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Monday, 10 January 2011

The Treason of Nawakwi

Nawakwi said when the government sold the mines; the price of copper was hovering around US$2,900. She said when she argued that the price was too low; the buyers said it was uneconomical for anyone at that time to invest into the Zambian economy, saying that was why the mines were sold for a song. Nawakwi said the buyers projected that in their lifetime of 15-20 years, the price of copper would not go beyond US$3,000.

“That is how the story of windfall tax came in, ‘what would happen if their theory was proved to be wrong’? And all concerned said ‘let’s exploit the concept of sharing the profit unexpected at the time of the sale’,” Nawakwi said. “Truly it has come to pass that the dip in copper prices was temporary. The price of copper has grown by over 100 per cent. What is in it now is not the royalty because the royalty was fixed. You can increase it by 10 per cent, it is nothing compared to the opportunity cost of a Zambian not owning a mine.”
Edith Nawakwi once again defending her role in the selling of the mines. When is Hon Nawakwi going to apologise to the Zambian people for falling under the spell of IMF undergraduate economists? Her story has never made sense to me. She said exactly the same thing in 2007. My position has not changed. Everytime ordinary Zambians start fighting for greater mining revenue she appears from no where as a pro-poor champion. There's no Zambian finance minister who has done more to sell our people to the yoke of poverty than Edith Nawakwi. She has never come clean. Infact Nawakwi knew where all the Development Agreements were buried but she never said a word! It took academics to unleash the documents on the world. She needs to start every sentence on this issue, with "I am sorry for my incompetence when I was Finance Minister........"

1 comment:

  1. Cho,

    You have to wonder two things though.

    1) How much power and independence did Edith Nawakwi actually have during the 1990s, in Frederick Chiluba's cabinet.

    2) If she had suggested a windfall tax when the development agreements were drawn up, would have it been put in? Or would she have been fired if she'd insisted. I don't know how much independence a finance minister has in Chiluba's cabinet.

    Also on an asside note. I am still blown away by the fact that the Rotschild family bank (NM Rotschild & Sons) did the privatisation of the Zambian mining sector, through the privatisation of the state owned mining monopoly, ZCCM. The plan was literally called the NMR Report.

    (Press Release by the Zambian Minister of Finance Sale and Purchase Agreement signed on ZCCM's Konkola North Mining Prospect

    Upon the successful conclusion of Stage I of the Privatisation Process and the commencement of Stage II - as described in the Phase I Privatisation Report for ZCCM, dated April 1996, prepared by NM Rothschild & Sons ("the NMR report"))

    Rothschild was also behind the original colonisatsion, as the backers of Cecil Rhodes' BSAC or British South Africa Company. You can argue that Anglo-American De Beers is also a Rothschild company or extremely closely allied to them (AADB heir Jonathan Oppenheimer worked as an analyst at NM Rothschild & Sons, and Rothshild heir Evelyn de Rothschild worked as a director at De Beers, for instance). Also, Rothschild has controlled Rio Tinto mining company since the late 19th century.

    And right now I am wondering - is this why there is no movement on the windfall tax? Is this why there is so much secrecy about the mining sector, the mining 'development agreements', etc?

    ReplyDelete

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