By Patson Chilemba
Former Commerce minister Bob Sichinga says President Hakainde Hichilema simply fails to accept the truth, wondering why he claimed that the country had for the first time negotiated 49 percent shares in a mine, when he should have known better that Zambia had more shares in the mines his own companies valued.
Speaking with Daily Revelation, Sichinga also wondered why the country’s conditions were worsening given the IMF’s prescriptions which the government bought into so much, as opposed to using local solutions like owning the rich mining and other natural resources in the country.
Sichinga said raising the reserve ratio and the monetary policy to address the Kwacha depreciation was already showing how fruitless the whole exercise was as it was like prescribing abdominal medicine for someone who was suffering from malaria.
He said raising the reserve ratio and monetary policy had a negative effect of reducing money supply while pushing up the interest rates and subsequently the cost of business in the country.
Sichinga said fundamentally, the country was experiencing problems with the Kwacha and other economic fundamentals because of inadequate Dollar supply in the economy, wondering where the country’s forex would come from without owning the mines.
He said in the Kansanshi Mine, the government through ZCCM-IH owned 20 percent shares with First Quantum Minerals owning the rest, but the government gave up the shares, questioning the motive of how someone who did not own anything expected to receive something in return.
“Even the prescription which they announced I am told on Thursday where they are saying now we want to account for all the proceeds. So if you know what the proceeds are then what? You are back to square one. So you know? Why don’t they know now? Why was this not in place? To be honest with you, the Governor is the same person who was there before,” Sichinga said, adding that he advocated for stopping the export of copper ore and suggested the creation of industrial clusters to produce finished copper products during the time he served as commerce minister.
He said the country could have enhanced the value of the exports if it used the money that was obtained from exporting the copper to create the finished product.
Sichinga said the moment the government proclaimed that they no longer own Konkola Copper Mines, despite the President swearing on several occasions to the contrary, they were saying goodbye to forex.
He said he would rather the country was in the BRICS right now given that China was the main destination for Zambia’s copper exports, because in Europe it was the corporations subsidiaries which sell the copper and by so doing keep the proceeds to themselves.
“And our government has given up and said ‘here Vedanta you can have it back.’ Has Vedanta brought back the money they said they will bring? Is it here? No! Were they not told that this is a waste of time? They were. But they will not listen because they think they know the solution,” Sichinga said, saying in the past the country used to have MEMACO which was involved in selling the copper and thereby the proceeds were coming back into the country.
He said President Hichilema recently claimed that for the first time the country had negotiated a 49 percent ownership in the mines, wondering which first time that was because when he served in ZCCM the government owned 68 percent of the shares.
“How can he say that? And yet his company is supposed to have valued Nchanga. How does he not know that? He chooses not to accept the truth,” Sichinga said.
He said until the leaders were honest to the country, this country was heading nowhere because the government and Bank of Zambia were prescribing the wrong prescription, saying without ownership of the mines, there would not be sufficient Dollars in the economy.
Sichinga said the open policy where the country said to everybody they could come in and have free foreign currency, means that foreigners were coming in with their currencies, converting the same into Kwacha in order to buy the Dollars, therefore no one should be surprised that the country had insufficient Dollars.
“And remember the other item that I said to you, this government says they want IMF, IMF. Why hasn’t the IMF given them solutions? If what IMF was prescribing is the solution, the panacea, why hasn’t it worked? What is $188million in the mining industry? How much is that worth? Not much. But that’s the solution they thought they had,” said Sichinga. “I would do it quite differently but I am not going to tell them what I would do because I am not part of the government. It’s not my responsibility.”
