Zambia Investor Briefing: November
OVERVIEW
MINING: President Hakainde Hichilema has announced that British mining giant Anglo American is strongly considering a return to Zambia. China Nonferrous Metal Mining Company has pledged an investment of $1.6 billion into its Luanshya Mining project and other assets on the Copperbelt. Japanese trading house Mitsui & Co is reportedly the highest bidder for a minority stake in First Quantum Minerals’ (FQM) Zambian copper assets. The President’s special assistant for finance and investment has announced that the government’s plans to take larger stakes in some mining projects will not impact existing operations.
ENERGY: The government is considering plans for a $900 million 600MW coal power plant, proposed by Chinese-owned Wonderful Group. The African Development Bank Group’s Board of Directors has approved an $8 million concessional loan to support the construction of a Solar Photovoltaic power plant. Africa GreenCo Group has secured a $55.5 million financing agreement with Stanbic Bank Zambia and Standard Bank of South Africa to support electricity imports and mitigate Zambia's energy challenges.
FDI: Chinese firm Powerful Diligent Veracious (PDV) Metals Limited Steel has commissioned a state-of-the-art manufacturing plant in the Lusaka South Multi Facility Economic Zone. President Hichilema met with a delegation of German industry led by the country’s Minister of Agriculture Cem Oezdemir.
A CLOSER LOOK
Mining Developments
President Hakainde Hichilema has announced that British mining giant Anglo American is strongly considering a return to Zambia, 20 years after the company stopped operating in the country. Writing on Facebook, President Hichilema said he had hosted a delegation from Anglo American at State House, including the company’s CEO Duncan Wanblad. “We are glad to note the renewed interest by Anglo American Corporation to invest in our mining sector after close of 20 years of their exit,” the President wrote. “The 3 million tons annual copper production target we have set for ourselves will require partnerships with reputable mining companies like Anglo American corporation.”
President Hichilema also met with a delegation from China Nonferrous Metal Mining Company (CNMC) led by CEO Wen Gang. CNMC pledged an investment of $1.6 billion into its Luanshya Mining project and other assets on the Copperbelt.
Meanwhile, in welcome news to investors, President Hichilema’s special assistant for finance and investment Jito Kayumba has told Bloombergthat the government’s plans to take larger stakes in some mining projects will not impact existing operations. According to Kayumba, “No entity that currently operates in Zambia today, that currently has a licence, will be subjected to any appropriation from the state”. Instead, the scheme will apply only to permits reserved for the government with the intention on bringing on investment partners. This follows President Hichilema’s reassurance to investors at the inaugural Zambia Mining and Investment Insaka last month that the government will not embark on a controversial reform of the mining sector until it has reached consensus with the country’s mining companies.
This comes as Anthony Mukutuma, country director at First Quantum Minerals (FQM), told The Africa Report, “There is renewed faith by investors in Zambia’s mining sector and the country shall start seeing the results soon… the brownfield developments alone can take output to 1.6 million tonnes in the next four to five years”. Mukutuma also said he was “very optimistic” about FQM’s 2025 outlook in Zambia. Regarding recent energy issues during Zambia’s drought, he pointed to the recent emergence of power traders making energy imports easier, as well as the strong start to the rainy season last month aiding hydropower production.
In other mining news, Japanese trading house Mitsui & Co is reportedly the highest bidder for a minority stake in First Quantum Minerals’ (FQM) Zambian copper assets, which includes Sentinel and Kansanshi mines. It is thought the company is considering a 20% stake for around $2 billion. This follows reports in October that Saudi Arabia’s Manara Minerals was close to finalising a deal with FQM, but it now seems to have been outbid. The company’s CEO Robert Wilt had previously told Reuters, “We are looking at Zambia, we are talking with a company there, with a mine there, so those are pretty advanced stage discussions.”
Energy Projects
The government is considering plans for a $900 million 600MW coal power plant, proposed by Wonderful Group. This would be an alternative energy source to help revive the country’s power supply after the impact of the recent unprecedented drought on Zambia’s hydropower. Gilbert Temba, Chair of Chinese-owned Wonderful Group, and his delegation met with President Hichilema this month to discuss the possible venture.
This follows the announcement in July that a 300MW coal-fired facility would be built in the south of the country. Its construction is being led by Maamba Collieries Ltd, which secured $300 million in financing for the project. Work is expected to be completed by July 2026. These projects align with national goals to diversify the energy mix and lessen reliance on weather-dependent hydropower, and will be a welcome boost to the growth of the country’s energy sector.
In other energy news, The African Development Bank Group’s Board of Directors has approved an $8 million concessional loan to support the construction of a 25MW Solar Photovoltaic power plant in Zambia. The plant development, led by Serengeti Energy Ltd and Western Solar Power Ltd, will serve as a pilot for GreenCo Power Services’ (the operating entity of Africa GreenCo Group) energy aggregator model under the ZESCO open-grid framework.
In other GreenCo news, the group has secured a $55.5 million financing agreement with Stanbic Bank Zambia and Standard Bank of South Africa to support electricity imports and mitigate Zambia's energy challenges. Through its subsidiary, GreenCo Finance Solutions Limited, the company will use the funds to prepay for over 130MW of electricity.
Foreign Direct Investment
Chinese firm Powerful Diligent Veracious (PDV) Metals Limited Steel has commissioned a state-of-the-art manufacturing plant in the Lusaka South Multi Facility Economic Zone. PDV acquired an Investment Licence from the Zambia Development Agency (ZDA) in 2023 and benefitted from both fiscal and non-fiscal incentives facilitated by the Agency. Later in the month the ZDA signed an Investment Promotion and Protection Agreement with China De Jin Xin Limited to construct a $170 million cement plant in Chilanga District – of which $70 million is already invested.
Earlier this month President Hichilema met with a delegation of German industry led by the country’s Minister of Agriculture Cem Oezdemir. The President expressed his eagerness to collaborate with German business in “capital mobilisation, the exploration of critical minerals using advanced technology, and value addition.”
Finally, the Zambia Development Agency (ZDA) participated in the COMESA Business Forum and Exhibition in Bujumbura, Burundi at the end of October. The Agency also participated in the Kenya-Zambia Trade Expo hosted by the Kenya National Chamber of Commerce and Industry (KNCCI) and the Zambia Chamber of Commerce and Industry (ZCCI).
LONG READS
As drought shrivels hydro, this African nation pivots to solar (Yale Environment 360, 21.11.24)
Zambian economy will recover in 2025 as headwinds fade (Fitch Solutions, 21.11.24)
US and Chinese rail projects boost Zambia’s copper industry (The Africa Report, 13.11.24)
The Lobito Corridor: Washington’s answer to Belt and Road in Africa (Geopolitical Monitor, 13.11.24)
Zambia’s $10bn copper revival: A long road to recovery (The Africa Report, 11.11.24)
UPCOMING EVENTS
4-6 December – Africa Investment Forum Market Days Rabat, Morocco
11 December - Strengthening U.S.-Zambia Minerals Cooperation: A Fireside Conversation Online