British Firms To Invest US$2 BILLION In Zambia’s Energy Sector

ZNBC, Arnold Tutu, January 11, 2023

Seven companies from the United Kingdom are investing TWO Billion dollars in setting up renewable energy projects in Zambia projected to produce two thousand Megawatts of electricity.

British High Commissioner to Zambia NICHOLAS WOOLLEY says the British companies are currently conducting feasibility studies and applying for regulatory approvals before they can kick start their projects.

Mr. WOOLLEY has told ZNBC News in an interview that the companies want to set up solar and wind energy projects in various parts of the country which will produce power to be sold to ZESCO.

The British envoy says the two thousand megawatts will be ready to be added to the national grid in the next two to five years.

And Head of Economic Development and Green Growth at the British High Commission in Zambia SARAH BLOOM says a lot of regulatory reforms are needed in the country’s energy sector for it to attract more investment.

Ms. BLOOM says tariffs need to be attractive and that ZESCO should be in a good financial situation for it to be buying power from independent producers.

And Special Assistant to the President for Finance and Investment JITO KAYUMBA says President HAKAINDE HICHILEMA is committed to reforming the energy sector to make it more attractive to investors.

Mr. KAYUMBA says government is working towards attracting more investments in the sector to achieve energy surplus in the coming five years.

He says the current energy crisis has highlighted the urgent need to increase the amount of energy the country produces to surpass the demand.

The seven British firms which are about to invest in Zambia are Hive Green, Western Power, Buffalo Energy, Africa GreenCo, First Quantum Minerals Solar Energy, Vitalite Solar and SolarAid.

Thinking of investing in Zambia’s future? Sign up for our investor briefing or get in touch at info@zambiaisback.com

Zambia’s Role in the Green Energy Transition

Zambia is well positioned to provide the world with the minerals it needs to transition to renewable energy.

With its significant reserves of copper and cobalt, metals that are fundamental to the transition away from fossil fuel reliance, it has the potential to provide global supply chains with crucial components for years to come.

These minerals are used not only in wind and solar powered technology, but are also fundamental to the production of batteries used in electric vehicle production.

 Transitioning to electric vehicles and increased energy supply via renewable sources is fundamental to the shared global commitment to keep global warming below 1.5 degrees. In the words of the United Nation’s Net Zero Coalition “replacing polluting coal, gas and oil-fired power with energy from renewable sources, such as wind or solar, would dramatically reduce carbon emissions.”

Consequently, according to the International Energy Agency, Copper demand is expected to three times its current level by 2040, while cobalt demand is expected to rise more than twenty times.

Zambia accounts for 6% of the world’s copper reserves. It produces 850,000 tonnes of copper annually, making it the world’s 7th largest producer but with government focus and foreign investment this is expected to rise significantly. 

Canadian firm First Quantum Minerals (FQM) have committed to a $1.25 billion dollar investment into the Kansanshi copper mine as a reflection of their “renewed confidence” in Zambia’s investment climate. The investment is designed to expand the mine and seize the opportunity rising international demand presents.  

President Hichilema is keen to see Zambia meet the global rising demand in order to spur economic growth. A key part of the UPND’s growth strategy, designed to steer the country into a period of middle income prosperity following the instability of the Lungu years, is the commitment to increase copper production more than three times over.  

By 2030, it is hoped Zambia will produce 3 million tonnes of copper a year – that represents an impressive 352% increase in production on a commodity that already accounts for 80% of the country’s export earnings. 

Copper is critical for solar PV, wind, hydro, electric vehicles and national electricity grids, there are few metals more fundamental to a green transition. Zambia is placed in an extraordinary position to spur its own economic take-off and to foster a status as a crucial player in the fight against climate change.

This is why during December’s US Africa leaders’ summit, held in Washington, D.C. leaders from Zambia, the Democratic Republic of Congo, and the US signed a memorandum of understanding to develop an electric vehicles battery chain.

It is also why US-based firm KoBold Metals have announced a $150 million development into the Mingomba copper-cobalt mine in the country. The Bill Gates backed startup aims to use artificial intelligence to create a map of the Earth’s crust, identifying areas with the highest concentration of cobalt and copper deposits in order to locate minerals overlooked by traditional exploration as the earth’s most accessible minerals have increasingly already been mined. The company’s CEO is absolute: he does not see KoBold as a mining operator but a leader in the “electric vehicle revolution.”

Because copper is a highly efficient conductor, it is used in electric cabling and its efficiency reduces wastage. It is also one of few materials that can be used again and again without a loss in performance. Copper plays an important role in making energy production as efficient as possible with minimal impact on the environment.

Traditionally, Zambian government have sought to extract the greatest possible tax value from the mining industry. However, the New Dawn government have reduced the tax payable on new mines in order to encourage further exploration, induce investment, and create the greatest possible economic gain for the entire Zambian economy, not just the government’s coffers.

In this new climate, mining giant Barrick Gold has recently announced record yields from its Lumwana copper mine. Crucially for Zambia’s future, the company’s presence in the country has benefits beyond corporate and treasury income. Barrick Gold employ more than 4,000 people in the country, 99.3% of those are Zambian nations benefitting from the firm’s employment. It has been estimated that when royalties, taxes and local employment are combined, the firm have contributed $8.2 billion to the country’s economy.

In the past, Zambia has not taken full advantage during copper booms. From 2003 to 2006 the price of copper tripled, Zambia’s economic growth rate also grew, but poverty and income inequality remained unaffected.

Without integrating the benefits of foreign investment into the broader economy, Zambia could once again fail to capitalise on the opportunities presented by its extraordinary natural resources. By encouraging foreign firms to employ Zambia workers in the mine, in catering, housing, security, and to executive positions within local structures.

As optimism grows that Zambia can play a leading role in a transformed world, there is hope that President Hichilema can create meaningful change for Zambians.

A Room With a View: Radisson Blu Open Resort on the Zambezi

World-renowned hotel business, Radisson Hotel Group, has brought its brand of luxury tourism to Africa. Their newly announced resort in Zambia will serve as the flagship for the company’s long-term expansion on the continent.

The opening of their first African safari destination marks a key step towards the company’s goal of opening 150 hotels in Africa this decade. They wish to have opened or have under construction at least 150 African hotels by 2025.

Just one mile south of Livingstone, the Radisson Blue Mosi-oa-Tunya is well connected to transport links whilst only being two and a half miles from the glorious sights of Victoria Falls – of the Seven Natural Wonders of the World.

The glorious Victoria Falls is just a few miles away

The beautiful UNESCO World Heritage Site is one of Zambia’s greatest attractions. Remarkably, the falls are the world’s largest sheet of falling water and are almost double the height of the famous Niagara falls and half a kilometre wider. With the resort located on the Zambezi river, tourists can see the awe-inspiring falls and enjoy beautiful vistas whilst being surrounded by unique ecological diversity. 

Tourists can now visit the hotel and its wonderful surroundings with ease. Zambia is a safe, beautiful, and increasingly prosperous destination for foreign tourists. Visitors from the EU, UK, USA, and China no longer have to worry about troublesome visa fees either since President Hichilema’s government removed such barriers to entry in November of last year.

The environment is a fundamental part of Zambia’s beauty, diversity and history. Environmentally conscious travellers can rest assured they are making a responsible choice staying at Radisson’s new resort. The resort has signed the UNESCO Sustainable Tourism Pledge, as part of Radisson’s global “Responsible Business” program and it has earnt EDGE green building certification. The certification reflects an impressive 20% increase in energy efficiency, water reduction and use of sustainable materials when compared to similar local properties.

