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Saturday, 20 November 2010

Intellectual Poverty (David Mwanza)

This is a good example of it :
Konkola Copper Mines (KCM) says that Windfall taxes have the capacity to distort the country’s economy and suffocate mining companies.

KCM Board Member Jacob Mwanza says the taxes, if implemented, can only collect increased government revenue for a short period of time. Dr Mwanza says this revenue can distort the economy because it is money which is not budgeted for. He told a media briefing in Lusaka today that current mining taxes are adequate.

He added that the windfall taxes are not widely used in major copper producing countries such as Chile and Australia.
The intellectual poverty of the pro-low mining tax lobby has reached a new low. One does not have to be an economist to see why our Dr Mwanza is only a "Doctor of Philosophy" on paper. Are these these the people Musokotwane was referring to that are in touch with "modern economics"? This is a man who was at one point "Governor of BOZ" and Vice Chancellor of University of Zambia. Are you still wondering why we are poor with such "talent"?

5 comments:

  1. Considering that he is now on the board of KCM, why would anyone take his 'advice' on anything, let alone when it means that KCM pays fewer taxes.

    He knows who pays his salary.

    Also, dr. Musokotwane used to be a non-executive director of ZCCM-IH. Considering that he has no stake in ZCCM-IH receiving dividends, is it surprising he never asked for any? Or that he is now in the business of shielding the likes of KCM from paying taxes?

    This is complete government capture by foreign corporations, and it is a direct result of privatisation.

    I say that if they don't start paying dividends and taxes soon, we nationalize. And get some clawback for the billions that we've lost during this privatisation debacle.

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  2. I think this is more than intellectual poverty - it is simply bluntant hypocrisy from a very educated Zambian. I am no economist - but sure I cant understand how generating more income from the mines (on excessive profits they will make) will distort the economy - whose economy? - Zambia's Economy? Oh please give us a break!! He is probably refering to KCM's economy.

    I am pretty sure Dr. Mwanza understands very well that generating more resources for our country is not only morally right but it also makes economic sense to many poor people he is supposed to protect. He is supposed to be the brains helping us to develop systems that can collect more efficient taxes from the mines...but he has chosen to become a hypocrite,I think, because he has lost interest in helping our people; he has chosen to favour KCM who have enlisted him to be a board member - his mandate now is to make KCM as rich as possible at the expense of the Zambian people and he will say anything to confuse us so he can defend KCM's interests. Is this a form of corruption I wonder?

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  3. Chabu,

    he has chosen to favour KCM who have enlisted him to be a board member - his mandate now is to make KCM as rich as possible at the expense of the Zambian people and he will say anything to confuse us so he can defend KCM's interests. Is this a form of corruption I wonder?

    It is more than intellectual poverty - they are all bought and paid for.

    Check out this interview with dr. Musokotwane. "But the mines, they are paying taxes" - $50 million last year, from a $5 billion industry. ZCCM-IH also received dividends - $18 million out of $300 million.

    Situmbeko Musokotwane - Zambia's finance minister

    ABNDigital — March 08, 2010 — (www.abndigital.com) Copper rich Zambia was one of Africa's key resource-producing countries hard-hit by the global economic slowdown. But with copper prices on the rise, the country seems to be moving back into the territory of positive growth we saw in 2006/2007. Zambia is on the agenda of IMF chief, Dominique Strauss-Khan as he visits the continent this week. Fenly Foxen spoke to Zambia's finance minister Situm-beko Muso-kotwane about some of the challenges he faces in growing that economy.

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  4. I can NOT believe the audacity of some of our leaders, to stand up and attempt to feed us this nonsensical pish posh that wouldn't stand up to an econ 101 student's criticism.

    As long as we elect officials with little more than dollar signs between their ears we can expect the status quo to remain the same.

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  5. I wonder why some Zambians like to think inside the box? I feel a person with Jacob Mwanza's experience should be thinking more outside the box.

    Why can't the revenues from windfall taxes be used to finance most of the infrastructure projects prescribed in the 6th National Development Plan? Doesn't really make sense for us as a country to borrow collosal amounts of money to pave our road or even construct a new power station when we have access to productive assets in which we merely need to tax?

    Countrymen and women, we need to think beyond the small mining companies on whose boards we sit! we need to look out for the greater good of the people of Zambia!

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