You have to marvel at the idiocy of mankind. Especially those whose livelihood depends on favour of the vox populi. In April, Zambian politicians were forced into a humiliating backtrack on some outrageous royalty tax increases they were forcing through Parliament. Now they’re refusing to heed the lessons of the country’s disastrous nationalisation experiment by threatening to withdraw the mining licence of a Chinese copper producer which has laid off staff in an effort to remain profitable. It will introduce a sense of deja vu for those who follow Zambia. Copper has been the country’s major export ever since it was first mined in the 1930s. Five years after Zambia became independent in 1964, the government nationalised the two highly successful copper producers. What followed, as happens when you remove the disciplines of a market-based business model, was a progressive slide in annual production from 750 000 tons to 250 000 tons and a two thirds loss in jobs, from total employment of 60 000 to just over 20 000 (see graphs below from an article by D. Limpitlaw in the journal of the SA Institute of Mining and Metallurgy). Those who don’t read history are likely to repeat its mistakes. – Alec Hogg  Â
- LUSAKA, Sept 13 (Reuters) – Zambia will revoke the licence of China’s CNMC Luanshya Copper Mines if the company does not reinstate workers sent on forced leave due to falling copper prices and power supply shortages, a government spokesman said on Sunday.
CNMC Luanshya said last Monday it had arrived at the decision after considering the rising cost structure for its Baluba Mine owing to the weaker copper price and the energy crisis bedevilling Africa’s second largest producer of the metal.
On Sunday spokesman Chishimba Kambwili said the government would not accept any job losses as a result of the power shortage and had told CNMC Luanshya to rescind its decision.
Read also:Â Capitalism 101 lesson for Zambia, DRC as Glencore kills their copper goose
“If they don’t comply we will revoke their licence,” Kambwili said on state-owned ZNBC TV. “Every investor who comes to Zambia must respect the law of the land.”
The Mineworkers Union of Zambia (MUZ) says about 1,600 members were affected by the decision.
On Saturday MUZ President Nkole Chishimba said the union was challenging CNMC Luanshya’s decision, which it alleged was made without consultating labour unions.
Glencore/Mopani stopping copper production in #Zambia: really bad news for the country!
— James Thornton (@UKThornton) September 7, 2015
Another miner, Glencore’s Zambian subsidiary Mopani Copper Mines, is in talks with the government and unions over plans to suspend its production, but a source close to the company said on Friday most workers would be retained.
