On 13 September 2024, Hakainde Hichilema, the president of the Republic of Zambia, officially opened the Fourth Session of the Thirteenth National Assembly.
Key among the bills expected to be enacted during this session is the Minerals Regulation Commission Bill (the “Bill“), which is currently on Third Reading—where the Bill is reviewed in its final form and no debate takes place.
In the Bill, Zambia aims to establish a new regulator to oversee and regulate mineral-related activities and to ensure transparent and efficient management of mineral resources.
However, the Bill has prompted concerns in the mining industry about its potential to hinder mining investment in Zambia. Two industry bodies, the Association of Zambian Mineral Exploration Companies and the Zambia Chamber of Mines, have issued a joint statement calling for amendments to the bill, as the bill in its current form will revert Zambia to “long-term policy instability and mining investment stagnation,” as well as “drive up the perception of investment risk in Zambia,” according to the statement.
Under the current proposals, the Bill will enable the state to “acquire” an interest in an exploration license before the license is granted to a private party. If viable mineral deposits are identified and the private party converts the exploration license into a mining license, the state will retain its interest.
In addition to the rights over exploration licenses, the Bill will also empower the Minister of Finance to “acquire” mining rights for investment by the government over “identified areas.” These “identified areas” will essentially be reserved for investment by the state and won’t be subject to the normal application process to acquire the rights.
Zambia’s move to amend its mining regulations seems to mirror developments in other African countries, like Botswana, which has also recently proposed a mining law amendment. Under Botswana’s current mining law, the government has the option to acquire a 15% shareholding in any mining project upon the granting of a license. The proposed amendment aims to increase local ownership in mining projects. Suppose the government chooses not to exercise its option to acquire the shareholding. In that case, the mining companies will reportedly be required to use their “best endeavours” to dispose of 24% to citizens or citizen-owned companies.
African governments seem to want to increase ownership and local participation in mining.
Recent developments in the mining sector
On August 29, 2024, Zambia’s Minister of Mines and Mineral Development, Paul Kabuswe, officially launched two key blueprints to harness Zambia’s potential in the mining sector. These are the National 3,000,000 tonnes of Copper Production Strategy by 2031 and the National Critical Minerals Strategy, 2024 to 2028.
Among the goals of the copper production strategy is to increase copper output to 3 million tonnes per annum by 2030 from the current 800,000 tonnes, while the Critical Minerals Strategy aims to balance geopolitical interests with local impacts, ensuring that the benefits of mineral exploitation reach underserved communities.
In the same month, Zambia, which is Africa’s second-largest copper producer, launched a nationwide high-resolution aerial geophysical survey to map the country’s mineral and water resources. The program is part of the country’s target of quadrupling annualised copper production to achieve 3 million metric tonnes by 2031.
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