mwila, who is also a former general treasurer of MUZ, said KCM had not been fair to the Zambian people in its operations despite the mining company enjoying good prices of copper and other metals at the international market.
"In fact, KCM's departure is long overdue. So, if they want to leave, let them go and God will give us other progressive investors ready to work with the government rather than allowing them to sack our people. Look, 20 years ago before KCM inherited those mines, the Zambia Consolidated Copper Mines (ZCCM) employed over 20,000 people when the price of copper was 2,000 dollars per tonne and this labour force was maintained," he said.
"When KCM took over, the number of permanent jobs drastically reduced and it's now below 10,000 despite the copper price at the London Metal Exchange being around 7,000 per tonne. Today they are telling us that they have to reduce the labour force further, no! We will not allow them to embarrass the PF government. Those reasons they have advanced to lay off are not genuine."
Mwila said that, in fact, the government was not happy with the operations of KCM looking at the dilapidated roads and public infrastructure in Chingola and Chililabombwe which are not fit for towns hosting of the world's largest mines .
Mwila said the owners of KCM had built a masterpiece university in India using the mineral resources extracted from Zambia but had failed to do the same to satisfy the custodians of the minerals who were the citizens of Zambia.
He said companies like Mopani Copper Mines, Lumwana, Kansanshi and many others were working hard to supplement government's efforts to create employment.
"Two years ago, KCM started outsourcing labour force as a way of indirectly sacking our people. They brought in U and M, they later cancelled the contract and over 700 people were left jobless. MMS is another company that was contracted to work underground, the company is no more as we speak and about 600 miners were retrenched. Another company, Black Smith, was contracted at the concentrator and over 400 people are on the streets and the list of contractors whose contracts have not been renewed at KCM is huge and these people (KCM) expect us to keep quiet? No we will not allow them," said Mwila.
On Wednesday, Germany's Federal Minister for Economic Cooperation and Development Dirk Niebiel urged Zambia to put in place measures that would enable it get better contracts to reap more benefits from the mining sector.
"… It is very important to find a way to use the mining sector for financing your own budget than you can do at the moment and we could give a helpful hand to have better contracts in the future for more income, revenues for your country to invest in your country," said Niebiel.
Labels: FACKSON SHIMENDA, JOBS, KCM, MUZ, SARW
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Mopani is uncaring towards host communities, says Lange
By Kabanda Chulu
Mon 12 Mar. 2012, 12:00 CAT
THE statement by Mopani Copper Mines is a clear indication of how uncaring the company policy is towards host communities, says Southern Africa Resource Watch (SARW) Zambia representative Edward Lange.
Commenting on company chief executive officer Danny Callow's statement that Mopani was surprised at the action taken by ZEMA to shut down its treatment plant and expressed fears for the 310 jobs created by the project, Lange said the government must be vigilant to protect the lives of innocent people in Mufulira.
"Does it make any business sense to express surprise at the closure of the Heap Leach project when people have been living in anguish and pain and there have been stakeholders' discussions around the same project?" Lange asked.
"Does it make any moral sense for a human being worth being a chief executive officer, to fear for the loss of 310 jobs at the expense of more than 3,000 lives? This clearly indicates that Mopani is not interested in resolving this issue amicably as they don't know where the information is coming from leading to the suspension when people are suffering from the presence and operations of the same project."
Lange commended the Zambia Environmental Management Agency for taking a bold stance to shut down the project which had been causing acid fumes that were affecting the host community.
As a result of the acid mist and rainfall, several people have developed chest infections and various cancers and it has been difficult for people to grow food crops except for avocado and cactus plants in Kankoyo and Butondo Townships, which host Mopani mines in Mufulira.
Last week, ZEMA suspended operations at Mopani's Mufulira West Heap Leach Mining project and advised management to put in place measures to reduce effects of pollution in surrounding areas.
But Callow issued a statement refuting the findings of ZEMA, saying that Mopani was surprised by the suspension of a part of its mines, particularly that ZEMA had recently renewed its operating licence.
Labels: EDWARD LANGE, MOPANI, POLLUTION, SARW
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CSOs urge regular auditing of mines
By Kabanda Chulu in Kitwe
Tue 12 July 2011, 11:50 CAT
GOVERNMENT must undertake regular audits of mining companies’ activities so that maximum revenue starts benefitting ordinary Zambians, say civil society organisations.
