Zambia Investor Briefing: February 2024
OVERVIEW
President Hakainde Hichilema addressed the opening session of Cape Town’s Investing in African Mining Indaba earlier this month. His speech emphasised Zambia’s message of “Invest with Confidence” and highlighted recent investments in the country totalling over $4 billion in the past two years. Hichilema also outlined his government’s work with local and international partners in boosting Zambia’s energy and transport infrastructure as he called for investment partnerships to “power this new, green African future”.
KoBold Metals, a mining consortium backed by tech giants Bill Gates and Jeff Bezos, has announced its discovery of a vast copper deposit in Zambia. The California-based startup claims its Mingomba site, in the northern Copperbelt province, is the country’s largest copper deposit in a century.
President Hakainde Hichilema, together with Senior Advisor to President Biden Amos Hochstein and President of the Africa Finance Corporation (AFC) Samaila Zubairu, convened an investment forum for the Lobito Corridor project in Zambia. The Partnership for Global Infrastructure and Investment (PGI) Lobito Corridor Private Sector Investor Forum in Lusaka brought together over 250 government and industry leaders from Zambia, Angola, the DRC, the EU and the US, as well as international investors.
The Zambian Kwacha is Africa’s best-performing currency in 2024 when compared to the US dollar. The currency is on its longest winning streak in a year, largely because of President Hakainde Hichilema’s government’s decision to increase interest rates and mandate that the central bank retain money in the reserve.
German company 7YRDS Group is set to invest $100 million in two solar projects in Kafue and Sesheke, with a total expected output of 100MW. Operations will commence in 2025 and are expected to create around 1,000 jobs. President Hichilema praised the investment and emphasised his government’s commitment to collaboration with international partners to strengthen Zambia’s energy sector.
In a positive development in the ongoing efforts to restructure Zambia’s debt, Hichilema has announced that China and India – the last two countries that had been yet to sign as official creditors – have signed agreements to restructure their holdings of Zambian debt. Attention now turns to private creditors. Finance Minister Situmbuko Musokotwane had recently expressed optimism that the restructuring would be completed in the first half of this year.
A CLOSER LOOK
Investing in African Mining Indaba 2024
President Hakainde Hichilema addressed the opening session of Cape Town’s Investing in African Mining Indaba earlier this month. His speech emphasised Zambia’s message of “Invest with Confidence” and highlighted recent investments in the country totalling over $4 billion in the past two years. Hichilema also outlined his government’s work with local and international partners in boosting Zambia’s energy and transport infrastructure as he called for investment partnerships to “power this new, green African future”.
First Quantum Minerals (FQM) pledged its support for the president’s vision for the future of Zambian mining in a talk given by the company’s Lead of Infrastructure Development, Jed Goldstein, in which he stressed FQM’s “commitment to Zambia”. The government’s efforts also garnered praise from Anglo American CEO Duncan Wanblad, who said Zambia “is doing a really good job of making mining investable in that country”.
Mining Developments
KoBold Metals, a mining consortium backed by tech giants Bill Gates and Jeff Bezos, has announced its discovery of a vast copper deposit in Zambia. The California-based startup claims its Mingomba site, in the northern Copperbelt province, is the country’s largest copper deposit in a century. KoBold’s founder and president Josh Goldman told the Financial Times: “We now know that Mingomba will be one of the very highest grade large copper mines when put into production”, comparing it to the Kamoa-Kakula mine in the DRC in scale and grade.
The startup deploys artificial intelligence in its exploration for minerals, including copper, cobalt, nickel and lithium. KoBold’s plans to build a $2 billion mine at Mingomba are set to be fast-tracked in the rush to meet demand for critical metals as part of the green energy transition. Goldman told Reuters the company is “receptive to conversations about all kinds of different partnerships” in this regard. If successful, the project will be instrumental in meeting Hichilema’s aim to treble Zambia’s copper output to 3 million tonnes by 2032.