The incredible views available at Mosi-oa-Tinya

The Mosi-oa-Tinya resort has 200 top-class rooms, suites and villas including some with panoramic views across the Zambezi river. The resort also offers a range of facilities including a gym, a bar, and a swimming pool. If you get hungry they boast six restaurants some inspired by local African cuisine while others set to serve a more European taste. If you’re thirsty there are a number of bars including the Mopani Bar and Lounge. And if you need to catch up on some work Radisson also offers boardrooms and meeting rooms. You can also host an event for up to 250 people in their impressive ballroom. 

There are a number of activities throughout the national park including helicopter rides over the falls, rafting, canoeing and game drives. You may also catch a glimpse of the rare White Rhino or the more common elephants, giraffes, hippos and bird species that surround the hotel.

The Lower Zambezi National Park is a haven of African wildlife that has seen an impressive regeneration in recent decades following crucial reductions in the levels of illegal poaching.

The World Bank recently announced they would be investing $100 million to boost tourism in Zambia. For a country of such natural beauty, it remains an underutilised path to prosperity. Indeed, tourism minister Rodney Sikumba has described himself as “extending an olive branch” to potential investors as he seeks to continue his program of communications and infrastructural improvements in order to create as smooth and relaxing a tourist experience as possible. President Hichilema, too, has called for greater regional integration of east and southern African tourist routes in order to better showcase the beauty and cultural diversity of the region.

The entrance of Radisson Blu to Zambia represents a significant step. With over 75 years of hospitality experience, 1,100 hotels, and billions of dollars of revenue Radisson will bring world-class hospitality to the Zambezi.

Shaun Wheeler, General Manager of Radisson Blu Mosi-oa-Tunya Livingstone Resort, Zambia, expressed his excitement at the company’s expansion in Zambia. “I am thrilled to lead the team as we open this magnificent property which allows us to offer visitors memorable moments and exciting experiences such as discovering one of the Seven Wonders of the world (The Victoria Falls), which is a short distance from the hotel”. 

Having already established a hotel in Zambia, the company are doubling down on their faith in the country’s prospects and attractiveness to foreign tourists. Mr. Wheeler continued “Radisson Blu Mosi-oa-Tunya Livingstone Resort, Zambia represents a unique destination for our guests to discover and explore,” says Tim Cordon, Chief Commercial Officer, Middle East & Africa, Radisson Hotel Group. “The expansion of our presence in Zambia demonstrates our belief in the country’s potential. This hotel is our second property in Zambia, following the opening of Radisson Blu Hotel, Lusaka, with a third hotel, Park Inn by Radisson Lusaka, Longacres, due to open in 2023.” 

With visa fees out the way and world-class providers like Radisson placing their faith in the country, is it time you invested in the future of Zambia?

Thinking of investing in Zambia’s tourism industry? Sign up for our investor briefing or get in touch at info@zambiaisback.com

Thinking of visiting? Why not explore zambiatourism.com for more information.

PE-Backed Firm Helps Zambia Become Africa’s Top Stock Performer

Bloomberg, January 3, 2023

• Copperbelt accounted for majority of the Zambian index’s gains

• Lusaka’s benchmark index has jumped 12% in dollar terms

A rally in Copperbelt Energy Corp. helped Zambia’s benchmark stock index become Africa’s best performer this year. 

The 22-member Lusaka Securities Exchange All Share Index climbed almost 12% in dollar terms in 2022, its second straight year of gains. Copperbelt, which supplies power to mining companies in Africa’s second-biggest copper producer, contributed most to the index’s advance.

Local investors piled into the power supplier’s stock after the government of President Hakainde Hichilema, who was elected in August last year, helped resolve a dispute the company had with the previous administration. The gains in the company’s shares may continue next year, according to Charles Mate, founder of Stockbrokers Zambia Ltd. 

“What we have seen really is a resurgence in terms of investor interest, especially from the domestic market,” Mate said. “This stock still has significant upside.”

Lusaka Securities Exchange performance since January 2020, via https://luse.co.zm/

Copperbelt, which is more than a third owned by private equity firm Affirma Capital Singapore Pte, since 2020 was locked in legal wrangle with the government. The disagreement began dissipating in January.

With a trailing price-to-earnings ratio of about five times, Copperbelt Energy is still undervalued, said Mate, who helped set up the local stock exchange in 1994 and was its first general manager. 

By Matthew Hill

Buya Bamba: Bringing Food Security to Zambia

Zambia has started exporting fresh potatoes and frozen French fries to South Africa and Namibia. 

The export is taking place through Shoprite, one of the continent's largest retail supermarkets.

 Local Shoprite and Hungry Lion outlets in Zambia have concurrently stopped importing potatoes from South Africa because Buya Bamba can meet the quality and demand requirements locally.

Until recently, Zambia would import millions of dollars’ worth of frozen potatoes from foreign markets including South Africa. Domestic production, it is hoped, will reduce the costs for Zambian purchasers whilst also leading to Forex savings for the Zambian economy.

In 2021 the firm completed the construction of a $7 million dollar factory for the production of commercial frozen chips. It is the only one of its kind in Zambia, and it is hoped it can make Zambia a net exporter.

Buya Bamba has been in operation since 1999, initially created by Anthony Barker and Juri van Zyl to connect potato farmers with the restaurants and retail outlets that needed their produce. They’re now a major and essential contributor to Zambian agriculture. Their seeds are chosen with care to ensure sustainability and high yields for the Zambian ecosystem and economy.

As well as the farming of potatoes, Buya Bamba also run an impressive logistics organisation to help get Zambian potatoes into supermarkets across southern Africa.

President Hichilema is keen to support the growth of small-holder farming in Zambia. Indeed, promised in the 2023 budget are 256 additional extension support officers and 69% budgetary increase for the Comprehensive Agricultural Support Plan. The plan now boasts a budget of K9.1 billion. 

Managing Director, Anthony Barker, believes the company’s greatest strength is providing small farmers with access to the market. “We let every single consumer, including takeaways, restaurants, corporate restaurants, supermarkets, and the end-user access potatoes from the small farmers,” he commented.

 Barker told Business Focus that he is optimistic about the Zambian market going forward. “[I] believe that there’s going to be more stability in times to come, and I think the future looks bright for Zambia at this point. We’ve invested in that future as a company,” he said.

“The people in Zambia are amazing,” Barker insists. “They’re really a very hard-working culture, and I’m very proud to work with them. I am Zambian myself and I am very proud to work with the Zambian people. We are providing options for people to buy and sell potatoes, providing for all walks of life. I love Zambia and will continue to invest here- this is my home.”

The company also hold significant amounts of potato seed in cold storage. Potato seedlings are easily perishable so cannot be held in ordinary warehouses or by the typical farmer for extended periods of time. These stores help ensure the year-on-year continuation of production even if the preceding harvest proved unfruitful. However, Barker wants to see cold storage grow in Zambia in order to make the country fully self-sufficient and a net exporter.

Food security is a key priority for both the Zambian government and international agencies. In an agreement signed at the US-Africa Leaders Summit earlier this month, USAID and the Zambian government agreed to cooperate through the Prosper Africa initiative to increase regional food security. While the initiative will focus specifically on reducing post-harvest losses on Maize, the improvements in research and equipment are designed to improve the efficiency and security of food production across the board.

Zambia Investor Briefing December 2022

 ZAMBIA INVESTOR BRIEFING

December 2022

OVERVIEW

• President Hakainde Hichilema travelled to the US to take part in the US-Africa Leaders Summit, hosted by US President Joe Biden in Washington, D.C. The summit was attended by almost all African heads of state, in addition to business leaders and investors from the continent. While there, President Hichilema participated in the inaugural US-Africa Business Forum, co-hosted by the US Department of Commerce, the US Chamber of Commerce and the Corporate Council on Africa, in partnership with the US government’s Prosper Africa initiative.

