EAZ bemoans ‘misleading’ KCM media reports
WE should examine the context of the intervention on KCM because much of the media coverage has painted a misleading picture of what’s at stake and the history leading up to this juncture, Economic Association of Zambia (EAZ) Copperbelt Chapter chairperson Matthews Muyembe has said.
Mr Muyembe said Government’s decision to unwind KCM and effectively remove Vedanta from the country marks the culmination of years of abuse and reckless behaviour by the Indian mining firm.
He said the liquidation petition initiated by ZCCM-IH, the state’s copper investments holding company and minority shareholder of KCM, was a direct and legally sanctioned response to KCM’s latest breaches of its mining licence.
Mr Muyembe said when facing a dilemma of two imperfect options, the rational choice would be to select the least harmful course of action, the option with the best chance of yielding a positive outcome for the future.
“It’s through this idea, the principle of lesser evil, that we should view and understand the recent decision by the Government of Zambia to intervene and liquidate Konkola Copper Mines (KCM), effectively inviting the troubled foreign investor Vedanta Resources to pack up and leave the country,” he said.
Mr Muyembe said the particular violation that precipitated the liquidation action was KCM’s failure to pay its adjusted mining tax and mineral royalty obligations, as mandated by the new mining tax system that went into force earlier this year.
In addition to failing to comply with adjusted fiscal obligations, KCM has intentionally sought ways to subvert them too. Some international observers have found that Vedanta-owned KCM systematically evaded tax and royalty payments through a process known as transfer mispricing,” he said.