Evil mining firms won’t blackmail govt, we’ll deal with them – Musukwa

Mines Minister Richard Musukwa has warned that government will not be stopped from implementing the new tax regime by mining houses threatening job cuts in the extractive sector.

And Musukwa has called on trade unions in the country to be vigilant and work with government in ensuring that the “evil” mining houses are put in their place, insisting that Zambian resources belong only to Zambians.

In an interview with News Diggers!, Musukwa said he was aware that some “evil” mining houses had for a long time been scheming to blackmail government by threatening to prune Zambian employees if it effected the proposed tax changes.

But Musukwa said the mining houses should start by pruning expatriates if their operational cost challenges were genuine, saying sending away expatriates would be a good cost-saving measure because they were the highly paid, compared to Zambian employees.

“The schemes being postulated by mining houses are arm-twisting tactics, something they cannot do in their home countries. But we will not allow situations where mining houses start dictating what type of taxes we should have! Imagine having a country where we can have foreigners telling us how we should tax them? When they come here, they come under a guise of investors and enjoy a lot of concession and holidays. In fact, at the time when they have to start paying taxes, most of them wind up operations, they would have already made huge profits! So, what government would like to do in these new tax measures is to ensure that we seal transfer pricing, tax avoidance, which have been perpetuated by these multinational companies,” Musukwa said.

“What they need to do before they prune any Zambians is that they should prune all expatriates. That’s the first saving measure they should do, so that we remain with Zambians who are able to run and operate these mines. In most cases, these so-called expatriates are people that have just been learning from Zambians! They have been here and in the process they have frustrated our highly-trained and competent Zambians to run and manage the affairs of our country. Actually, these expatriates are some of the highest paid in the mining companies, one expatriate can even pay 50 Zambians. So, that is the first option they should consider in terms of cost-saving measures. And in today’s modern age of computers and Internet, they are able to even manage the company outside the country,” Musukwa explained.

He noted that the reasons being advanced by the mining houses intending to cut down on their workforce were not justifiable.

“Mining operations are such that they are operated at an international platform, and at an international platform, mining anchors on the commodity price. As we sit today, the commodity price of copper is stable. In the mining industry, a time where we get to hear of suspension of operations, job cuts, is when the copper price goes down. The copper price has not gone down at the international platform to warrant these actions by these mining houses. These are actions that are meant to ensure that they cripple government, but we will not entertain that! In 1964, we fought for political independence, but time has come for Zambia to fight for economic independence from these multinational companies that want to hold us to ransom,” Musukwa said.

“These multinational companies are here to ensure that they make maximum profit on behalf of their shareholders. But the PF, here, is in government at the pleasure of Zambians. Those foreigners don’t vote, the people who vote for us are Zambians and we owe it to them. That’s why we want to ensure that we reduce the burden on Zambians by taxing mining houses, which must contribute significantly to development. How come for so many years poor Zambians have been subsidizing these mining companies in terms of power and other services? We will not! It is time for our people to get relieved by ensuring that multinational companies, which operate in Zambia and exploit our resources are taxed fairly. In our quest to tax mining companies, we will not tax them out of business, we will ensure that there is fair return on their investment.”

Musukwa further called on workers’ unions in the mining sector to help government put non-compliant mining houses in their place.

“They are used to arm-twisting, we are aware that the last time they arm-twisted government, government changed and gave them what they were expecting, and this is what they are expecting us to do. But sorry, we will not do that. Those who want to come to the table must come with clean hands and those who have genuine concerns over their operations on our tax regime, they must present their issues to the Ministry of Finance. Government is open to candid, critical and friendly discussions than the blackmail, which we are seeing here…In fact, what I can tell you is that these evil mining houses have been for a long time been planning to declare our people redundant and they have just found an opportunity,” argued Musukwa.

“How can you account for someone to write a pruning letter to our people even before the (2019) budget is implemented? This is how evil they have been scheming for a long time to declare our people redundant! We, therefore, are calling on the trade unions to be vigilant and ensure that these mining houses are put in their place because these are resources for our workers and they should not just wake up and decide what they want to do!”

         

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