• A US-based company, KoBold Metals, will invest USD 150 million in Zambia’s Mingomba mine project. The deal was announced by President Hichilema at the recent US-Africa Leaders Summit. The California company, which is backed by tech tycoon Bill Gates, said the Mingomba project’s potential to become “one of the world’s top-tier mines”, was why they were so attracted to the deal. KoBold Metals are buying into the joint venture with Australian firm EMR Capital and ZCCM-IH.

• The DR Congo and Zambia have signed a Memorandum of Understanding (MoU) with the US. The agreement promises US support to both the DR Congo and Zambia in developing an electric vehicle value chain. Present at the signing, which took place on the first day of the US-Africa Leaders Summit, were US Secretary of State Anthony Blinken, DR Congo Vice Prime Minister and Foreign Minister Christophe Lutundula and Zambian Foreign Minister Stanley Kakubo.

• Canadian mining company First Quantum Minerals (FQM) are to pay the state-backed ZCCM-IH in revenue royalties, rather than dividends, following negotiations between parties. 

• President Hichilema opened a new one-stop-border-post at Mchinji-Mwami with his Malawian counterpart Lazarus Chakwera. The border post is of “vital importance to the economies of Zambia and Malawi”, the president said.

• Radisson Hotel Group has opened its first Zambian resort. Found on the banks of the Zambezi River and just 4km from Victoria Falls, Radisson Blu Mosi-oa-Tunya Livingstone Resort is the Group’s first safari resort in Africa.

Mining Developments

President Hichilema travelled to Washington, D.C., to attend the US-Africa Leaders Summit, which took place over 3 days between 13-15 December. The summit aimed to strengthen ties between the world’s largest economy and its African partners. 

While there, the president announced a USD 150 million investment in the Mingomba mine, thought to be the world’s highest-grade undeveloped large copper deposit. The pledge came from KoBold Metals, a California-based artificial intelligence firm backed by Bill Gates and EMR Capital. 

EMR Capital executive chairman Owen Hegarty told reporters that KoBold Metal will take a 52% stake in the Mingomba project, while the other joint venture partners, EMR Capital and Zambia's state-backed ZCCM-IH, will own 28% and 20% respectively.  

Elsewhere, Canadian mining company FQM has agreed to convert dividends from its copper mine at Kansanshi to a revenue royalty. According to the agreement, ZCCM-IH will receive 3.1% in a revenue royalty from the mine, which is forecast to produce between 140,000 and 150,000 tons for the financial year ending December 31.

According to economist Oliver Saasa, the deal will allow ZCCM-IH to extract more value from the Kansanshi mine than would have previously been the case with the divided model. “The overall average revenue from the royalty model that ZCCM-IH has opted for is expected not only to be higher, but also more predictable and consistent”, he told Mining for Zambia. “If you ask me, this could be a model for all mining business[es] in Zambia to consider”.

Debt Management

US Treasury Secretary Janet Yellen held a closed-door meeting with President Hichilema during his recent trip to the US. The pair discussed “the need to address debt sustainability and the imperative to conclude a debt treatment for Zambia”, according to Yellen. She added that it was important for Zambia’s creditors to conclude an equitable debt restructuring deal as quickly as possible to lend credibility to the G20 Common Framework for poor country debt relief. 

Yellen also announced plans to visit the continent from 17-28 January, taking in Zambia, South Africa and Senegal. US President Joe Biden too said he hoped to visit next year, which would be the first visit to sub-Saharan Africa by a sitting US president since Barak Obama’s in 2015.

President Hichilema held further meetings with World Bank officials in Washington, D.C., accompanied by Minister of Foreign Affairs Stanley Kakubo, Commerce Minister Chipoka Mulenga and Mines Minister Paul Kabuswe. 

Other sideline discussions at the summit yielded a promise from the Millennium Challenge Corporation, an independent US government foreign aid agency, that a second so-called compact aid package would be signed with Zambia in 2023, targeted largely at the agriculture sector. The first of such packages was secured in 2018, with USD 355 million aimed at boosting the country’s supply of drinking water. 

Regional Partners

The New Dawn government has agreed to further help the US secure batteries for electric vehicles. An MoU was signed between the US, Zambia and the DR Congo, aiming to develop an industry to process strategic raw materials like cobalt, lithium, nickel and manganese in the Copper Belt. 

Closer to home, President Hichilema launched the Mchinji-Mwami one-stop border post with his Malawian counterpart, Lazarus Chakwera. “We are one people and we need to invest jointly to grow the economies of our two countries”, he remarked at the ceremony.

LATEST TRENDS 

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OTHER NEWS

IMF to assess Zambia in spring, urges debt deal with creditors, 09.12.22, Reuters

Government calls on proper management of mineral resources in Mkushi, 12.12.22, Lusaka Times

ZDA calls for increased trade and investment between Zambia and USA, 12.12.22, ZDA

Beeline Telecom to launch operations in January 2023, 13.12.22, Lusaka Times

Debt defaulter Zambia seeks to offload costly presidential Gulfstream jet, 15.12.22, Bloomberg

Government launches interim guidelines on carbon market and trading, 19.12.22, Lusaka Times

Government implores stakeholders to invest in electricity generation, 19.12.22, Lusaka Times

HH to hold end of year press conference, 20.12.22, Diggers

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PHYLA Earth: Regenerative Agriculture for Zambia’s Future

PHYLA Earth is a remarkable organisation focusing on investment in “nature’s capital”. By engaging communities and corporations, weaving novel technologies together to find remarkable solutions, and connecting partners to new markets, they seek to boost the triple bottom line: bringing economic, social, and environmental benefits to Zambia.

PHYLA use advanced agronomic technologies to help farmers improve their soil management and encourage “regeneration agriculture” across Africa’s Great Green Wall. The Great Green Wall is a remarkable initiative to build an unbroken line of trees stretching 8,000km across the middle of the African continent to help fight the effects of climate change. 

In Senegal, The Great Green Wall is using Acacia trees to help fight desertification. At its worst, this phenomenon can force families from their homes as the land becomes arid and leaves people’s home communities unliveable. In Zambia, PHYLA are hoping to use regenerative agriculture to engineer a new wealth creation dynamic; restoring arable land through resistant ecology in order to improve the land, create jobs, bolster communities, sequester carbon and produce food.

At COP27 PHYLA Earth’s CEO Rabih El Fadel and co-founder Harry Verns showcased their flagship project: the Pongamia regenerative agroforestry project at Konkola Copper Mines.

Konkola Copper Mines (KCM) is one of Africa’s largest integrated copper producers. The Zambian mine produces millions of tons of copper per year, which is fundamental to the electric battery value chain and so the future of sustainable transport. The metal is also central to the present and future prosperity of Zambia.

However, mining often comes at an environmental cost. In this case, mining increases the salinity and sodicity of the surrounding soil  and limits natural plant growth – an issue for 833 million hectares of soil worldwide.

PHYLA Earth are developing a remarkable orchard in Chingola, Zambia, in order to combat this problem. Their work facilitates the prospect of continued extraction of minerals needed for the transition to clean energy, whilst supporting local farming and increasing ecological resilience.

 The 4,000 elite Pongamia seedlings planted on untreated land next to the mines have experienced a mortality of less than 1%. The trees have instead grown, flowered, and produced pods in quantities expected from much more fertile soil. From an ecological perspective, the main benefits of Pongamia tree-based agroforestry is the potential to restore biodiversity, binding the soil with its roots and providing life giving nectar for vital pollinators.

 But the benefits go even further. Pongamia have significant climate resistant properties, weathering drought, salinity changes and high levels of metals in the soils better than other plants. Seedlings, meanwhile, can be used as biopesticides, insect repellents, and as a source of food-grade vegetable oil.