The Civil Society organisations have also challenged government to urgently implement the mining revenue sharing mechanism that will result in 40 per cent going towards local communities and councils where the mines are located.
According to resolutions made by Zambian civil society organisations working in the extractive industries that met under the auspices of the Southern Africa Resource Watch (SARW), it was noted that Zambia was not maximising the benefits from its natural resources.
“These resources should benefit the nation as a whole and not just foreign companies and local political and economic elites and the recent indaba offered an opportunity for all stakeholders to debate current practices and policies and to highlight the serious challenges that the Zambian mining industry currently faces and how the lives of Zambian citizens, especially in communities near the mines, are being adversely impacted,” they stated.
“To help tackle rampant tax evasion and avoidance, government must undertake regular audits of mining companies and government should also renegotiate its share agreement with mining companies through the ZCCM-IH to increase government’s currently insufficient shareholding in mining companies.”
It advised government to review and adjust the tax regime so that it becomes fairer and just for all stakeholders.
“Since the current tax regime is complicated, difficult to apply and does not favour the Zambian people and because a fairer tax mechanism will reduce the demand for corporate social responsibility projects and government should also design an integrated development mining policy that will ensure that part of revenues collected from mining operations remain in local communities,” the CSOs stated.
“Government should also introduce a self adjusting tax regime that will ensure predictability in the sector and will guarantee equitable revenue sharing regardless of the price of commodities on international markets.”
The civil society further challenged government and mining companies to make their development agreements public.
“Since these agreements are currently secret, making it difficult for civil society and affected communities to monitor what the government and companies are doing and they must publicly disclose the contractual obligations between them,” stated the CSOs.
“And communities living near mines must be actively consulted throughout the process from negotiations to operations to eventual mine closures since these communities are often very poor and marginalised and bear the brunt of the mining activities in terms of environmental degradation, air and water pollution, and unfair resettlement.”
Labels: AUDITING, CSO, SARW, TAX EVASION
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Mopani’s tax issues provoke debate
By Kabanda Chulu in Kitwe and Gift Chanda in Lusaka
Sun 13 Feb. 2011, 03:59 CAT
TAX payment irregularities revealed by the audit report at Mopani mines has silenced all arguments against the reintroduction of a simplified mining revenue collection system such as the windfall tax, says Dr Fred Mutesa.And Consumer Unity and Trust Society (CUTS) International has called for an industry-wide audit to be conducted in the mining sector to ascertain the true extent to which companies are evading taxes and how much Zambia has lost so far.
Meanwhile, Nkana PF parliamentarian Mwenya Musenge has challenged finance and mines ministers, Situmbeko Musokotwane and Maxwell Mwale, respectively, to stop acting as if they ‘know it all’ because their mining policies had failed resulting in Zambia losing millions of dollars.
Commenting on revelations of tax payment irregularities and inconsistent production figures that are submitted to the ZRA, Dr Mutesa, who is Zambian Empowerment for Development (ZED) president, said the right thinking Zambians had been vindicated for calling for fair and equitable taxes from the mines.
“If not properly checked, multinational companies such as Mopani and many other mines will continue to under invoice and under price for purpose of tax avoidance and evasion. So it is time to come up with a tax regime that is easier to enforce and collect revenue and also to compel the mines to do more on corporate social responsibility since copper is a waste asset and soon we shall very negative environmental liabilities,” Dr Mutesa said.
And CUTS stated that the irregularities reveled at Mopani mines were just a tip of an iceberg of how much more dirty business was going on in the mining industry. It stated that the government should own up on the basis of the revelations and carry out an industry-wide audit to ascertain the true extent of the tendencies to evade taxes as the only way to ascertain how much the country had so far lost in taxes.
CUTS further stated that the government should treat the revelations as a wake-up call to institute measures that would not only address the glaring revelations but end the abuse of the country's resources especially in the mining sector.
It urged the government to stiffen regulations under the Extractive Industry Transparency Initiative which will compel the mining firms to release timely and accurately financial figures.
“There is no doubt that the weaknesses of Zambia Revenue Authority have been exploited and a lot of money siphoned out of the country through methods such as deliberate failure to appreciate the tenets of transfer pricing and through accounting manipulation. This is a clear sign of tax avoidance and evasion and this should be a wake-up call for the government,” CUTS stated in a press release.
