Mabvuto Chipata,
"With our renewed focus into mining, ZCCM-IH is strategically positioned to be at the helm of the country’s growth of the mining sector, particularly the gold sub-sector."

What is ZCCM-IH’s current portfolio and how do you plan to diversify it?

ZCCM-IH is the successor company to Zambia Consolidated Copper Mines (ZCCM). Our portfolio in mining consists of 13 companies with diversified key commodities such as gold, copper and manganese, among others. We are minority shareholders in all the large mining companies in Zambia, such as in the Kansanshi mine with First Quantum Minerals, and Konkola copper mine, as well as Mopani mines with Glencore. The challenge we are currently addressing is the concentration of our portfolio in one major mineral: copper, which represents 80% of our investments. We are trying to expand further into other metal projects such manganese and gold. Earlier this year we were given a mandate by the Zambian government to spearhead the development of the gold sector. Zambia’s geology is rich in gold deposits widespread across the country, and the North-Western province is yet to be exploited.

Do you see Zambia playing an increasingly important role in the supply of battery metals?

Copper is a cornerstone of the electric vehicles revolution. In addition to copper, we identified manganese that we are exploring and have begun to mine in Central province. The goal is to invest in more value-addition to industrialise the nation. Zambia will play a catalytic role in battery metals in the future and we as ZCCM-IH are spearheading areas that have not developed elsewhere as we invest in exploration.

From Sep 2019 – June 2020, ZCCM-IH reported a 240% increase in profits. How were you able to achieve this during such a challenging year?

Contrary to most parts of the world, production in Zambian mines was not impacted due to the pandemic; in fact it increased. The increase in our profits was driven by the increase in production of some of the copper mines. Other mines did face some negative consequences. The industry was affected indirectly through external delays in the delivery of equipment from abroad, but not due to internal changes. Our mines continue to operate under strict Covid-19 guidelines.

What is your strategic motivation in wanting to increase your stake in the Mopani mine?

Under our new strategic plan goals, we address the minority stake that we have had for years and that we wish to increase over all our assets if the opportunity arises. Many of our partners have not paid dividends for a long time, therefore, by increasing our control we can ensure that we are in control of running the mines more efficiently and cost effectively. In the future, with our new investments, we are taking majority control.

Our strategic motivation is to ensure Zambia benefits from its resources. Zambia should have more significant participation in the exploitation of its resources. We are yet to benefit from the dividends, even when copper prices were at US$9,000 per tonne. The narrative must change to ensure the country guarantees its benefits.

Zambia struggles with over-reliance on copper. How is the economy diversifying?

The Zambian government has been attempting to reduce the country’s reliance on copper and exploit other sectors. I believe the mining industry can play a catalytic role. As we continue to secure and increase returns from the mining industry, these can be reinvested to fund diversification into other sectors such as agriculture or tourism. Copper, and especially gold can offer the necessary financing to move the Zambian economy beyond copper.

Do you have a final message to our international readership?

With a recognition that sustained growth in the face of near constant disruptions, particularly the cyclical nature of the global commodities markets, requires agile reinvention, as ZCCM-IH we have devised initiatives aimed at revenue and portfolio growth in a sustainable manner.

With our renewed focus into mining, ZCCM-IH is strategically positioned to be at the helm of the country’s growth of the mining sector, particularly the gold sub-sector. We have vast investment opportunities available for interested investors who are welcome to partner with us.