 According to the United Nations, investments in nature-based solutions to climate change must treble by 2030 if the world is to tackle the triple threat of climate, biodiversity and land degradation. PHYLA seek to foster a circular bioeconomy to meet this challenge. ]

 The development of Pongamia orchards provide jobs and income. This income is in turn expected to facilitate further Pongamia plantations - again increasing biodiversity and providing more seedlings for useful by-products. The conceptual circularity of this cycle allows PHYLA to believe such investments can create what they refer to as “perennial dividends” on the initial investment.

 The project is being extended to target 1.5 million saplings next year in India and Southern Africa.

 At COP27 PHYLA showcased the Chingola project and made the case for why they believe “agro forestry is the perfect tool to remediate degraded land and rural markets” and to explain how “our trees provide farmers with highly productive, carbon removing perennial, drought tolerant option to increase farm revenue and power local economies.”

 The company’s approach recognises that nature provides infinite value to the economy but requires unprecedented investment to secure future returns. PHYLA wishes to see the reconstruction of economic models to include nature as the planet’s most precious asset.

 Tackling deforestation is a priority of the Zambian government. Environmental sustainability is one of the four pillars supporting the UPND’s economic transformation plan outlined in the Medium-Term Budget Plan. To this end, the New Dawn government are setting up timber exchanges around the country in order to increase transparency and reduce illicit and damaging deforestation practices.

 Further, if you wish to invest in PHYLA Earth, it is worth knowing that green bonds (with a maturity of at least three years) have been granted tax exemptions aimed at encouraging investments in projects with environmental benefits.

 PHYLA’s remarkable work would not be possible without the cooperative research of the University of Zambia, the University of Reading (UK) and the University of Bradford (UK). Such international intellectual exchanges and research are vital to driving the world’s economy towards a cleaner future. PHYLA’s researchers include specialists with 50 years of dedicated practice.

 Thinking of investing in Zambia’s agriculture industry? Sign up for our investor briefing or get in touch at info@zambiaisback.com

KoBold Metals: The Mining Exploration Firm Using AI To Lead The Electrical Revolution

Last week it was announced that US-based mining exploration firm KoBold Metals would be investing $150 million to develop the Mingomba copper-cobalt mine in Zambia.

The new deal is a joint venture between private equity firm EMR Capital and Zambia’s state-backed ZCCM Investment Holdings (ZCCM-IH) and is set to close within the first quarter of 2023.

KoBold Metals is a start-up firm which uses artificial intelligence (AI) and machine learning to coordinate mining for metal deposits used in making electric car batteries. The company, which began its mining operations in Canada two years ago, aims to create a “Google Map”  equivalent of the Earth’s crust, highlighting areas which have high levels of cobalt and copper deposits. 

This ‘mapping’ is done by collecting and analysing streams of data of both new and old deposits. The company then uses algorithms to determine where new deposits may be found. As a result, KoBold is better equipped to locate minerals that may have been overlooked by more traditional methods of exploration.

Despite being such a young company, Kobold already has an impressive portfolio, having acquired multiple exploration sites in Quebec, Saskatchewan, Ontario, and Western Australia.

The start-up also has an impressive lineup of stakeholders and investors. These include Australian multinational mining company BHP and support from climate and technology innovators Breakthrough Energy Ventures. 

Founded by Bill Gates in 2015, Breakthrough is an umbrella company for a range of organisations that aim to accelerate the innovation of sustainable energy sources to mitigate the effects of climate change. The company is also backed by Amazon’s Jeff Bezos and Virgin’s Richard Branson. 

Kobold’s chief executive officer, Kurt House, who has been working with the company for over five years, has previously stated that he does not want to be considered a mining operator “ever,” and that the company root itself in leading the way for the “electric vehicle revolution.”

The new Zambia-based project is a major step forward for both the company and the country. Firstly, it will place President Hakainde Hichilema on good footing to achieve his ambitious copper production target of 3 million tonnes a year by 2032. 

Secondly, the Mingomba mine presents a major opportunity to KoBold. The company previously said that the mine is set to be "one of the world's top-tier mines.” They also found that it contains an estimated 247 million tonnes of ore with an average grade of 3.64% copper. That is six times purer than similar deposits found in Chile.

This high quality mine will not only generate more tax revenue for the government but also provide jobs for many Zambians. It will also support Zambian-run businesses within the mine’s value chain in everything from machinery to transportation. 

Furthermore, as global consumers make changes towards more climate-friendly options demand for electric vehicles will continue to grow. It is estimated that the global copper industry will need upwards of $100 billion to meet the infrastructure requirements to meet with this demand. With Zambia being the second largest copper producer in Africa, this deal solidifies the key role that the country will play in the green economy going forward. 

Photo: Khusen Rustamov from Pixabay.

‘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.”

What to expect as US-Africa summit kicks off in Washington

Al Jazeera, December 13, 2022

US President Joe Biden seeks to boost trade opportunities and build trust with African leaders during three days of talks.

The United States aims to boost cooperation with African nations as President Joe Biden hosts dozens of regional leaders at the second US-Africa Leaders Summit this week in Washington, DC.

Beginning on Tuesday, the three-day summit will focus on key challenges, including the climate crisis, good governance, food security and global health, as well as bolstering US-Africa trade and investment opportunities.

“The summit … is rooted in the recognition that Africa is a key geopolitical player. The continent will shape the future not just of the African people, but also the world,” US National Security Adviser Jake Sullivan told reporters on Monday afternoon.

Forty-nine African heads of state and leaders, as well as the African Union, were invited to the summit, Sullivan said during a news conference.

The talks – a follow-up to the first such gathering hosted by former US President Barack Obama eight years ago – mark the biggest international gathering in Washington, DC, since before the start of the COVID-19 pandemic.

Biden has sought to rebuild Washington’s relationship with other countries, as well as to re-engage with global organisations like the United Nations, after four years of his predecessor Donald Trump’s “America First” approach to foreign policy.

The US role in Africa receded during that time, and Biden administration officials have stressed the need to strengthen ties with like-minded countries in the region.

“Working closely with Congress, the US will commit $55bn to Africa over the course of the next three years,” Sullivan said on Monday.

China, Russia competition

The summit comes as China, which the US views as its main global competitor, has consistently outpaced Washington in its investments in Africa. Russia is also trying to rally support on the continent in response to pressure from the US and its allies over the war in Ukraine.

However, in the lead-up to this week’s meetings, top Biden administration officials played down their growing concerns about China and Russia. Instead, they have stressed the importance of including African nations in global discussions.

“We need more African voices in international conversations that concern the global economy, democracy and governance, climate change, health, and security,” White House Adviser Judd Devermont said on December 9.

In August, the Biden administration released a new strategy document for sub-Saharan Africa, stressing the region’s importance and promising to extend defence cooperation with like-minded nations.

In November, US Secretary of State Antony Blinken also said Washington would have to do things differently to help Africa with its infrastructure needs. It was time to stop treating the continent as a subject of geopolitics, but rather as a major player on its own, Blinken remarked.

The region needs billions of dollars a year for roads, railways, dams and power, and in the last decade, it has received huge sums from China, which generally does not tie money to political or rights-related conditions.

Washington has characterised Chinese lending as predatory and leading to potential debt traps. It has instead focused on facilitating private investment, but officials acknowledge that the US needs to do more to speed up assistance.

As part of this week’s summit, Biden will deliver a keynote address to the US-Africa Business Forum on Wednesday, before hosting a dinner for the world leaders assembled in the United States capital.

The US president is expected to back a permanent spot for the African Union in the Group of 20, a forum for major economies, during the summit. Sullivan said Biden also would express a commitment to UN Security Council reform, “including support for a permanent member” from Africa.