CUTS also called for the reintroduction of the windfall tax.
“It is common knowledge that profit based tax system are a problem given the capacity of the Zambia Revenue Authority hence the urgent need to revert to volume and sales based taxes,” CUTS advised.
It stated that mining firms had continued to make profits even at the expense of the consumers’ health.
“Not long ago, Konkola Copper mine polluted the Kafue River for the second time putting the health of workers and consumers at risk. It is important that we take a courageous step on our natural resources and we must realize that Zambia will only develop from its natural resources, copper being the main product,” stated CUTS.
Mopani operates mining units in Kitwe and Mufulira is 73.1 per cent owned by the Swiss commodity trader, Glencore AG.
And Musenge said the MMD government and its ministers should listen and realise that Zambians had been given a raw deal by the so-called mining investors.
“The unpleasant thing is that we have lost money because of the adamancy by Situmbeko and Mwale who insist that the mines are not making profit,” said Musenge.
“In 2008 during debates to amend the mines and minerals Bill, I proposed the establishment of a Minerals Accountability Directorate which should monitor from extraction to finished products and come up with independent figures and then advise ZRA on how much to collect as revenue since ZRA lacks capacity to genuinely tax the mines.”
Southern Africa Resource Watch (SARW) Zambia Representative Edward Lange said irregularities revealed in the audit report were a clear indication that Zambia should quickly be part of the Extractive Industries Transparency Initiative (EITI) where the mines would be compelled to publish how much they paid in taxes.
“If The Post did not publish this report, we wouldn’t have known about it and it shows the arrogance and hostilities which these mines have towards Zambia because they have government backing. And time to build the capacity of ZRA is now so that we avoid losing out,” said Lange.
Government with support from co-operating partners commissioned a pilot audit conducted by Grant Thornton and Econ Poyry of Norway, that revealed inconsistencies in production and revenue figures Mopani submits to ZRA for tax administration.
Dr Musokotwane has not acted on the findings of the report despite receiving it in August last year before the budget announcement.
Labels: CUTS, EITI, FRED MUTESA, MOPANI, MWENYA MUSENGE, SARW, TAX EVASION, WINDFALL TAX
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Address exploitation of resources, urges SARW
By Kabanda Chulu in Kitwe
Fri 26 Nov. 2010, 03:59 CAT
SARW Zambia representative Edward La-nge yesterday challenged the government leaders to urgently address the illegal exploitation of natural resources to avoid increased conflicts and instability in the sub region.
And Lange has advised that reports and publications which the Southern Africa Resource Watch (SARW) supports do not represent the views of the institution but those of the authors and writers.
In an interview ahead of next month’s International Conference of the Great Lakes Region (ICGLR) heads of state summit scheduled for Lusaka, Lange urged member countries to implement rules and regulations that would reduce illegal exploitation of natural resources.
“It is widely recognised that illegal exploitation as well as the trade of natural resources contribute to the instability in the region and represents an impediment to economic and social development in the ICGLR region and we urge member states to find solutions to this problem through mutual agreement within the framework of close regional cooperation,” Lange said.
“We are saying so because the potential of conflict is high especially over the exploitation of resources along common borders and if not urgently addressed, it may explode since we seem to be sitting on a time bomb and as civil society we should also increase our advocacy against illegal exploitation of natural resources through regular interface with leaders so that this indiscriminate stealing can be stopped.”
He explained that regional civil society organisations recently met in DR Congo and resolutions of that meeting would be presented during the Heads of State summit in Lusaka.
“We are hoping to feed into the deliberations of the summit and present our resolutions since we are working for the same cause and Zambia has an opportunity as host nation and chair to share experiences and learn from what is obtaining in other countries. For instance, corporate social responsibility is voluntary in Zambia but in other countries it is compulsory,” Lange said.
He further said SARW supported various publications that were written by several authors.
“But their views do not necessarily represent that of the institution but individual authors,” said Lange.
SARW was established in 2007 and is supported by the Open Society Initiative in Southern Africa (OSISA), with its focus on promoting sustainable use of natural and mineral resources.
Labels: EDWARD LANGE, SARW
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