Zambia has announced plans start trading its own copper, competing with global commodity traders such as Mercuria Energy Group and Glencore.
The government says this will increase its share of the benefits from the lucrative sector and enhance pricing transparency.
According to Jito Kayumba, President Hakainde Hichilema’s senior economic adviser, Zambia plans to directly buy and sell a portion of the copper produced in the southern African nation, which hosts some of the world’s largest copper deposits.
Kayumba added that the government may opt to receive physical metals instead of royalties from some mines, and that it will hire the necessary expertise to start trading its copper.
His sentiment is backed by the UK Minister for Africa, Vicky Ford, who on Monday, released plans to invest $100 million in the Mimbula copper mine in Zambia.
The investment comes after the Minister spent two days in the country preparing the launch of a new British investment model.
Ford said the initiative was an ideal move for British financing in private sector investments to support Africa.
“We are committed to supporting countries grow their own economies, bolster private sector investment and trade, and deliver the returns that will support wider socio-economic development.”
During her visit, she held meetings with President Hakainde Hichilema after which he hailed the good bilateral relationship between the two countries.
Kayumba said the government could have legislation ready in the next three to six months, and could start with a limited amount of about $100 million.
“We obviously want to do it in a way that’s fair, that’s commercially suitable for the mining companies,” Kayumba said in an interview on Monday at the Investing in African Mining Indaba conference in Cape Town.
“To say that we can come as a commercial player to compete with the other commodity traders, to make financing available for the mines for us to have a fair share of the resource.”
In a statement released by the British High Commission in Zambia, Ford detailed how the investment will create new jobs and increase tax revenues in Zambia.
The Mimbula Copper Project is located in Zambia’s copper belt on the outskirts of Chingola town, 400km northwest of Lusaka.
The deposit is located on a large scale mining licence held by Moxico Resources through its Zambian subsidiary, Mimbula Minerals Ltd.
Moxico holds 85% ownership in the licence holding company, the other 15% is held by Moxico Zambian partners.
The licence was granted in May 2017 with a validity of 25 years.
This key investment comes after the Zambian government signed seven Memorandums of Understandings with the Rwandan government for economic prosperity for the country.