“It’s past time for Africa to have permanent seats at the table in international organisations and initiatives,” Sullivan told reporters.

On Thursday, Biden and the other heads of state and leaders will hold talks on promoting food security, after months of supply concerns and disruptions linked to the war in Ukraine. He will also discuss the 2023 elections in Africa and democracy with a small group of leaders, Sullivan said.

“One of the unique aspects of this summit is the collateral damage that the Russian war has inflicted on Africa in terms of food supply and the diversion of development assistance to Ukraine,” John Stremlau, a visiting professor of international relations at the University of the Witwatersrand in Johannesburg, told The Associated Press news agency.

“The opportunity costs of the invasion have been very high in Africa,” Stremlau said.

‘Great opportunities, some risks’

Meanwhile, local officials in Washington, DC, are warning residents to brace for roadblocks and intensified security as the dozens of invited leaders move around the city for the talks.

The US has invited all African Union members in good standing, meaning Burkina Faso, Guinea, Mali and Sudan will not be represented. Attendees must also have full relations with Washington, which excludes Eritrea.

One of the most closely watched leaders expected in Washington will be Ethiopian Prime Minister Abiy Ahmed, a one-time US ally whom the Biden administration has accused of backing widespread abuses in the Tigray conflict. A breakthrough deal last month led to a cessation of hostilities.

The presidents of Rwanda and the Democratic Republic of the Congo (DRC) will also be in attendance, as Blinken exerts international pressure on Rwanda over its alleged support for rebels seizing control of territory in the neighbouring DRC.

Other presidents due at the summit include Egypt’s Abdel Fattah el-Sisi and Tunisia’s Kais Saied, who have both faced criticism for a lack of democratic rights in their countries, as well as Equatorial Guinea’s Teodoro Obiang Nguema Mbasogo, who arrives days after the US called his latest election a sham.

The foreign minister of Zimbabwe, under US sanctions, is also expected to attend.

Analysts say that African leaders will be looking for Biden to make some major commitments during the talks, including announcing his first presidential visit to sub-Saharan Africa, as well as efforts to bolster the continent’s economy through private sector investment and trade.

Mvemba Phezo Dizolele, director of the Africa programme at the Center for Strategic and International Studies, said the US was entering the summit with a “trust deficit” due to the long wait since the last edition in 2014.

“The summit presents great opportunities, but it also poses some risks,” he said.

“This is an opportunity to show Africa that the US really wants to listen to them,” he added. “But now that we have high expectations, the question will be: What will be different now?”

Hichilema Flies to Washington to Attend US-Africa Leader’s Summit

President Hichilema has flown to Washington D.C., in order to attend the US-Africa Leader’s Summit set to begin tomorrow. The three-day event will see leaders across the continent meet with President Biden and his advisors in order to discuss bilateral relations.

On his departure yesterday the President tweeted his excitement to be participating in the summit.  

A statement from the Ministry of Foreign Affairs and International Cooperation explained that “President Hichilema and other Heads of State and Government are expected to deliberate on opportunities for public-private partnerships; bolstering the US-Africa economic relationship; access to capital; food insecurity, and promoting sustainable economic growth and development.” 

Zambia already has a strong relationship with the United States. The U.S. Ambassador to Zambia recently praised the “excellent strategies and policies” being implemented by President Hichilema. Further, the U.S. Government run development agency, USAID, recently launched two business and trade development projects, with a combined budget of $54 million USD in order to further improve the business environment and promote opportunities for women and youth.

The Hichilema administration, however, still wishes to use the summit as an opportunity to further develop US-Zambia relations. To that end the president will be appearing at the US-Africa Business Forum, the Civil Society Forum, the Conservation, Climate Adaptation and Just Energy Transition Forum, and the Council on Foreign Relations.

The president has repeatedly emphasised that the first year of his administration was for stabilising the economic chaos left behind by former President Lungu, and that the second year of his administration is set on unlocking the potential of the Zambian economy.

There is much anticipation surrounding the meeting, with commentators speculating that this year’s summit may redefine the USA’s relationship with the African continent. Over 50 heads of state are expected to be present at the summit and it is hoped relations will improve after former president Trump spurned African leaders by failing to host a second summit following Obama’s 2014 effort.

Since June 2019, the US government has helped close more than 800 two-way trade and investment deals across 45 African countries, worth an estimated $50 billion in exports and investments. With many African nations seeking investment as a result of post-pandemic global economic stagnation, and the Biden administration’s increasing use of the language of “collaboration” above the historic power imbalances that have defined rhetoric and reality, there is hope the U.S. will start seeing Africa as an ally and partner.

 In July, President Biden said the agenda of this year’s summit will be to “build on our shared values to better foster new economic engagement; reinforce the US-Africa commitment to democracy and human rights; mitigate the impact of covid-19 and of future pandemics; work collaboratively to strengthen regional and global health; promote food security; advance peace and security; respond to the climate crisis; and amplify diaspora ties.” This is a long list but officials are optimistic this year’s summit could bring positive change. 

AfriLabs: The Annual Gathering Bringing Innovation to Zambia

As the Government of Zambia strives to transform Zambia’s digital and technological space, AfriLabs seeks to connect remarkable businesses in Zambia to an extraordinary network of supportive innovators across the continent.

AfriLabs is a networking organisation that have been supporting innovation on the continent since 2011. AfriLabs’ 2022 Annual Gathering was held this year in Zambia’s capital, Lusaka from in October. This year they celebrated “Intra-African Connectivity, Collaboration and Innovation” during an event billed as the largest convention of African innovation leaders on the continent.

400 visitors from 52 foreign nations, in addition to 3000 virtual participants, came together to celebrate technological innovation in Zambia and Africa.

One AfriLabs member in particular is targeting digital transformation in Zambia. Ehub Zambia act as a technological centre who aim to improve digital competence for people from marginalised communities. Specifically, they aim to teach coding for those in peri-urban and rural communities up to a job entry level ability.

Ehub Zambia believe this technology competence is important not just for the youth’s future, but for the country as a whole. Improving digital skills facilitates the increased integration of Zambia into global financial markets, while increased access to the internet allows SMEs to operate take advantage of international export opportunities. By upskilling these peri-urban and rural communities Ehub Zambia hope to diversify the job opportunities available to those in often marginalised communities.

The new Ministry of Technology and Science is dedicated to transforming the digital economy. They work closely with private sector partners to improve access to and utilisation of digital technologies.

For example, at the end of November the ministry celebrated the establishment of the first 5G network in the country. Felix Mutati, the minister for technology and science, emphasised this as a crucial step in the country’s digital transformation agenda.  

Speaking at the network’s launch, the Minister also told the press that the Hichilema administration is also working on a new start-up bill to improve access to funding for new enterprises. This will be welcome news for Madica – another impressive attendee of this year’s Lusaka AfriLabs gathering.

Madica, short for “Made in Africa”, is a young pre-seed investment programme aiming to support under-funded African entrepreneurs through both direct financial investment and, in partnership with companies such as Ehub Zambia and the government of Zambia, is hoping to upskill and increase the network of poorly connected African entrepreneurs  

Over the next three years Madica seek to support 25 to 30 African entrepreneurs with up to $200,000 in funding and significant programmatic support. They aim to support bright ideas with little infrastructural support. This is why $6 million dollars of their funding is being held back for programmatic support. Through hands-on support from their team of mentors, plus connections to continent-wide networks through AfriLabs, their goal is to see African start-ups flourish. 

Emmanuel Adeboye, head of Madica, explains that although he believes “Africans have an unmatched entrepreneurial spirit”, they’re disadvantaged in the start-up space. African CEOs raise on average 28% less funding than their foreign educated counterparts, whilst funding in Africa is disproportionately swayed towards male CEOs. 

