Zambian Economist blog discusses MFEZ

'Cho' recently wrote interestingly on the Zambian economist blog on the proposed tax free economic zone at Chambishi. He asks particularly whether Zambia is getting enough in the way of infrastructure development out of the new companies. His posting created a lively discussion that can be viewed by clicking on the 'comments' tab at the botttom of the original post.

"In terms of value for money, the real question is whether new economic activity generated by the Chambishi zone would more than compensate the government for revenue lost from tax-breaks and expenditure on new infrastructure. The economic analysis underpinning the Chambishi zone deal needs to be made available so that we can check whether this question has been addressed (we are still suffering from mining DAs). A key element of the analysis is the issue of what would happen if the tax - breaks and concessions are not made? Would Zambia get the investment anyway from other players? The government analysis presumably has also factored in the costs of displacement for those that have lost the land. What are these costs?"

He concludes, "It strikes me that we have moved from abandoning development agreements on the mines (with their zero taxes!) to creating new ones with the economic zones."

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