Zambia needs a more competitive mining tax regime to entice new and existing investors to invest billions of dollars in the mining industry and boost flagging production, says the nation’s largest taxpayer, First Quantum Minerals (FQM).
FQM Head of Government Affairs John Gladston said at the 9th Zambia International Mining and Energy Conference and Exhibition in Lusaka, “government and the private sector should seek to create a framework in which a modern, progressive, developing commodity-based economy can be built, a scenario where investors vie to invest in Zambia”.
Mr. Gladston noted that Zambia is hugely rich in natural resources and deserve to benefit from those resources, which can be done by attracting foreign direct investment.
He noted that with the right tax regime, FDI will come, but Zambia must compete against other jurisdictions.
Mr. Gladston was speaking during a panel discussion on “establishing mutually beneficial fiscal regimes” at the industry conference, which was held under the theme “Creating an attractive investment framework to catalyse Zambia’s mining and energy sectors”.
He said that Zambia’s current mining tax regime poses a range of difficulties to the sector making it unattractive to potential investors when put alongside other copper mining countries.
Mr. Gladston said Zambian miners this year face the highest copper mining tax regime globally which may well challenge economic viability of some of Zambia’s existing mining operations.
Speaking at the same event, Minister of Mines and Mineral Development Richard Musukwa said mining is key to achieving economic diversification through enhanced local content.
Taxes paid by First Quantum Minerals in Zambia now amount to more than US$3.85 billion, plus investment in community development projects of US$100 million, delivering tangible social improvement to thousands of Zambians.