Lack of Geological Information on Mining Reserves Depriving Zambia of Maximum Benefits

The Centre for Trade Policy and Development (CTPD) says lack of geological information about Zambia’s mining reserves is affecting the country’s ability to negotiate better deals with mining companies.

CTPD Senior Researcher Extractives Webby Banda said that even when the deals are negotiated, mining companies have complete monopoly of geological information.

Banda said that although some mining companies may deposit geological information with the Geological Survey Department, there is no mechanism of establishing the authenticity of the deposited information.

He has since called for the need to widen the funding base by apportioning a percentage of mineral royalty to the process of undertaking geological mapping if Zambia is to achieve maximum benefit from its mineral resources.

“Although government can be commended for having promised to increase the budget allocation to generation of geological information in the 2020 budget, there is need to widen the funding base by apportioning a percentage of mineral royalty to the process of undertaking geological mapping,” Banda said.

Banda also stressed that lack of an excess profit tax instrument in the current regime is not inspiring confidence for the country as there is no guarantee of government achieving an appropriate share of mining revenue in high price cycles.

He said Zambia needs to maintain stability in its mining fiscal policy if it is to attract foreign direct investment.

“Zambia seems to be at a stretch in achieving this. In the past five years, the copper taxation regime has been structurally reformed four times going against good standards of taxation. In principle, it is demanded that a fiscal regime ought to be predictable and stable to help mining companies undertake fiscal planning,” He said.

The post Lack of Geological Information on Mining Reserves Depriving Zambia of Maximum Benefits appeared first on Zambia Reports.

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