‘Momentous’ Day for Zambia as US-Africa Summit Draws to a Close
As the US-Africa Leader’s Summit draws to a close, President Hichilema has praised “a momentous day for the people of Zambia” as the U.S. company KoBold Metals announced a $150 million dollar (K2,654,442,000) investment to explore and develop Zambia’s Mingomba Copper Mine.
This exciting partnership is set to create jobs for Zambian citizens whilst reinvigorating an underutilised national asset. The deal constitutes part of a highly successful trip that included numerous partnerships, public talks, and a meeting with the President of the United States, Joe Biden.
The trip represents an important step in strengthening Zambia’s economic outlook and amplifying its international reputation as promised during the 2021 election campaign. President Hichilema has utilised the newly agreed IMF Extended Credit Facility to drive foreign investment, foster macroeconomic growth, and more than half the rate of inflation since coming to power.
Zambia’s newest investor, KoBold Metals, is seeking to generate a return on their investment by developing the underutilised copper deposit at Lubambe Copper Mine. Under the terms of the agreement, KoBold will pay EMR Capital, the 80% shareholder of the Lubambe Mine, $115 million to develop the existing mine whilst acquiring a majority stake in the Mingomba copper deposit. Backed by Bill Gates’s Breakthrough Energy Ventures, KoBold seek to use artificial intelligence to responsibly mine for the rare earth metals that are central to the construction of electric vehicles and smartphone technology.
Hichilema speaks at the U.S. Africa Business Forum following the announcement of KoBold Metal’s historic investment. Image via Twitter (@usembassyzambia)
Mingomba represents KoBold’s largest investment yet, estimated to contain over 9 million metric tons of copper. However, as yet it has not been determined where the mineral resources end on this site. It is hoped new technology will help answer this question. As global concerns grow over the scarcity of rare earth metals, the firm seeks to use AI to guide where to procure land, what data to collect, and where to drill in order to find the precious commodities hidden further under the earth’s surface.
“Converted to copper contained in electric vehicles, it’s like 100 million electric vehicles [contained within the mine],” according to KoBold’s President, Josh Goldman.
Speaking in Washington on Wednesday, President Hichilema emphasised that to meet the country’s growth ambitions “new ideas, and new technology” must be utilised. President Hichilema has repeatedly stated his ambition to more than triple Zambia’s annual copper production to 3 million metric tons. Utilising AI to get the most out of dormant or under-utilised sites such as this can unlock one of the highest-grade copper resources in the world. Initial discoveries were first made at the two sites in the 1920s but as mapping technology improves, its true potential is increasingly unveiled.
Michael Gonzales, U.S. ambassador to Zambia, told the press that the deal “sends a powerful signal that the U.S. and its allies can and will compete successfully for the minerals and resources that will power the global clean energy transition.”
The deposits are located in the rich Central African Copperbelt, the same area in which the Kansanshi copper mine is located. Earlier in the year, First Quantum Minerals Ltd. approved a $1.25 billion project to extend mining operations at Kansashi. Zambia and the Democratic Republic of the Congo recently signed a Memorandum of Understanding in which the U.S. will support the two countries in further developing an electric vehicle value chain. Such extensions will prove vital in the realisation of the goals set out in the memorandum.
Zambia and the DRC sign an MoU on electric vehicle value chains at this week’s summit. Image via Twitter (@HonKakubo1)
Speaking recently at the 5th Annual Corporates and Diplomats Gala in Lusaka, the U.S. ambassador praised the “excellent strategies and policies” being implemented by the government. “If the government is going to continue implementing these strategies, the country will go far in terms of development.”
The Government of Zambia has made particular efforts to induce foreign direct investment through its recently launched Zambia is Back campaign. The campaign seeks to help companies and financiers work alongside the government and to connect them with local private sector partners to foster growth. Tax concessions have also been introduced for 2023 in the manufacturing, tourism, and green energy sectors with a view to maintaining 4% year-on-year growth and achieving middle-income status by 2030.
Owing to its young, growing populations and the rich deposits of rare earth minerals that are set to prove so vital to the future of electric cars and smartphone technology. In this context, President Biden is courting African leaders for their friendship and support. Sites contained within the Central African Copperbelt have world-leading deposits of cobalt and lithium which are vital in the Sino-American competition to lead innovations in next-generation computing and decarbonisation.
The Biden administration is now openly supporting proposals to include the African Union (AU) in the G20. This is a clear move to recognise the importance of the continent and suit its leaders. Such a move would make the AU the second regional body recognised by the forum for economic cooperation after the European Union. The group already accounts for 85% of global GDP, and 65% of the world’s population. The inclusion of African nations would further bolster the global standing of the group whilst increasing the ability of African nations to determine the global political and economic agenda.
President Hichilema meets Joe Biden, President of the United States of America, and First Lady Jill Biden. Image via Twitter (@HHichilema)
President Biden has also raised the prospect of expanding the UN Security Council to include permanent representation for Africa. The move may be unpopular in some circles as ultimately expansion is dilution within the Council, but Biden is seeking an era of more equitable partnerships between African nations and foreign powers. Just last week, Judd Devermont, senior director for African Affairs at the National Security Council commented that “it’s past time Africa has permanent seats at the table in international organisations and initiatives… we need more African voices in international conversations that concern the global economy, democracy and governance, climate change, health and security.”
In a further deal sealed at the summit, Zambia will be partnering with USAID through the Prosper Africa Initiative to address the global food security crisis. Highlighting the impact of the war in Ukraine in exacerbating global shortages, USAID has pledged to match private sector investment 1:1 to magnify the impact food security initiatives can have on the continent. The partnership between Africa Global Schaffer, Bechtel, and the Export Trading Group will begin in Zambia by building green, Smart Integrated District Aggregation Centers to improve the production and efficiency of maize – a crop that commonly experiences high post-harvest losses. The partners will utilise equipment to protect post-harvest crops whilst the centers will be designed to connect sellers with buyers at key points along vital East African trade routes. One-third of these centers will be run by female smallholder farmers. Eliminating post-harvest maize loss has the potential to provide over 1.5 million Zambians with their necessary daily calorie requirements and improve nutritional outcomes.
Hichilema meets Senator Menendez the chairman of the Senate Foreign Relations Committee. Image via Twitter (@SFRCdems)
President Hichilema has been striving to increase Zambia’s global voice during his visit to Washington. Beyond the US-Africa leaders’ summit, he has attended the Civil Society Forum, and was hosted by the Senate Foreign Relations Committee. The committee, via Twitter noted how they “deeply appreciated the opportunity to speak about our shared commitment to strengthen Zambia’s democratic institutions and to pursue future economic prosperity and broader regional security.”
The summit has been received warmly on both sides of the Atlantic. An impressive $15 billion dollars of two-way trade and investment deals were concluded over the course of the summit. In his closing remarks Biden emphasised he has “known for a long time that Africa’s success and prosperity is essential to ensuring a better future for all of us, not just for Africa.”