“We hope that Madica can help change the narrative around African start-ups – lower the perception of risk, attract more capital, inspire more founders, and garner more media attention”, commented one Madica executive.

Since 2021, Zambia has received an extraordinary amount of investment in order to stimulate its economy. For example, in Q3 of this year, Zambia received $1.1 billion in future investment pledges expected to create over 8,000 jobs. However, much of this funding has come from abroad.  

Madica wish to foster the “innate ability of Africa to build Africa” through supportive pan-African networks and investment programmes. Speaking ahead of the conference, Mutatu expressed his excitement at the opportunity “for Zambia to show more of its potential as a leader in entrepreneurship and innovation in the Southern African region.” He spoke in agreement with the directors of AfriLabs and Madica in saying that “if we are to make progress as an African continent, the doors must be open to each other.”

With the government of Zambia seeking to foster partnerships with the private sector in order to accelerate the nation’s digital transformation, and organisations such as AfriLabs actively enhancing connectivity and engendering rapid sector growth, now is a decisive and opportune time to invest in the nation’s potential.

First Quantum to pay ZCCM-IH in revenue royalty following Zambia tax change

FIRST Quantum Minerals has agreed to convert dividends from its Zambian copper mine Kansanshi to a revenue royalty, the Canadian firm said today.

The agreement follows fiscal changes implemented by Zambian president Hakainde Hichilema shortly after his election in 2021 in which royalties were made tax deductible.

In terms of the agreement, Zambia’s government-controlled ZCCM-IH will receive 3.1% in a revenue royalty from the mine which is forecast to produce between 140,000 and 150,000 tons for the financial year ended December 31.

First Quantum said ZCCM-IH would continue to be represented on the Kansanshi Mining board to “ensure full visibility and transparency in respect to KMP’s future operations”.

“We are pleased to enter into this new arrangement for the benefits flowing from the Kansanshi mine,” said Tristan Pascall, CEO of First Quantum in a statement today.

The royalty-for-dividends agreement comes ahead of the proposed $1.25bn expansion of Solwezi section, known as the S3 project, at Kansanshi. This was announced in May when a total of $1.35bn in projects for Zambia were unveiled including the final $100m installment on its $250m Enterprise nickel project in Kalumbila.

“We look forward to continuing the collaborative relationship with ZCCM-IH as we advance KMP,” said Pascall.

The agreement with the ZCCM-IH is further evidence of a thawing of relations between First Quantum and the Zambian government following Hichilema’s election. Two months after his election he reformed the country’s tax regulations in its national budget.

The S3 project will extend the life of Kansanshi until the 2040s, and increase copper and gold production by around 25%. The project will also add approximately 800 permanent jobs, and a further 1,800 during the construction phase.

“Crucially, it also safeguards the futures of the 8,500 people already employed at Kansanshi,” First Quantum said earlier this year.

The Enterprise mine will produce some 10,000 tons of nickel concentrate a year. According to First Quantum it will make Zambia a “pre-eminent nickel producer” supplying manufacturers of batteries for electric vehicles. The mine is expected to be operational within 12 months’ time and employ about 700 full time staff.

This article originally appeared in Miningmx

Zambia Investor Briefing - November 2022

 ZAMBIA INVESTOR BRIEFING

November 2022

OVERVIEW

• According to the Zambia Development Agency (ZDA) Zambia recorded USD 1.1 billion worth of investment pledges in Q3 2022, comparing favourably to USD 631 million in Q3 2021. ZDA projects that the 95 investment ventures will create more than 8,000 new jobs. Manufacturing attracted the most investment (USD 396 million), with energy, mining construction, transport, services, tourism, real estate, health and agriculture also featuring. 

• The Bank of Zambia has maintained the monetary policy rate unchanged at 9%, forecasting growth at 3% for 2022, 4% in 2023 and 4.1% in 2024. Governor Denny Kalyalya indicated that he expected inflation to continue its recent downward trend and return to the target range of 6-8% in Q1 2024, with an average of 8.5% expected in 2023. The next Monetary Policy Committee meeting is schedule for February 13 and 14, 2023.

• President Hakainde Hichilema travelled to COP27 in Egypt where he met with creditors to press for the finalisations on a memorandum of understanding (MoU) on debt reduction. During the conference he also signed an MoU with the European Union on Forest Partnership as part of the EU Green Deal.

• MTN Zambia launched its 5G service on November 24. The service covers approximately 65% of the population in Lusaka, Kitwe and Ndola, in addition to parts of Chingola, Solwezi and Kalumbila. MTN aims to reach 100% 5G coverage for Lusaka, Kite and Ndola by mid 2023, as well as continuing its rural connectivity programme. Meanwhile, Minister of Technology and Science Felix Mutati said government wants to achieve 100% internet connectivity by 2024.

• The US launched two new projects in the country. USAID TradeBoost is a USD 30 million investment project to increase trade and investment nationally, regionally and internationally, while the USAID Business Enabling Project is a USD 14 million initiative to bring inclusive private sector investment and trade to Zambia that includes a strong focus on increased opportunities for women. 

• Government launched a fund in partnership with Huawei - the Hakainde Hichilema Innovation Fund. Under the initiative 50 young Zambians will receive scholarships in the ICT sector.

Mining Developments

As of November 21 Zambia’s mining cadastre office is accepting new license applications, having reopened on October 19 following its closure in February as part of efforts to clean up the licensing process.

The 10th Zambia International Mining, Energy Conference and Exhibition (ZIMEC) attracted over 300 delegates in Kitwe. During the President’s address he reiterated the government’s “steadfast commitment to meeting the ambitious yet achievable goal of raising annual copper production levels from the current 830 metric tons to 3 million metric tons.” 

This month President Hichilema opened a new manganese mine in Luapula province. The 40 million tonnes deposit will be mined over a 20 year period. The mine is Zambian owned by Musamu Resources. The mine currently employs 250 people, which is expected to increase to 1,000 in five years time.

Debt Management

The Export-Import Bank of China (EximBank) is expected to lead Beijing’s team to renegotiate loans owed by Zambia to Chinese state-owned creditors worth almost USD 6 billion. The World Bank and IMF officials continue to press creditors to accelerate negotiations and US Ambassador to Zambia Michael Gonzales called on creditors to reduce the capital that is owed. Bank of Zambia Governor Kalyalya has indicated that he expects debt restructuring to conclude over the first half of 2023 with a significant positive impact on the budget. Meanwhile, the government has hired a private firm to audit domestic debt.

Events

The International Growth Centre (IGC) hosted the inaugural Zambia Economic Growth Forum 2022 (EGF) in partnership with the Government of Zambia. President Hichilema delivered the keynote during which he reiterated the importance of prioritising economic growth.

Speaking at the 2022 Zambian Association of Manufacturers - Proudly Zambian Expo President Hichilema directed the Ministry of Commerce, Trade and Industry to deliver reductions to business licensing costs.

Zambia hosted the 2022 Innovation Africa Ministerial Summit under the theme “digital transformation in education and skills development for Africa.” The event was officially opened by President Hichilema who called for joint efforts towards advancing innovation, transformative education and skills development on the continent, through impactful partnerships between government and industry.

Accountability and Transparency

Government launched the Risk Management Guidelines for the management of resources in the public sector. Commenting on their launch Minister of Finance Situmbeko Musokotwane said they were aimed at improving transparency, accountability and good governance.