KoBold is also set to expand its presence in Zambia after signing a deal with Midnight Sun Mining to explore its Dumbwa Target in Solwezi.
In other mining news, Anglo American is in the early stages of exploring for copper and cobalt in the North-Western Province, with its CEO Duncan Wanblad announcing that Zambia’s mining sector is “on track for renewed activity”.
Rail Development Projects
President Hakainde Hichilema, together with Senior Advisor to President Biden Amos Hochstein and President of the Africa Finance Corporation (AFC) Samaila Zubairu, convened an investment forum for the Lobito Corridor project in Zambia. The Partnership for Global Infrastructure and Investment (PGI) Lobito Corridor Private Sector Investor Forum in Lusaka brought together over 250 government and industry leaders from Zambia, Angola, the DRC, the EU and the US, as well as international investors, in order to “unlock the enormous potential of this region”. Various commitments were announced during the PGI Forum, including a $250 million investment to support the project from the US International Development Finance Corporation.
Speaking at the forum, President Hichilema described the Lobito Corridor as a “once in a lifetime” opportunity for Zambia’s development. It will significantly reduce transport time for the country’s mining output, including copper and cobalt, to reach the coast. The rail line has its first user lined up after Canada’s Ivanhoe Mines signed a deal with commodities trader Trafigura Group to transport copper on the line from the DRC to Lobito.
Also this month, China announced plans for a $1 billion project restoring a rail line connecting Zambia’s copperbelt region with the Tanzanian port of Dar es Salaam. This follows reports from November 2023 that the Chinese government had asked China Railway Construction Corp., a state-owned company, to negotiate a concession to revive and operate the Tazara railway. The line has fallen into disrepair in past decades but originally had a capacity of about five million tonnes per year. Hichilema has said Zambia is on track to conclude the deal by September.
OTHER NEWS
How five southern African countries worked to put KAZA on the map (Forbes, 07.02.24)
Canadian government hails Zambia as attractive mining investment destination (Lusaka Times, 13.02.24)
Zambia’s Proflight adds Cape Town to its list (eNCA, 22.02.24)
US bets on $2.3 billion African railway to help deliver EV revolution (Bloomberg, 21.02.24)
Modern mining: A sustainability balancing act (African Business, 26.02.24)
UPCOMING EVENTS
Bonds, Loans & ESG Capital Markets Africa 2024 - Cape Town, SA, 05-06.03.24
Global Trade Review Africa 2024 - Cape Town, SA, 07-08.03.24
Global Impact Summit: Sustainable Media and Publishing for Sustainable Economic Development - Livingstone, Zambia 07-09.03.24
Fintech Spotlight: Moving Africa’s Money (Invest Africa) London, UK - 21.03.24
Halfway through HH’s presidency, Zambia’s future looks brighter than ever
Having passed the halfway point of his first term, President Hakainde Hichilema has already delivered a great deal of positive change for Zambia.
His leadership has brought tangible progress in empowering local communities - most notably through his Education for All scheme and the successful expansion of the Constituency Development Fund (CDF) – as well as making great strides in strengthening the economy by increasing investor confidence and working towards a debt restructuring agreement. His achievements mark a pivotal moment for Zambia, where democracy, economic growth, and social progress intersect to create a bright future.
To mark this important milestone in HH’s presidency, Zambia Is Back counts down the president’s most impactful policies and reforms.
1. Delivering free education
Hichilema's pivotal achievement of free education to all citizens of schooling age has ushered in a transformative era for Zambia. Since 10 January 2022, when the UPND’s free education programme began, nearly 2.3 million children have had their access to education restored.
Hichilema’s unwavering commitment to education was reflected in the inaugural national budget, where a 10.4% allocation - the largest in five years - was earmarked for the sector. In 2023 the allocation rose to 13.9% in order to fortify the education system's foundation.
