By Cleb Fundanga
Zambia as a country is gifted with an abundance of natural resource. The biggest injustice one can point out is how government has failed to critically implement measures that will regulate mines as well as provide technical and financial assistance to indigenous Zambians in the mining industry. The national budget of 2017 saw a gross reduction in revenue collection from the mines compared to 2016. This points to two aspects that the Mine Workers Union of Zambia (MUZ) has addressed being accountability and transparency. The Mineral Value Chain Monitoring Project (MVCMP) which is in the process of being enacted is a great step in curbing the continuous loss in revenue government is facing but it does not address the issues critically.
Government must invest in small scale miners by creating a co-operative that not only provides technical assistance in mining but financial as well. The key element of such a co-operative is to act as a parent to these small scale miners, through monitoring and assessing their growth and potential. Organizations like the Development Bank of Zambia and Zambia Development Agency are also key players in this industry. A co-operative that partners with Development Bank of Zambia has the capability to link and carefully align small scale miners with the right facility to help with the growth of a respectful mine. It should be noted that the majority of the individuals in the mining industry fail to grow their business because of a lack of education in the financial sector and with that creates a system of traditional mining whose end products end up on the black market with zero revenue gain for government. The Zambia Development Agency also has a critical role to play in this plan. Zambia currently has a number of small scale mines looking for investment from foreign entities and the Zambia Development Agency should be investing more time in workshopping with small scale individuals to draw up action plans that will make these mines more accessible to investors looking at opportunities in Zambia. Through a co-operative this is possible as it will provide a database that will ensure adequate information will be at the fingertips of the agency. Foreign direct Investment in the mining sector in Zambia still has a lot of room to grow and stake-holders must play an aggressive role to ensure our biggest resource is capitalized.
A co-operative further helps government in revenue collection if managed properly. A mineral stock exchange can be implemented through the co-operative where precious mineral dealers have access to a floor where small scale miners offer their minerals to potential buyers. This allows government to monitor the exchanges in turn taxing them accordingly. It is critical that the co-operative invests in creating an environment that is attractive to the miners and buyers to ensure transparency.
The 6th Zambia Alternative Mining Indaba (ZAMI) is kicking off and concerned Zambians are hoping stake-holders will start looking at such practical solutions to helping the growth of our mining sector.
Chipindi Caleb Fundanga
Institute of Finance and Economics