Printer Friendly

Web of intrigue over ZCCM privatization.

Anthony Kunda in Luanda reports on the extraordinary drama being played out in President Frederick Chiluba's government with the selling of Zambia's number one state asset, the Zambian Consolidated Copper Mines.

PRIVATISATION of Zambian Consolidated Copper Mines (ZCCM), the country's major foreign exchange earner, has sparked off a divisive controversy in the Movement for Multiparty Democracy (MMD) Government, resulting in the summary dismissal of two Deputy Ministers - Dr Mathias Mpande, Ministry of Mines, and Mr Ackson Sejani, Agriculture, Food and Fisheries.

Opinions are sharply divided over whether the mining conglomerate should be sold as a single unit, or broken down into smaller units. Dr Mpande, a reputed mining scholar, and Mr Sejani, have separately advocated ZCCM be privatised in small units to avoid any single investor scooping Zambia's prize company at a give away price. If sold separately, they say, it would realise much more revenue.

Mr Mpande charged that a group of prominent politicians and an unnamed business cartel were working towards taking control of the Zambian economy.

But other Government leaders, like Finance Minister Mr Ronald Penza, have strongly argued the case that ZCCM should be privatised in one piece. "Some mine units do not hold much prospects for investors," he said, "it will be difficult to sell these mines separately".

As the debate began to boil, Mr Enoch Kavindele, Chairman of the governing party's Finance Committee said, "we are not happy with Mr Mpande's sentiments because he is a Minister speaking in public against a policy before the final decision has been made by cabinet."

As if to confirm this attitude, in jumped President Frederick Chiluba, who fired both Dr Mpande and Mr Sejani for what he called "impropriety of office", adding that he would "not tolerate Ministers pursuing agenda which are at variance with those of the Government".

Nevertheless the two ex-deputy Ministers, seemingly undaunted by their sacking carried on with their offensive. Mr Mpande argued that, "Government has not yet announced any decision it made about ZCCM. If a position has not been made clear by Government, it follows that the nation should be allowed to debate its privatisation to protect democracy."

Bizarrely enough, hardly a week had passed before President Chiluba called a press conference and declared that ZCCM would not be privatised as a single unit after all. "We want to invite fresh investments into the conglomerate as a whole," he said.

To add to the confusion he mentioned that a group of experts from unnamed Government Ministries were still studying a report on ZCCM's privatisation written by a German business consultancy, Kielbaum, which is widely believed to have generated fierce debate within the Cabinet every time it was tabled for consideration. The report has valued ZCCM as a whole at US$2.2bn. The price tag would be US$1.5bn if copper prices remain at US$0.75 per pound weight. If future potential is excluded all together, ZCCM would be valued at US$557m.

But a reliable source within the Cabinet has informed African Business that the Kielbaum report has been secretly rejected by the Cabinet simply on the grounds that it's recommendations were too controversial. Sources in Government indicate that Chiluba is about to appoint yet another firm to do a study.

President Chiluba has formed his own committee on the ZCCM saga outside the Cabinet. It includes precisely those top executives of ZCCM who want it sold intact.

The whole process, if it can be dignified by that expression, suggests to many analysts that certain sections of the Chiluba Government are far from sincere. One might ask why, given President Chiluba's apparent reversal of his decision, those in support of selling the conglomerate as a whole, like Mr Penza and the ZCCM management, have not lost their jobs.

Opposition figures think there is much more to it than simple governmental protocol. Mr Benjamin Mibenge for example, General Secretary of the former ruling United National Independence Party, said "Dr Mpande and Mr Sejani are sacrificial lambs because other Ministers have committed graver offences and the President has been quiet about them."

Former President Kenneth Kaunda, was accused of overpaying cooper mine owners when he nationalised them. Now there seems to be a very real danger of the incumbent President accepting too little for them.
COPYRIGHT 1994 IC Publications Ltd.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1994 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Title Annotation:Zambian Consolidated Copper Mines Ltd.
Author:Kunda, Anthony
Publication:African Business
Date:Dec 1, 1994
Previous Article:CFA: the devaluation dividend.
Next Article:Is an economic crisis looming?

Related Articles
Selling off the nation?
Sluggish start to ZCCM sell off.
Privatisation to spur copper output.
Anglo-ZCCM deal'virtually in the bag.'.
ZCCM: A tale of heartbreak and tears.
$8lm to kickstart Zambia copper.
Zambia at big-league mining threshold. (Business briefs).
'Think again, Anglo,' says Anderson Mazoka. (Mining Notebook).
Zambia wants Anglo's mines. (Business Briefs).
Copper boom, new tax rules.

Terms of use | Privacy policy | Copyright © 2022 Farlex, Inc. | Feedback | For webmasters |