The government's initiatives extend beyond budget allocations. Grants for primary and secondary schools have doubled, accompanied by the recruitment of 30,000 teachers and plans for the construction of over 100 new secondary schools. This surge in educational infrastructure not only creates immediate employment opportunities but also promises an educated and well-balanced future workforce.
Hichilema's vision includes further reducing teacher-to-student ratios in the coming years, so that every child will get the academic attention they need. The administration is well on its way to providing a desk for each child. This feat has been made possible through the substantial expansion of the Constituency Development Fund (CDF), enabling educational equity across the provinces.
With so many children now able to access a full education, Hichilema's presidency signifies a watershed moment in Zambia's educational landscape. Access to quality education is no longer a privilege but a fundamental right for all citizens, and the groundwork is laid for a more prosperous and equal society.
2. Boosting private sector investment
Hichilema is steering economic recovery by restoring the confidence of business and industry in Zambia and thereby encouraging investment in the country. In the period since he took office, international investment has risen from $3.31 billion to at least $37 billion.
A key area of investor confidence is mining: with a goal to treble the country’s copper output by three million tonnes per year by 2032, Hichilema is working to cement Zambia’s position as a major player in the global mining industry. The country has some of the highest-grade copper in the world, and the metal is key to the green energy transition.
Earlier this month, US-based mineral exploration company KoBold Metals found the largest copper deposit the country has seen in a century at its Mingomba site and intends to expedite its $2 billion investment. Hichilema has also struck a deal with Canadian-based First Quantum Minerals (FQM) in the form of a $1.25 billion investment in the expansion of its Kansanshi mine, and a further $100 million to complete the Enterprise nickel mine, which will be one of the largest nickel mines in the world. Meanwhile, Barrick Gold has fast-tracked its $2 billion expansion of Lumwana copper mine.
Investments are creating thousands of jobs for Zambians: since August 2021 over 20,000 jobs have been actualised and a further 112,000 have been committed. The expansion of Kansanshi mine alone will create another 1,800 jobs this year.
Hichilema has also been successful in encouraging foreign investment in the renewable energy sector, commitments to which have increased eightfold from $2 billion in 2021 to $16.1 billion in 2023. This is succeeding in propelling Zambia to the forefront of the green energy transition. Recent developments in this area include the partnership Hichilema agreed with the British government covering clean energy and critical mineral supply worth more than $3.7 billion. Green investment is also enabling the diversification of Zambia’s own energy sources, such as the recently announced project by German-owned 7YRDS to build two large solar projects.
The president’s unwavering dedication to Zambia's economic revival is evident through his strategic approach to foreign investment. Under his leadership, the private sector is experiencing unprecedented growth, fuelling job creation and working towards economic prosperity.
3. Empowering communities through CDF
President Hichilema’s administration has taken a groundbreaking step towards regional development and community empowerment through the significant expansion of the Constituency Development Fund (CDF) in the 2022 budget. Allocated funds have increased from just K1.6 million in former President Edgar Lungu’s budget to a substantial K25.7 million in Hichilema’s first budget and a further K28.3 million in his second.
This large increase gives greater power to communities to foster grassroots change. The new approach grants autonomy to each constituency, allowing it to directly address its most pressing needs in areas such as healthcare, education, vocational training, infrastructure, waste management, and agriculture. It is through investment in local communities that Zambians will gain skills and support to explore their careers and contribute to the economy.
The CDF is delivering lifechanging infrastructure development, such as at Chipata level-one hospital in Lusaka, where CDF funding has increased staff levels and provided up-to-date equipment, improving the quality of medical care for citizens.
This bottom-up approach to development promises to actively address issues of corruption and lack of investment in rural Zambia, fostering a more inclusive and prosperous nation. In essence, the expanded CDF signifies a shift towards people-powered progress, putting the tools for economic advancement directly in the hands of those who need it most.
4. Strengthening democracy and tackling corruption
During his tenure so far, Hichilema has strengthened Zambian democracy by encouraging freedom of expression, legislating for government transparency, and clamping down on corruption.