LATEST TRENDS 

GDP

Inflation  

Currency

1 USD = 17.09 ZMW 30 day average = 16.519 Volatility (last 30 days) = 0.39%

OTHER NEWS

Zambia central bank launches "go cashless" campaign, 03.11.22, CGTN 

Zambia gets a new lease of life, 04.11.22, fDi Intelligence

EXCLUSIVE Zambia says EximBank to represent Chinese lenders in debt talks, 08.11.22, Reuters

US Envoy Says Zambia Debt Restructure Must Inolve Haircuts, 13.11.22, Bloomberg

Jubilee Metals produces first export quality cobalt in Zambia, 22.11.22, Proactive Investors

Entain makes first play in Africa launching bwin Zambia, 17.11.22, SBC News 

Fintech Unicorn Chipper Cash set to buy  Zambia fintech pioneer Zoona, 18.11.22, TechCabal

Why Now Is the Right Time to Invest in Zambia, 24.11.22, Lusaka Times 

UPCOMING EVENTS

13.12.22 - 15.12.22

U.S. Africa Leaders Summit

Washington, DC

15.12.22 - 16.12.22

International Conference in Information and Communication Technologies

Lusaka

CONTACT US

If you would like to find out more or receive tailored briefings on specific sectors then get in touch via info@zambiaisback.com. To stay up to date follow us on social media: 

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Celebrating 25 Years of Chinese Banking in Zambia

Last Friday (November 25), the Bank of China celebrated 25 years of banking in Zambia. At a special event held in the country’s capital, Lusaka, the bank’s Managing Director, Wang Qi, the Chinese Ambassador to Zambia, Du Xiaohui, the Bank of Zambia’s Deputy Governor, Francis Chipomo, and the Minister of Finance and National Planning, Situmbeko Musokotwane came together to celebrate the continuing partnership between the two countries.

Mr Qi expressed his pride at the Bank’s long service to the people of Zambia and went on to pledge the Bank’s ardent support to the country’s economic development.

“The fact that a Chinese financial institution has taken root, grown and thrived in Zambia shows that the Chinese government and Chinese financial institutions have been bullish on Zambia’s good business environment and broad development opportunities,” commented the Chinese Ambassador, Du Xiaohui.

The Bank of China estimate they have provided $3 billion in economic development stimulus and contributed $44 million in tax revenue to Zambia.

Partnerships between the two countries continue to grow. More than 60 Zambian companies have established connections with Chinese partners since the arrival of the Bank of Zambia. To foster these ties, more than 40 Zambian companies participated in this year’s China International Import Exposition.

 The exposition, which is held yearly in Shanghai, is estimated 150,000 domestic and foreign professional purchasers attend the event. As of 2018, bilateral trade between the two countries topped $5 billion, 80% of which is Zambian exports to China. Much of this trade is focused on the country’s copper production. Despite already being the second largest copper producer in Africa, President Hichilema has committed to growing the industry further, doubling production between 2026 and 2032 to 3 million metric tonnes.

 The two countries are also cooperating in the technology sector. Last week, it was announced telecommunications firm MTN, in partnership with Chinese company Huawei, would be launching a 5G network in Zambia. The network is hoped to service 65% of the populations of Lusaka, Kitwe and Ndola in addition to parts of Chingola, Solwezi and Kalumbila. The government is hoping to reach 100% internet connectivity by 2024.

Mr Qi praised the Bank of China as a bridge that facilitates exchanges between the two countries. Zambia was, in fact, the first African nation the Bank of China established itself in and since then the nation has become China’s second largest trade partner on the continent.

Musokotwane, Minister of Finance and National Planning, spoke at the celebration and praised the Bank for its role in support economic development on the continent. He added that the New Dawn administration hopes to do everything in its power to strengthen its relationship with China.

The government is attempting a rapid economic transformation to become a middle income country by 2030, just a decade after former president Lungu’s mismanagement sent the country into default. Noting China’s economic explosion in the late 20th century, Musokotwane commented that he could learn many lessons from China’s rapid development.

Speaking on Wednesday, Musokotwane confirmed the two countries were in “active engagement” over the restructuring of Zambia’s debts to Chinese creditors. Renegotiations are ongoing, but with the Bank of China’s presence and the impressive foreign investment pledges recently reported by the Zambia Development Agency, it is hoped the China-Zambia relationship will grow and Zambia will take a more prominent place on the global economic stage in the years to come.

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Joint Statement Between Costa Rica, the Netherlands, the Republic of Korea, the Republic of Zambia, and the United States on the Announcement of the Second Summit for Democracy

The White House Press Office, November 30, 2022

Today, we the governments of Costa Rica, the Netherlands, the Republic of Korea, the Republic of Zambia, and the United States are pleased to announce that our leaders will co-host the second Summit for Democracy on March 29-30, 2023.

Building on the first Summit for Democracy held in December 2021, this gathering will demonstrate how democracies deliver for their citizens and are best equipped to address the world’s most pressing challenges.

We are living through an era defined by challenges to accountable and transparent governance. From wars of aggression to changes in climate, societal mistrust and technological transformation, it could not be clearer that all around the world, democracy needs champions at all levels. Together with other invitees to the second Summit, we look forward to taking up this call, and demonstrating how transparent, accountable governance remains the best way to deliver lasting prosperity, peace, and justice. 

The second Summit for Democracy will assemble world leaders in a virtual, plenary format, followed by hybrid gatherings in each of our countries with representatives from government, civil society, and the private sector. Together, we will showcase progress made by Summit partners on commitments during the Year of Action, and will reaffirm the vitality of the democratic model and collective action to meet the unprecedented challenges of our time.

We look forward to another successful Summit, and accelerating concrete action toward democratic renewal.

USAID Launch Business and Trade Development Projects in Zambia

The Zambian Minister of Finance and the U.S. Ambassador to Zambia have announced the launch of two economic development projects known as the USAID Business Enabling Project and the USAID Trade Boost.

The $24 million dollar (K233 million) Business Enabling Project is being funded by the U.S. government. According to a statement by USAID, “the project will support the development of an enabling environment that incentivises investments in trade, agriculture, energy, eco-tourism, and sustainable natural resource management.” USAID wish to make small improvements to business owners’ perceptions of the regulatory and investment environment in the country. The programme also hopes to strengthen policy-making alongside the Zambian government through linkages with select civil society organisations in order to promote economically viable and gender-balanced rural enterprises. 

This project will work alongside existing government projects to strengthen smallholder farmers. In September, the government confirmed the reform of their agricultural support into the new Comprehensive Agricultural Support Programme. From 2023 the Zambian government is aiming to increase the number of extension support officers, extend the reach of irrigation channels, and facilitate greater access to finance. The Business Enabling Project will support these efforts.

The USAID Trade Boost is set to invest $30 million dollars (K500 million) through the Prosper Africa ‘Africa Trade and Investment Programme’. The aim of the programme is to boost trade and investment through climate-friendly economic approaches. Prosper Africa is a U.S. Government initiative to bring U.S. companies into African markets – the Boost will prioritise co-investment with the private sector to produce inclusive growth. Through the Public-Private Dialogue Forum, the Zambian government hope to encourage structured, participatory, and inclusive public-private sector cooperation in order to stimulate the Zambian economy with the goal of reaching middle-income status by 2030.

U.S. Ambassador Michael Gonzales told attendees at the launch event that by making it easier to do business in Zambia “these projects will help Zambian businesses to produce more, create jobs, and provide a broader variety of healthy food options in markets.”

Zambia is actively seeking cooperative partnerships with international organisations and civil society groups. Indeed, this week a delegation from Zambia met with representatives in Berlin to discuss the future of development cooperation between Zambia and Germany. The German delegation spoke positively about President Hichilema’s attempts to improve accountability and transparency in the country, two vital aspects of a strong investor climate. 

