CORRUPTION HITS MINES
Genuine companies supplying goods and services to Mopani copper mines (MCM) are reportedly collapsing because of alleged corrupt cartels in the business, according to the sources.
The sources highlighted massive corruption in the procurement of goods and services in the private sector, in particular, the mining companies where it said to be rife.
The source said it was heartbreaking to see what had happened to so many companies hoping to build their business out of genuine supply to mines.
“One mining company where corruption has hit alarming and shocking levels is the Glencore owned Mopani copper mines,” he revealed. He noted that the individuals had been practicing the vice for a long time such that they had become so skilled in the practice of corruption at the mine and they had even formed cartels. He said the greed and selfishness of a few corrupt people deprived many local companies from participating fairly and equally in the supply of goods and services.
“We are aware of buyers that are demanding as much as 10 percent of the order value and they are so arrogant to the extent that they would tell you that if you do not have it you must tell them so they give the order to someone,” he said.
He said it was a huge cost to the mine because prices were being inflated in order to cover the kickbacks that they had to pay out. As a result, production costs appeared to be extremely high, copper prices tumbled and companies failed to cope. Yet, other companies strongly dealing with this vice thrived.
“Companies that refused to be part of the corrupt scheme were gradually being Side-lined from receiving requests for quotation (rfq). The buyers in collusion with end-users would select which companies to send an rfq for particular requirements and they know which firms would quote inflated prices,” he said.
He explained that items were now being procured directly from foreign companies because of exaggerated pricing and yet the country complained that local companies were being sidelined.