Hichilema has achieved a significant breakthrough for media freedom in Zambia by enacting the long-awaited Access to Information (ATI) Act after years of unfulfilled promises from previous administrations. The act enables citizens to request information from public bodies, ensuring that government processes are open and accessible to all - including those who are unable to read.
This achievement stands as a stark departure from the oppressive environment cultivated under the previous administration of President Lungu. The closure of The Post, a vital independent newspaper, served as a glaring example of the suppression tactics employed by his government. However, in 2022, a court deemed the closure illegal, and Hichilema's administration went further by repealing the law criminalising defamation of the president. Removing this act from the statute books, alongside scrapping the death penalty and plans to reform the Public Order Act, signifies a new era for freedom of expression and assembly in Zambia.
Hichilema’s dedication to transparency extends beyond the realm of media freedom. He has bolstered institutions such as the Financial Intelligence Unit (FIU) and Anti-Corruption Commission (ACC), underscoring his determination to combat corruption and uphold principles of fair governance.
Recently, Hichilema has overseen the sentencing of the former Deputy Inspector General, Charity Katanga, to three years in prison for purchasing property with illegal funds. In a country where state capture has been the modus operandi of previous presidents, Hichilema’s government is showing that corruption has no place in modern Zambia.
The UPND government represents a turning point in Zambia's trajectory, where the fundamental rights of citizens are safeguarded, and government accountability is prioritised. Through legislative reforms, the president has demonstrated his unwavering belief in the principles of democracy and freedom of expression for all, irrespective of political affiliations.
5. Restructuring historic debts
Since taking office, President Hichilema has been working tirelessly to complete the mammoth task of restructuring Zambia’s $13 billion external debt: a weighty burden he had inherited from his predecessor. In a very positive recent development, Hichilema announced on 26 February that China and India – the last two countries that had been yet to sign as official creditors – have signed agreements to restructure their holdings of the debt.
This is very welcome news and follows several months of protected wrangling between official and private creditors. In 2022, Hichilema managed to secure a provisional deal with official creditors for $6.3 billion and a separate deal with private bondholders for $3 billion, both incredible feats of negotiation which would greatly ease the country’s financial burdens. However, progress has slowed down after official creditors complained that their terms were not as favourable as those received by private lenders.
Nevertheless, things are moving in the right direction. Finance Minister Situmbeko Musokotwane expressed optimism in February that the restructuring would be completed in the first half of this year.
Hichilema is walking through uncharted territory, fixing the corruption and carelessness of his predecessors. Although the debt restructuring is still ongoing, the current outlook looks positive, with strides taken to get Zambia back on track and bring economic stability to the nation.
Zambian Kwacha is Africa’s Best Performing Currency in 2024
This year, the Zambian Kwacha has outperformed all other African currencies when compared to the US dollar, solidifying its position as the top performer on the continent. The currency is on its longest winning streak in a year, largely because of President Hakainde Hichilema’s government’s decision to increase interest rates and mandate that the central bank retain money in the reserve.
On 5th February, the country increased the minimum reserve ratio for lenders. The interest rates are currently the highest they have been in nearly seven years. By purposefully constricting the flow of funds the Kwacha has climbed in value. This has been further supported by increasing the base interest rate just over a week later.
With the Kwacha strengthening, imports will become cheaper. As a country that relies heavily on exports for a range of necessities including fuel, foodstuffs, fertiliser, and vehicles, this is welcome news. Moreover, Zambian exports will similarly gain in value. These exports include Zambian copper, which accounts for 70% of the continent’s production, as well as gemstones, tobacco, and sugar.
Analysts have warned that the Kwacha’s positive streak—and sustainable growth of the currency—will occur only if the country can secure more international investment, something that is already being promoted across all sectors of Zambia’s economy. In particular, President Hichilema’s improvement in mining policy has attracted billions of dollars worth of international investment to the country, with the policies offering predictability and confidence.
