Pro Saasa counsels govt on maximising benefits from mining sector

GOVERNMENTS must first understand the impact of mining to ensure it maximises its influence on benefiting ordinary Zambians, according to Premier Consult, lead economist, Oliver Saasa.

According to Professor Saasa, the effects of direct employment as a result of investment in a mine extended far beyond the employees or contractors who were hired.

He explained that understanding that the contribution of the country’s most strategic sector, which was mining, did not stop at the treasury, but extended to direct benefits to ordinary people.

The sector, Professor Saasa stated, accounted for over 70 percent of foreign exchange receipts.

“If we want to maximise the impact of mining for the benefit of the ordinary Zambian, the first step is understanding the impact of mining. You see, the value of mining is not just determined by the quantity of taxes acquired from the mining sector.

On multiplier effects for the industry players, Professor Saasa said there were two broad groups into which they could be categorised.

First, he said, there were multiplier effects that stemmed from interdependencies between productive sectors of the economy.

He explained that these inter-industry effects arose out of extra demand for domestically-produced goods or services from, for instance, the Enterprise Nickel Project.

“This then leads to an increase in demand for raw materials, or other goods and services. Growing demand for goods or services then triggers increased production by suppliers. Multiplier effects due to production linkages like these are considered “indirect multiplier effects,” Professor Saasa said.

He said the second group of multiplier effect related to increases in incomes paid to employees and contractors, which extended to communities or households.