Find us on Google+

Sunday, 10 April 2011

Is the MMD administration captured by mining companies?

Dr Haglund and many other commentators have no direct interest in the politics of Zambia. They base their recommendations on evidence. Ironically, even institutions such as the International Monetary Fund and the World Bank, which in the past were the usual scapegoats for policy inertia, are now all loudly criticising Zambia’s mining tax policy.

Despite all this criticism, Rupiah Banda’s MMD government is unmoved. After all, his focus and that of his government officials is on self aggrandisement and not to serve the people of Zambia. Rupiah and his friends are benefitting from mining because the mining corporations give them all sorts of personal favours – they bankroll their election campaigns. For this, they are ready to sell the taxes that are due to our people. This is criminal. This is corruption. This is what happens to a country when greed and selfishness reign supreme.
From today's Post Editorial on Mining Tax Policy, which touches on Dan Haglund's recently research on mining policy in Zambia - see his guest blog Policy Evolution in the Zambian sector.   The notion of "lobbying" as backdoor capture is something we will discuss in more detail in our monthly Leading Voice essay for May. The  other issue of campaign finance we have touched on - see the post At The Mercy of Business. There's a clear need to introduce stronger campaign finance reform. This does not require a constitutional amendment. A new bill can be passed like yesterday that would remove external capture by big business and foreign governments. Politicians unfortunately will not push for these reforms for reasons suggested by the Post. So individuals must agitate for them.  On a related point, we preparing another short essay "debunking the case for political funding" which will also touch on this issue, though from a different angle. We want reform in campaign finance, but that should be about rules not public funding which wastes the little money we have. Worth looking out for those two essays!

1 comment:

  1. Of course those crooks are bought and paid for by the mines !!

    Few examples

    windfall taxes scrapped

    Low mineral tax

    Tax evasion

    Glencore and FQM use transfer pricing thanks to their subsidiaries (Carlisa Investments & Skyblue Enterprise) based in tax havens and off-shore centers (British Virgin Islands )

    “...we believe that the related party sales and pricing mechanisms are not in accordance with the agreement disclosed, or arms length principle,” the audit report stated. “This should have impact on the tax assessment for the period under review.”

    The audit revealed that Glencore AG, the purchaser, determines prices and that some copper from Mopani is sold under an “old” contract with copper in one instance being sold at 25 per cent of official prices at LME.

    “The agreement is entered into with Glencore UK Limited, but the actual sale transactions disclosed are, as far as we have been able to verify with Glencore International AG,” the audit revealed. “The agreement mentioned is in fact an agent agreement, stating that Glencore is to operate as sole sales and marketing agent for Mopani. The sales are to be made at official LME London Metal Exchange copper grade settlement quotation averaged over the relevant quotation period plus premium or less a discount realisation charge for freight.”

    The audit revealed that despite Mopani selling copper grade +1 in consistency with LME prices, Glencore has consistently bought copper at prices below the market value.

    finance minister Musokotwane knew Mopani undervalued metal prices to evade taxes and what did he do ? Nothing...

    "The issue of tax evasion whose report the Zambian minister of finance and economic development, Dr Situmbeko Musokotwane, is said to have received last year, has not received any coverage in the state-owned media while the Post newspaper has given it some coverage. Zambian bloggers and netizens have played their part by putting meat to the bone."


    Moreover...

    During the last African Mines Ministers session in Cape Town, a contributor asked a question about FQM to the Zambian Mines Minister, Maxwell Mwale"FQM shows a huge undistributed profit in its accounts in respect of ZCCM's share in Kansanshi but has only received $20 million in dividends from the project, what is the Zambian Govt going to do about it ? " His reply was shocking - he said he knew of no undistributed profit in respect of ZCCM's stake and was very supportive of FQM who he said were the largest corporate taxpayers in Zambia (an old story which he must have learnt parrot fashion from FQM!!). Clearly FQM are looking after Mwale very well

    REMEMBER !


    Kansanshi Mining owes ZCCM-ih $ 400 million

    ZCCM-ih owes the govt $ 300million

    And the govt owes IMF $ 333 million and was only able to pay back $ 1,9 million...

    Those crooks must be kicked out


    Zambia needs change !!!

    ReplyDelete

All contributors should follow the basic principles of a productive dialogue: communicate their perspective, ask, comment, respond,and share information and knowledge, but do all this with a positive approach.

This is a friendly website. However, if you feel compelled to comment 'anonymously', you are strongly encouraged to state your location / adopt a unique nick name so that other commentators/readers do not confuse your comments with other individuals also commenting anonymously.