Some optimistic projections see the Kwacha continuing to rise to 22 per dollar. In a note to clients, Mulenga Kawimbe, from the First National Bank of Zambia, stated that the bank believes “a break of the 22.00 level is possible.”
This economic engineering has boosted the Kwacha, breaking its steady decline for 75 consecutive days. Its largest fall occurred between October 16th and February 5th, dropping 21% against the US dollar.
Zambian officials have credited the currency’s fall to hampering international investment because of stalled debt restructuring talks. Since then, Secretary to the Treasury Felix Nkulukusa has assured that Zambia is “on course to reach a new agreement.”
Ivanhoe signs up to be US-backed African rail line’s first user
Ivanhoe Mines Ltd., chaired by billionaire Robert Friedland, and commodities trader Trafigura Group signed deals to transport copper by rail from the Democratic Republic of Congo to neighboring Angola’s port of Lobito, marking the first long-term deal for the railway project that the US government is backing.
Trafigura is part of the consortium that won a 30-year concession to operate the Lobito railroad that could become a key export route for DRC’s fast-growing production of copper and cobalt — both crucial metals for the energy transition. Ivanhoe says the route could drastically cut transport times and lower emissions.
“This is fantastic news for the Congo,” Friedland said in a speech in Cape Town Wednesday. “This brings the mineral rich region of the Congo to world markets. And this kind of infrastructure development is critical for the development of the African continent.”
Mining companies operating in the copper belt that straddles Congo and Zambia have traditionally trucked their metals down to South Africa’s Durban port. This journey can take more than a month. Lobito promises to cut trip times to less than a week, to an Atlantic port that’s closer to the US and European Union. Both powers are backing the project financially, as part of their efforts to counter China’s heavy influence in the region.
The US has committed $250 million to the refurbishment of the line in Angola, and is funding a study to link the railway into Zambia as part of a project that will cost an estimated $1.6 billion. That’s part of an acceleration of US investment in Africa, said Amos Hochstein, senior adviser to US President Joe Biden for energy and investment. It’s also catalyzing private investment, he said.
Infrastructure is emerging as a key investment area for funds including BlackRock Inc., led by Larry Fink.
“We’ve seen a transformation from the financial industry worldwide but especially in the US from some skepticism to a realization that this is the new frontier of investment to enable the kind of supply chains that we are going to need,” Hochstein said in an interview Tuesday. “There’s interest in real investment, and translated from not just Larry Fink talking about it but we’re seeing money being put to action, money being raised for the purpose of infrastructure in low and middle income countries.”
The Lobito Atlantic Railway concessionaires, which also include Mota-Engil and Vecturis, will ramp up the line’s export capacity to one million tons yearly by the end of the decade, Trafigura said in a statement Wednesday. Trafigura’s export capacity allocation on the line will be 450,000 tons from 2025.
Ivanhoe’s massive Kamoa-Kakula copper mine, jointly owned with Zijin Mining, has agreed an allocation of between 120,000 tons and 240,000 tons.
This article originally appeared on Bloomberg
Bill Gates-backed mining company discovers vast Zambian copper deposit
A mining start-up backed by Bill Gates and Jeff Bezos says it has discovered a vast copper deposit in Zambia, offering a potential boost to the west’s efforts to cut its reliance on China for metals that are vital to decarbonise everything from cars to power transmission systems.
KoBold Metals said on Monday that it had found Zambia’s largest copper deposit in a century, estimating that the Mingomba site in the northern Copperbelt province will become one of the world’s top three high-grade copper mines.
The discovery comes as the US government embarks on a charm offensive and infrastructure push in Africa in an effort to compete with China’s control over minerals that are critical for defence, renewable power and electric vehicles. The US government is backing the development of the Lobito railway, a line to transport metals in the region connecting the Democratic Republic of Congo and Zambia to the Lobito port in Angola.
While demand for copper is forecast to soar as countries set up efforts to electrify their transportation systems and pivot to renewable energy, the world’s largest mining companies are struggling to find high-quality assets.
