Africa-Press – Zambia. Government has justified Zambia Consolidated Copper Mines Investment Holdings -ZCCM-IH- decision to enter into a transaction with First Quantum Minerals-FQM- to convert its dividend rights and economic value in its 20 percent equity in Kansanshi Mining Plc into a life of mine royalty.
According to the transaction details, ZCCM-IH agreed to enter into an agreement and drop criminal charges against Kansanshi Copper Mine Directors, as part of the conditions precedent for FQM to declare a dividend in the sum of the amount that government had been claiming from the mining giant.
Addressing the media in Lusaka this morning, Finance and National Planning Minister Situmbeko Musokotwane said the mineral royalty tax model entered into with Kansanshi in place of a dividend model for shares is based on profit, and will enable the country get revenue from mining operations even when profit has not been made.
He has maintained that contrary to assertions, the government through ZCCM investment holdings has not sold its shares in Kansanshi mine and in addition to the new model, government will continue collecting other taxes and that negotiations that culminated into the latest changes started about three years ago. And ZCCM-IH Board Chairperson Dolika Banda has expressed confidence that the new model will help to improve the operations of the institution.
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