ACTING Mines Minister Collins Nzovu has disclosed that Cabinet has resolved to create a Special Purpose Vehicle (SPV) called Zambia Minerals Investment Corporation, which will represent government’s interests in mining.
Addressing the National Assembly on Friday, Nzovu said the SPV would extend government’s benefits from the mining sector beyond taxation.
Nzovu was responding to Lubansenshi MP Kabwe Chewe, who had asked whether government had any plans to establish state-owned mines.
“Government has no plans to open state owned mines, however, government’s intention is to create a Special Purpose Vehicle, an SPV that will partner with the private sector by entering into joint ventures in running these mines. Madam Speaker, under the joint venture arrangement involving the SPV, the number of mines can only be established at an appropriate time. As earlier stated, government has no plans to open state owned mines other than through the SPV. Therefore, at this point in time, it will not be appropriate to state in which districts these mines will be opened,” he said.
In a follow-up question, Chewe wanted to find out what was stopping government from owning mines, but in response Nzovu disclosed that it had settled for an SPV.
“In summary, in answering his question I can simply state that the way government is going actually what is happening is that you are creating this special purpose vehicle so that you do not only get revenue from taxing but from production itself. Remember that in the mining sector, I think it has always been very very difficult to get revenue from taxes because of certain things which companies do. But we want to be part of the entities which are going to be mining, so we will be partners through this SPV. And Madam Speaker, I want to state here very very clearly that Cabinet has sat and made a decision that a SPV called Zambia Minerals Investment Corporation will be formed and this will represent government’s interest in a very very big way,” said Nzovu.
“Gone are the times where we will look at this mineral resource and get small dividends from it. This is the time Madam Speaker, and I want to agree with the member of parliament on his initial statement that this natural capital we have which may finish soon, Zambians, the government itself must get a big share. And through the creation of this SPV this is exactly what we are going to do. Remember also that we will be an active player, not only on the benefit sharing but we will also want to be very strong in value addition. Most of what we want to see, the direction we want to take the mining sector will be done very very clear through this SPV”.
