BUUMBA CHIMBULU writes
GOVERNMENT should seriously rethink its relationship with the mining industry and ensure the sector significantly contributes to the well-being of communities and economy.
This is according to the Private Sector Development Association (PSDA) chairperson Yusuf Dodia.
Mr Dodia said there was the need for the mining industry to invest in the communities they operated in while contributing significantly to the growth of the national economy.
He was speaking yesterday in an interview with the Sun.
“Government seriously needs to reconsider the entire relationship with the mining sector in Zambia. What we should be seeing is the maximum contribution out of the mining sector. The resources generated should be used to invest in the growth of the economy,” he said.
Mr Dodia also said it was important for mining companies to invest in the communities they operated in unlike lamenting on the new mining taxes introduced by Government.
The mining taxes, he said, were distractions from the real issues.
“The new taxes are just a small amount of money amounting to about US$400 million per year, which is nothing when you look at US$6 billion worth of revenue the mines generate annually,” he said.
Mr Dodia said out of the US$6 billion revenue generated annually from the mining sector, only about US$1 billion was invested in the local economy.
Government, he said, should develop a mechanism to ensure that all export earnings from the mining sector were accounted for in the local banks.
He said there should be a law which would compel mining houses to ensure that all export earnings were accounted for in the local banks.
“We should also follow other best practices such as receipts of export earnings being accounted for in the Zambian banking system. We have seen some economies such as South Africa that insist that all export earnings should be accounted for in the South African banking system, which created capital for development and growing the economy.
“This is not happening in Zambia. Can you imagine that out of the US$6 billion of exports we are lucky if we can see US$1 billion back into the economy,” he said.
Lately, the mining industry has threatened to retrench workers citing the new tax measures which have been introduced by Government.