Zambia's mines privatisation drive backfires

| Friday April 20, 2007 00:00

NDOLA: Mining is risky. Judged empirically, working in underground mining operations is more dangerous than hunting man-eating lions in the Chobe or any other national game reserve in the Southern African region.

Far more people - underground miners to be precise - get killed in underground accidents each year in Zambia, as elsewhere in the world, than those who get mauled by ravenous lions.

The history of Zambia's mining industry dates back to 1908 when Kansashi Copper Mine in North Western Province became the first mine to start operating on a commercial scale.  In the ensuing years more copper mines were established - Roan Antelope Mine in 1911, Bwana Mkubwa (Ndola) in 1913, Rhokana in 1922, Nchanga in 1924, Mufulira in 1928, Konkola in 1923, Chibuluma in 1939, and Nampundwe in 1914. Zambia thus started booming as a mining nation, it was in fact the Botswana of that era. Workers from across the globe flocked to the Copperbelt, which was developed by South African mining houses. The copper mining industry has been, and continues to be the mainstay of the country's economy and principal foreign exchange earner.

The mining industry however has inherent operational hazards accounting for a plethora of occupational hazards, fatalities and industrial ailments. For this reason most Zambians loathed to work on the mines, particularly underground. So, to keep mines running, mine authorities relied on migrant labourers from neighbouring countries, particularly Tanzania, Nyasaland (Malawi), Southern Rhodesia (Zimbabwe) and Lesotho. That marked, as it were, the beginning of turning Zambia, particularly the Copperbelt, into one of the most urbanised countries in Africa.

Zambia's mining industry, long before and after independence, was the exclusive domain of two of the world's mining giants - Anglo American Corporation (AAC) and Rhodesian Selection Trust (RST).

But the Zambian government took an earth-shaking move, partially nationalising the two mining groups, by acquiring 51 per cent majority shares in both AAC and RST as a result of the 1968 Mulungushi Economic Reforms. As a consequence, the names of the two companies changed from AAC and RST to Nchanga Consolidated Copper Mines (NCCM) and Roan Consolidated Copper Mines (RCM) respectively. The NCCM group owned Nchanga, Nkana, Konkola, Nampundwe, and Kabwe mine (lead and zinc) while RCM owned Mufulira, Roan Antelope, Chibuluma, Chambeshi, and Kalengwa mines.

In 1980, the government took yet another far-reaching decision by merging the two groups into a single monopoly - the Zambia Consolidated Copper Mines (ZCCM) with Francis Kaunda as its chief executive.

It was no easy, simple neither single-minded decision to have the mining companies nationalised, and have them restructured into a mono-mining group. It took Zambia's first president Kenneth Kaunda (KK) and his cabinet, a whale of a time balancing the national interest against the economic necessity to maintain and sustain the mining industry as a viable proposition. Kaunda's government had critically taken into consideration the country's mono-economy driven by copper mining, the economic main staying power of the nation centred on the copper industry, accounting for an estimated 80 per cent of export earnings in peak production years. Zambia, until now, plays a major role in the global copper market. Nostalgically, Zambia was counted the world's fourth largest producer of finished copper in 1996.

In the booming copper production years catalysed by full-scale industrialisation of copper production processes, when capital-intensive modus operandi was set in motion - an army of educated Zambians joined the mines in professional and technical fields, replacing their expatriate white bosses. Zambia probably had one of the most successful localisation programmes, appropriately called Zambianisation, in Africa.

An English adage says, 'Don't disturb a state of affairs that is fairly satisfactory, lest you make it worse rather than better'.

That came to reality in Zambia in March 2000 when second republican president Frederick Chiluba launched World Bank and International Monetary Fund (IMF) inspired counter-economic reforms, which entailed unfettered privatization.

To most watchers of the Zambian political scene, that move not only sounded the death knell for the economy but also precipitated Chiluba's fall from grace. The former Zambia Congress of Trade Unions (ZCTU) hero, hailed as the biblical David who ousted 'Goliath' from State House during the 1991 multiparty democratic election, has been abandoned by his voters and foreign backers.

Meanwhile, the mining industry is still plagued by problems. Zambia, like most mining countries belonging to CIPEC, has experienced horrific mining fatalities and other occupational afflictions. For some inexplicable reason, the three major disasters recorded in Zambia's mining history, have taken place at Mufulira Mine which, paradoxically, has reputable mining topography, well-deposited copper ore body, and note-worthy mining infrastructure.

The first Mufulira disaster happened in 1940 when 16 miners, were killed in a powerful current of air-blast.

On September 25, 1970, the second disaster occured when miners perished from the inrush of water and slurries.

The following year, 1971, quite a number of people died in Kafironda explosives disaster near Mufulira.

In April this year, a mining-related disaster took place at BGRMME Explosives Company at Chambeshi Mine. Gloomily, 51 employees were killed.

In the same month, six underground miners were killed at Mopani Copper Mine, Mufulira, when a cage went off the running rollers.

The frequent occurrence of mine accidents and fatalities are imputed to, nothing else, but the new companies which in the court of public opinion are 'floundering in the dark with little mining know-how'.

Although the new foreign investors have done remarkably well in reviving the mines, Zambia's experience shows that nationalization, inspired by socialist policies - that seek to put the running of the economy in indigenous hands- can be costly especially if locals do not have the necessary expertise and experience.

The Zambian experience also demonstrates that if the mining sector is to flourish once more, it will need renowned industry captains like the legendary grandmasters Sir Harry Oppenheimer and Sir Ronald L, Prain, whose legacies remain unchallenged.

Are there any lessons for Botswana from the Zambian experience? The answer must be an unqualified 'yes' if the nation is to avoid similar pitfalls that could have far-reaching ramifications. (Sila Press Agency)