Copper, which is widely used in construction and industry, is expected to undergo a boom in demand as it is heavily used in power transmission lines, electric vehicles and wind turbines.
“We’ve spent a year with the largest fleet of drilling rigs in Southern Africa,” Josh Goldman, founder and president of KoBold Metals, told the Financial Times. “We now know that Mingomba will be one of the very highest grade large copper mines when put into production and it’s very much like Kakula in scale and in grade.”
KoBold expects Mingomba will rival output at the deposit that is part of US billionaire Robert Friedland’s giant Kamoa-Kakula project in the Democratic Republic of Congo.
Backed by Breakthrough Energy Ventures, a climate change investment vehicle founded by Bill Gates, KoBold deploys artificial intelligence to scrape historical geological archives — including old PDFs and even maps hand painted on linen — and uses algorithms to help decide where to explore for minerals.
The California-based company is valued at $1.15bn, and also counts BHP, the world’s largest mining group, and oil major Equinor, as investors.
KoBold aims to start producing copper at the $2bn underground mine by the early 2030s.
The project is yet to conduct a pre-feasibility study, which provides early estimates of project costs and how economically the metal can be extracted.
If successful, the project would play a big role in meeting Zambian president Hakainde Hichilema’s ambition to more than treble the country’s copper output to 3mn tonnes by 2032, and help the nation dig its way out of debt.
Spending by the world’s biggest mining companies on copper exploration was small relative to volume of the metals the world was expected to need, Goldman said. Exploration companies, meanwhile, were struggling to raise capital because of interest rate hikes, he added.
“Exploration is where babies come from. You can help babies grow but you’ve got to get the birth rate up,” said Goldman. “That’s the hardest part: how do you find things in the first place.”
Goldman added that the company was evaluating a public listing in the next three or four years.
This article originally appeared on Financial Times
Zambia Investor Briefing: January 2024
OVERVIEW
At the end of December, Zambia’s Copperbelt Energy Corporation Plc (CEC) announced the successful registration of its $200 million Green Bond with the Securities and Exchange Commission, the first in Zambia. CEC Managing Director Owen Silavwe said the bond’s proceeds would “accelerate the actualisation of our ambitions to generate at least 200MW of renewable energy and specifically solar energy with possible storage implementation”.
Barrick Gold’s chief executive Mark Bristow met with President Hakainde Hichilema to inform him the expansion of Barrick’s Lumwana copper mine is being accelerated, with first production now scheduled for 2028. Last year the company had pledged $2 billion in a bid to increase copper production to a projected 240,000 tonnes per year and extend the life of the mine to 2060.
SG Global Renewables Centre (GRC), a Scotland-based hub for facilitating knowledge exchange between international development partner countries and the Scottish renewables sector, has formalised a partnership with the Zambia Renewable Energy Association (ZARENA), as well as in Malawi and Rwanda. GRC offers networking, shared learning, and resources to enable increased deployment of sustainable energy in its partner countries. Chairman of ZARENA Jospeh Mutale said the initiative would support the association’s objective of “delivering a transformative impact on the roll out of sustainable renewable energy solutions in Zambia”.
Zambia’s Transport and Logistics Ministry has announced plans to build a new rail connection linking Mpulungu harbour on Lake Tanganyika to a line that runs to Tanzania. The proposed 192km line will run through northern Zambia to the lake’s southernmost harbour and will boost trade in the region. The Transport and Logistics Ministry has asked companies to express their interest in financing and building the concession.
Minister of Science and Technology Felix Mutati has announced plans to establish Community Digital Transformation Centres (CDTCs) across the country in order to enhance Zambia’s digital capabilities and empower citizens through training and online service delivery. The plans have been developed on the back of Zambia’s recent partnership with Starlink, SpaceX’s satellite internet service, which is providing lawmakers with Starlink kits in their constituencies and enables internet connectivity even in remote areas.
