Zambia has a lot to offer investors - despite an ongoing brawl between the country and mining giant Vedanta Resources.
According to minister of mining, Richard Musukwa, Zambia is open for business and is actively seeking investors in the mining and minerals sector.
But, he warned, it was a jurisdiction of laws and regulations that should not be messed with, referring to his government's provisional liquidation of the Konkola Copper Mines (KCM) for failure to pay dividends.
State-owned Zambian Consolidated Copper Mines (ZCCM) owns 20.6% of KCM, while Vedanta Resources owns 79.4%.
“We offer a stable platform for serious investors that see Zambia as an opportunity,” he said. “But, we will not entertain bogus investors.”
He said in the case of Vedanta Resources, the country was dealing with an investor that had broken the law. The company had also last produced copper in 2014.
“Zambia is a victim and it needs support. Vedanta Resources pledged to put in $300 million, they further pledged $500m and another $250m and they did not bring that money. What do you want the Zambian government to do?”
Vedanta has been embroiled in litigation with the Zambian government in an effort to regain KCM, but Musukwa said it was time the company accepted the loss and moved on.
Zambia was also looking for a new equity partner to take over the asset, he said.
The liquidator had opened up production again, he added. “There is huge indebtedness to contractors and suppliers. We have started to pay these companies and people. The fact remains that there are resources locked up in this investment that was going nowhere.”
He said investors not willing to conduct themselves within the ambit of the law were best suited to find opportunity outside of the continent. “Just because we are African should we watch you break the law?”
Musukwa maintained that its ongoing dispute with Vedanta Resources, however, should not scare off other investors as there was ample example of many multinational companies operating without problems in the country.