It is hoped the U.S.-led projects will boost agricultural production and exports within Zambia in order to both alleviate the food crises in neighbouring countries, brought about by Russia’s invasion of Ukraine, and stimulate Zambia’s economy as President Hichilema and his administration continue to strive to meet the goals of the Eighth National Development Plan. USAID is hoping for the projects, in conjunction with existing programmes, to create an economic environment in Zambia capable of addressing problems and generating growth across agriculture, clean energy, and eco-tourism whilst creating equitable opportunities for women and youth through increased access to capital.

How One NGOs Drive for Conservation is Boosting Zambian Tourism

The NGO Conservation Lower Zambezi (CLZ), in conjunction with the Department of National Parks and Wildlife (DNPW), has led a remarkable rejuvenation of Zambia’s Lower Zambezi National Park. With wildlife rebounding, new riverside boutique campsites have the potential to bring back more tourists and economic growth to the Zambezi.

The Lower Zambezi National Park is one of the country’s most important wildlife sanctuaries, home to extraordinary elephant populations, lions, and much more. The park now appears as a haven of extraordinary African diversity. Yet it was not always so.

 From the 1970s through to 2016, the park experienced an epidemic of poaching. According to one local guide, this was a time “when we were being hammered by poachers, animals were rapidly disappearing.”

While the park witnessed a number of tragic losses, it was elephants that were particularly targeted. “When I started flying down here 20 years ago, I’d take off and see 20 poachers’ bushmeat drying racks in a morning, lion prides were moving from one carcass to another,” comments Ian Stevenson of CLZ. “We were being hit hard. In 2015 alone, which was the peak of the crisis, we lost 107 elephants,” he continues.

DNPW and CLZ have led the charge to protect the park and have overseen an impressive transformation. Founded in 1994, they have contributed significantly to stabilising elephant populations and the growth of sustainable tourism. In conjunction with the DNPW, their patrols act as a visible deterrent to potential poachers. In 2021 alone, they supported 14,378 man-days worth of anti-poaching patrols and apprehended 214 suspects.

The government of Zambia has removed visa requirements, and their consequent fees, for travellers coming from the EU, China, and the US. The increase in ease of access to Zambia as a holiday destination is designed to boost the number of foreign visitors, making it all the more important that tourism and sustainability come hand in hand.

NGOs have undertaken fantastic work in Zambia to this end. Ian Stevenson, CLZ’s CEO, was nominated for the Tusk Conservation Award in 2020. Tusk, one of Africa’s largest conservation charities, recognises those doing extraordinary conservation work on the continent. The charity’s patron, Prince William, personally thanked CLZ and Ian Stevenson for this work.

Working in partnership with like-minded stakeholders is a crucial part of CLZ’s success. CLZ is partially dependent on tourism for its activities. Safari companies are reliant on the beauty and biodiversity of the park to sustain their business. They, thus, support CLZ’s conservation work by contributing up to $1,000 a month and often consult with their experts on how to mitigate the impact of their visitors. 

Beks Ndlovu, founder and CEO of African Bush Camps, describes the views of the Zambezi as "like being in an oil painting" and is eager to share its natural beauty with the world. From your room at Lolebezi, one of African Bush Camps' newest sites, you can watch buffaloes run down the riverbanks, leopards lick their wounds in the trees, and hyenas gorge on scraps.

Time + Tide, a luxury safari company, has established a tented camp on the confluence of the Chongwe and Zambezi river. With 8 tents located right on the riverfront and a number of experiences on offer, Time + Tide brings tourists close to the action. Their extraordinary offering includes walking safaris, boat trips on the river, and sleepouts under the stars. Dining under the Albida trees, the work of CLZ means guests can see elephants at an extraordinarily close range as they seek to graze on their favoured snack of Albida pods.

Tourism Minister Rodney Sikumba has recently called for more investment in the sector as he perceives untapped potential to spur economic growth. The hospitality, retail, and catering sectors all benefit from increased traffic at tourist sites. The Minister said he was "extending an olive branch to would-be investors" to explore the natural beauty of the country.

Furthermore, the World Bank recently announced they would be investing $100 million to boost tourism in the country. Specifically, the project is set to renovate airstrips and bridges in Liuwa Plain National Park. This will help the delegated infrastructure accommodate a rise in tourists. The project is part of a broader plan to develop and better integrate the western tourism circuit in the country. 

Mr. Sikumba wishes to see further investment in communication networks between popular tourist destinations to extend the stay of visitors to Zambia. His sentiment is echoed by the president who, on a recent trip to Tanzania, emphasized how African nations should be doing more to package their tourist offerings not as individuals, but as a packaging opportunity to stay longer, explore the region as a whole, experience the culture and diversity of the landscape while bringing more revenue to help both sustainability initiatives and the wider economy.

With the conservation work of CLZ and many others continuing, it is hoped that the Lower Zambezi National Park can continue to flourish while attracting tourists from around the world.

5G will enhance economic development-Hichilema

Lusaka Times, 25 November 2022

President Hakainde Hichilema says technology has the capacity to transform all the social and economic sectors of life ranging from education to agriculture. Mr Hichilema says Zambia stands to benefit immensely from the commercial launch of the 5G network, which has the capacity to turn around the country’s economic landscape.

Speaking during the launch of 5G network by MTN Zambia Limited in Lusaka yesterday, Mr Hichilema said the positive and sound life of the economy can only be enhanced through advancements in technology.

The President added that the technological advancements which have been introduced in the country are in line with the government’s ambitious programme to grow the economy.

He explained that the launch of 5G will create jobs and business opportunities in the country especially in the area of small and medium enterprise development. The President further said improved technology is a catalyst to transform the mining sector.

He has since urged the mining sector in Zambia to use 5G to enhance collaboration with experts in South Africa and others to ramp up production. He added that the education sector will also benefit from the commercial launch of 5G in the country.

In the area of agriculture and tourism, President Hichilema said communication will filter quickly to farmers and the tourism sites which are found in far flung areas.

The President said livestock farmers are yet to benefit from the connectivity as information will reach them faster wherever they are across the country.

He said the introduction of 5G is in line with the Eighth National Development Plan (8NDP) which aims at job creation and improving people’s lives.

And Minister of Technology and Sciences, Felix Mutati, noted that 5G will improve mobile money services which will transform the lives of the people, especially entrepreneurs.

He said the progressive policies which the new administration has brought in the telecommunication industry will change the economic development of the country.

Mr Mutati added that the digital transformation will address the business challenges the country has been faced with for some time.

“Indeed, Zambia is entering and breaking new grounds in terms of connectivity following this 5G launch we are witnessing today,” he said.

Meanwhile, MTN Chief Executive Officer Bart Hofker stated that 5G will optimise the speed of connectivity which will in turn develop economic and social activities in the country.

Mr Hofker said MTN is the champion in the digital world and will continue to connect countries in Africa.

He added that Zambia is the third country to be connected to 5G after South Africa and Nigeria.

He said huge sums of money have been invested in expanding connectivity across Africa in order to better people’s livelihoods.

“Let us embrace 5G as it is here to transform the social economic journey the government has embarked upon to better the lives of the people,” he said.

Zambia Economic Growth Forum 2022

International Growth Centre, November 28, 2022

The International Growth Centre (IGC) hosts the Zambia Economic Growth Forum 2022 (EGF) in partnership with the Government of Zambia by convening senior political and departmental leadership, researchers, and development partners to discuss the barriers to economic growth, identify opportunities for reform, and encourage research-policy collaboration.

His Excellency President Hakainde Hichilema delivers the keynote. IGC also invites ministers, senior departmental leadership, diplomats, and members of civil society to join the conversation. Partners from outside of Zambia, including Ethiopia and Kenya, also join to share cross-country experiences in key areas. 

The EGF also aligns with the re-establishment of IGC’s resident country program in Zambia.

Please download the programme here for more information.