Chief government spokesperson Dora Siliya says the liquidation of Konkola Copper Mines has nothing to do with winding up the company or the sale of its assets, but ending the business relationship with Vedanta Resources that owns 79 per cent shares in the mine.
And Siliya, the information and broadcasting services minister, has confirmed that Konkola Copper Mines (KCM) has no money to pay salaries for its workers and is relying on government for help.
In spite of the ongoing court process where the liquidation has been challenged, the minister said during her weekly briefing, Thursday, that KCM would remain intact, with its assets, while government looks for a new partner to take over the majority stake held by Vedanta.
“If government made a decision to put the company into liquidation, the company is still existing as at this point and the assets of KCM are still existing. It’s the mine itself which belongs to the people of Zambia. So what government is looking for is that in the company arrangement where Vedanta had 79 per cent shares I think…and government had 20 something shares, government now is saying that those shares that belonged to Vedanta, we want another partner. We don’t want these… because this asset belongs to the people of Zambia,” Siliya said
“But to operationalise it, there was a special purpose vehicle called KCM created, which involved ZCCM-IH and Vedanta. But government is saying this arrangement, we want to liquidate it. We are not liquidating the company, the company is operating as a going concern right now.”
She said she was aware that people associated liquidation with winding up a company and selling assets but “this is not what is happening here” regarding KCM.
“What is happening is winding [up] a relationship; a business and commercial relationship between ZCCM-IH and Vedanta, not the mine. Because that is why we are looking for a new partner to continue to run the mine with us. We want the mine to continue operating because that is the only way we are going to benefit as Zambians, first of all the people who work there and then the rest of the country,” Siliya said.
When asked how transparent the government had been in the process, the minister who also serves as Petauke Central member of parliament said the question that must be asked, instead, is how open Vedanta had been to the people of Zambia during the time it operated KCM.
“We are the ones disputing this relationship with Vedanta. The question should be how open has Vedanta been with the people of Zambia? Because the people of Zambia own that asset. And the people of Zambia have been expecting that money is being made from Vedanta, so the people of Zambia are expecting that there should be money there, right? If it is not there, you should be asking Vedanta that how open have you been with the people of Zambia? That is why we are disputing the relationship,” Siliya said.
On revelations by News Diggers! in its edition of yesterday that KCM was struggling to pay salaries to its workers, Siliya agreed and said financial problems at the mine were among reasons the government decided to take over.
“And when people say KCM has not paid salaries for June, that was the very reason that this mine was put into liquidation because clearly if it was doing well, why is there no money in the account to pay salaries? That actually proves the point that this asset of Zambia, KCM, which is the biggest mine in Zambia…the fact that there is no money in the account there and yet copper was being sold every day, but there is no money in an account to pay the salaries of the staff who are working at KCM, that is the very reason government took it over. So it [the takeover] can assist the staff and the mine to continue operating,” she said.
“But sometimes we reduce everything to politicking, so we have to see through all this noise and say ‘what is really going on?’ Because if the mine was doing so well, there should be money sitting in an account so that the liquidator will just take that money and pay the salaries. But the fact is that that money is not there and government is looking for this money to be able to pay the workers. And these workers are Zambians, they also want to buy mealie meal, they want their children to continue to go to school, they want to pay for their funerals, they want to pay for their medicals.”
Siliya said the fact that the government was the one now trying to find a new partner to run KCM was a reflection that there was a problem at KCM.
“…and that even gives us much more resolve to address the problem so that we can actually find a partner that is willing to invest correctly so that we just don’t pay salaries but we also get a dividend to invest in other sectors of the economy… As of now, that process has not come to an end. All this speculation about ‘it’s going to Chinese, or it won’t be going to Chinese’, I think that is all speculation. Let us allow this matter to get to a logical conclusion. What we want as a government is that this mine should continue as a going concern, that the workers there should have jobs, that the workers there, even as they wait, we want for a new partner, that they must also continue getting paid,” Siliya said.