ZAMBIA: Bishops Propose Abolition of Tax Holidays on Mining, Multinationals toward Economic Turnaround

By Arnold Neliba

LUSAKA, NOVEMBER 15, 2023 (CISA)-While appreciating the goodwill of the government to restructure the economy to create an enabling environment for the development of the country, Catholic Bishops in Zambia are calling on the state to review mining concessions and tax holidays given to multinational corporations.

According to the bishops, mining in Zambia contributes little to the economy than it should, thus the call for the enactment of measures similar to those in Botswana, Chile and other mineral-rich countries.

“Due to the increasing use of technology, mining employs significantly lower numbers of people today than it did in earlier decades. As a result, the most assured way of deriving maximum benefits from this vital industry is through effective tax and shareholding policies,” reads a statement by the Zambia Catholic Bishops Conference (ZCBC) released on  November 10 after a plenary in Lusaka.

In its efforts to restructure the national debt, the bishops have appealed to President Hakainde Hichilema and the government to be transparent in the process.

“We demand full disclosure of all bilateral and multilateral agreements as well as transparency in the publication of mining agreements with investors so that the Zambian people know what their public leaders are signing on their behalf,” they stated.

These new approaches, they say, will help increase public revenue and help alleviate poverty among Zambians who are already facing the heat of high cost of living.

“Both the exchange rate and inflation have risen considerably in recent months and these trends are adversely affecting the economy. Consequently, the cost of living and doing business has escalated,” the prelates observed.

In the manufacturing sector, the bishops have urged the government to identify priority areas and take concrete steps that would support its development. They say, “The establishment of manufacturing industries can create employment in value chain addition. Products and services from these industries can bring the much-needed foreign exchange and consequently strengthen our local currency to other convertible currencies.”

According to the International Trade Administration, Zambia is Africa’s second-biggest copper producer, accounting for 70 percent of the continent’s total copper output.

As of 2019, Zambia was the seventh largest copper producer in the world, generating 790,000 MT of red metal that year. Copper represents 60 percent of the country’s total exports. The country is also home to small, exploitable deposits of cobalt, nickel, and manganese.