Reuters report that massive new Chinese investments are on the way to the recently created 'economic investment zone' around Chambishi. The zone was announced as one of a small number of such projects being established by China across Africa at the Sino-African summit earlier this year. It is scheduled to start operating next year and Reuters reports claims it will attract US$900 million in new investments in mining, smelting and, significantly, manufacturing. An official (it doesn't say Zambian or Chinese) reports that the investment will generate a massive 60,000 jobs.
Alongside that, University of Zambia economist Dr Francis Chigunta argues in The Post that on the back of high copper prices Zambia will hit the Government's prediction for the year of 7% GDP growth .
One might, then, have expected the Government to be crowing. However, a couple of signals suggest that both the President and Finance Minister are increasingly aware that growth has thus far been relatively jobless and has had a limited, occasionally negative, impact on Zambian workers and communities.
Chinese investment on the Copperbelt has been extremely controversial, and the offer of further tax concessions in the economic zones raised fears about the state's willingness to offer Chinese firms the right to operate outside normal legal constraints. No-one has ever been prosecuted following incidents when protesting miners were shot in Chambishi last year, or when workers were killed in an industrial accident at a Chinese explosives factory. Reuters report however that President Mwanawasa publicly recognised the problems in the current relationship, telling Luo Tao, the head of China Nonferrous Metal Mining Group Company Limited (CNMC), which owns NFC-A's Chambishi mine, "I want to assure you that we will continue supporting your investments in Zambia. But when incidents of Zambians being disadvantaged come to the fore, we will find it difficult to defend your record." Reuters continue, "Mwanawasa said he was happy with assurances by CNMC to adhere to Zambian labour laws and safety standards at Chambishi mine." The For Whom the Windfalls? report suggests that, at least at the end of 2006, in terms of labour law, safety standards and immigration law, this was not the case. Any investment agreements made with new investors should be subject to public scrutiny to ensure that this situation does not repeat itself.
Another article in The Post reports that Finance Minister, "Magande said he sometimes felt ashamed to face Zambians because of poverty... Magande said it would be difficult for the ordinary Zambian to feel the impact of the economic growth if the monies in various ministries were not used properly. He said although the country had reached a single digit inflation rate, people on the ground were still poor... Magande said even if the government increased the tax base in the mining sector as proposed by some stakeholders, it would still be difficult to improve people’s lives unless the financial monitoring system was improved."
"Even if"? I thought there was supposed to be a team working on this renegotiation! Well, I am sure there is, but... well, we'll see.
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