On Monday this week, a World Bank tribunal awarded almost US$6 billion as compensation to Barrick Gold and its copper mining partner, Antofagasta, after it was proved that Pakistan, where the two companies were operating, violated several provisions of its bilateral investment treaty.
Pakistan did not commit these violations last year or two years ago. This verdict comes after a seven-year battle over a gold and copper mine in that country. After the citizens had long forgotten about what their government did to the foreign investor, they woke up to the news that they would have to pay US$6 billion, as commanded by a World Bank tribunal.
Maybe Pakistan is too far. Let’s talk about what happened on the Copperbelt of neighbouring Democratic Republic of Congo (DRC). In 2011, Congo DR confiscated a Copper Mine owned by First Quantum Minerals in a manner that violated the investment agreement with the investor. Just like here in Zambia, a lot of Congolese mine workers celebrated the development, which obviously gave President Joseph Kabila’s government a lot of political mileage. But a few years later, after the dust had settled, FQM walked away with a US$1.2 billion compensation for the illegal takeover of their mine by the government.
Our newspaper believes, strongly, that Vedanta Resources abrogated the investment guidelines that were put in place at the time they took over Konkola Copper Mines. We agree with the workers at KCM, the mine suppliers and sub-contractors that Vedanta stopped caring for the needs of the local people. We further agree that they should indeed go, and government is in order to find a new investor to take over the mine.
We know that the manner in which Copperbelt residents are dependent on mining activities is such that if one man doesn’t get paid his wages or for the supply made to Konkola Copper Mine, a whole lot of people in the food chain suffer. It is justified that these mine workers and their unions are celebrating the chasing away of Vedanta, we understand their pain and frustrations. In Nsenga they say “nyamalila omukata lini kukamwa” meaning you must never gag a mourner, let them cry and let the pain out.
But we are concerned with the process that the government has used to pursue this need. We are worried because almost the whole Copperbelt mining community is applauding government for this hostile takeover of the mine from the parent company while ignoring the illegalities that surround the matter. We feel duty bound to remind not only the decision makers in government but also our brothers and sisters in Chingola, Chililabombwe, Kitwe and Nampundwe that they may win this battle but will eventually lose the war.
The reason we are citing examples from Congo and Pakistan is because these battles with foreign investors have been fought before, and where procedure for repossessing a mine has been breached, governments have paid through the nose. We are trying to urge citizens of this country to take keen interest in this matter because it may, whether they like it or not, affect them directly or indirectly.
Why do we say this? Look at what the Honourable Minister of Mines and Minerals Development Richard Musukwa said when he was asked why government was going ahead with the bidding process of Konkola Copper Mines when the liquidation case was still being challenged by Vedanta in court:
“We are very aware that the court processes are taking place. But we have a government to run, we have our people, we have our resources to protect and we cannot fold our arms waiting for a court process, which we respect, and in fact for your own information, even if they took us anywhere on earth, we will win the case, [except] that we are inclined to believe that our legal systems in Zambia are adequate to deal with the KCM issue and we enjoy jurisdiction,” said Honourable Musukwa.
With no fear or hesitation, the minister was speaking in front of cameras that government will not fold its hands and wait for a court process before it can sell Konkola Copper Mine to a new investor. In fact, he used a Bemba proverb “ifikala chimbwi tefikala inama iikata”, meaning government is not going to sit idle like a scavenging hyena waiting for the predator (which in this case is the court) to kill the prey (which is Vedanta).
Now, this is very careless talk coming from the minister and it gives reason to our fear that Zambia will end up paying Vedanta despite the Indian company being wrong in the first place. But the minister has the courage to speak like this because he knows that the Patriotic Front will not be in power when Zambians will be compensating Vedanta. By the time Vedanta will be having the last laugh, Honourable Musukwa will have collected his pension. It is the same people who are celebrating this takeover who will be forced to pay Vedanta, one way or another.
To Honourable Musukwa and his President, we say: stop getting overexcited about this matter because it is a multi-billion dollar dispute. If you have a good case against Vedanta, which we believe you do, take it easy. The copper which is underground in Chingola will not rot; it was there long before you were born and plenty of it will remain in the soil long after your death. There is no need to rush. Why the desperation to sell the mine? What is wrong in letting the court process pass first, since you are sure that you will win the case anyway?
Please don’t clothe us this foreseeable burden, which is being influenced by a few hungry stomachs! We already have enough problems on our hands.