State-owned Times of Zambia reports that China has written off more than US $22 million of debt owed by the African Copper mining giant, as talks escalate that the recently ‘nationalised’ Konkola Copper Mines (KCM) Plc will be taken over by a Chinese mining parastatal.
On Monday, another State-controlled newspaper, the Zambia Daily Mail, ran with a lead headline “CHINA MINE EYES KCM…We are able, says Non-Ferrous Metal Mining group”, thereby, confirmed existing negotiations by the Zambian government for a possible Chinese takeover of the repossessed Vedanta-owned multi-million dollar asset.
“China has given Zambia another grant amounting to US $30 million towards support to various projects of development to accelerate industrialisation and job creation,” further reports Smart Eagles, a State House-funded social media outfit in Zambia.
The Zambian government has been negotiating a debt swap with China to offset its outgrown loan repayment obligation, which has threatened the country’s foreign reserves into a total collapse, at just over US$1.4 billion, representing 1.7 months of import cover.
While government has invited interested investors into negotiations for a buyout of KCM, under liquidation, all eyes are in China where a high-powered Zambian delegation is making headways in sealing off industry-based economic deals and debt cancellations.
“Today, we are signing this debt cancellation because we are keen to see Zambia grow from strength to strength and we shall do what we can to support Zambia’s development agenda,” Chinese Foreign Affairs Minister Wang Yi said on Monday, as he addressed a Zambian delegation led by his counterpart Joe Malanji.
He was speaking during the signing ceremony for economic agreements and debt cancellation at Diaoyutai Hotel between deputy director of China International Development Cooperation Agency Zhou Liujun, who signed for China, while Malanji who signed on behalf of Zambia, witnessed by Zambia’s Ambassador to China Winnie Chibesakunda.
Wang said China’s offer of a grant of US $30 million (200 million yuan) was coming in view of further developing the “friendly relations.”
Sources tell News Diggers!, however, that government is considering China, more than anyone else, to take over KCM, as that would help government in restructuring its debt with the Asian superpower.
But the mining community in Chingola is averse to the idea of handing KCM to the Chinese, a situation which may result in protests among the labour force.