Zambia’s “investment promotion ambassadors” visited Davos for the World Economic Forum annual meeting. The delegation included Finance and National Planning Minister Dr Situmbeko Musokotwane; Commerce, Trade and Industry Minister Chipoka Mulenga; and Albert Halwampa, Director General of the Zambia Development Agency (ZDA). Musokotwane said regarding the trip, “We are here to make diligent efforts to attract the best available global investment prospects in the green economy, mining, agriculture, tourism, value-addition, human development, and other growth boosting ventures, to our beloved country Zambia”.
Zambia Is Back’s Choolwe Chibomba sat down to interview Monica Musonda, CEO of Java Foods. They covered topics such as her business journey, the role of women in Zambia’s economic development, and why now is the time to invest in Zambian businesses.
President Hichilema is due to deliver a keynote address at Invest in African Mining Indaba 2024 in Cape Town next week. He is expected to discuss the future of mining in Zambia, outlining his plans to expand copper production and position the country as a major player in the global mining industry. He will also address efforts for Zambian mining to expand into a wider array of critical minerals, including cobalt, nickel, and manganese. The president’s speech will also explore the potential for collaboration between the government, industry stakeholders, and investors.
A CLOSER LOOK
Copperbelt Energy Corporation registers Zambia’s First $200 Million Green Bond
At the end of December, the Copperbelt Energy Corporation Plc (CEC) announced the successful registration of its $200 million Green Bond with the Securities and Exchange Commission, the first in the country. The company, which is based in Zambia, provides power infrastructure solutions. CEC Managing Director Owen Silavwe said the bond’s proceeds would “accelerate the actualisation of our ambitions to generate at least 200MW of renewable energy and specifically solar energy with possible storage implementation”.
The bond aligns with Zambia’s Green Growth strategy, devised by Hichilema’s government. The strategy aims to decarbonise the economy by developing resource-efficient and climate-resilient infrastructure. The Minister of Green Economy and Environment Collins Nzovu spoke at COP28 about the government’s establishment of two regulatory frameworks to aid in this endeavour: the Green Bonds Framework issued by the Securities and Exchange Commission and the Green Loans Framework issued by the Bank of Zambia.
Proceeds from the bond will finance the development of solar generation projects in Zambia within the CEC Group through CEC Renewables, an investment vehicle designed to realise renewable energy development. According to a statement issued by CEC, the bond is “a first for Zambia’s capital markets and is expected to attract more green finance in the country”. CEC’s announcement highlights the increasing importance of green bonds in financing clean energy infrastructure, and the role played by capital markets within this.
Investors in the Green Bond include Emerging Africa Investment Fund, ABSA Bank, Atlas Mara Bank Zambia, and the African Local Currency Bond (ALCB) Fund.
OTHER NEWS
IMF releases $187 million Zambia payout, says restructuring proposal being revised (Reuters, 20.12.23)
Albert Muchanga: New transport corridors will be ‘catalyst for AfCFTA success’ (The Africa Report, 04.01.24)
Zambia aims to resolve debt revamp standoff within three months (Bloomberg, 04.01.24)
Zambia: $10m company proves small farms can be big business (How We Made It In Africa, 09.01.24)
WEF Davos 2024: How Africa can achieve commodity-led industrialisation (African Business, 17.01.24)
India to send industry delegation for copper mining opportunities in Zambia (Indian Express, 22.01.24)
How could artificial intelligence help pregnant women in Zambia? (Forbes, 28.01.24)
UPCOMING EVENTS
Cape Town, SA:
Investing in African Mining Indaba 05-08.02.24
121 Mining Investment 05-06.02.14
Invest Africa Mining Series 05-07.02.24
Nairobi, Kenya:
Africa Tech Summit 14-15.02.24
Sankalp Africa Summit 2024 28-29.02.24
Other:
SAVCA Private Equity Conference 28-29.02.24, Stellenbosch, South Africa
Pension Funds & Alternative Investments Africa Conference 28-29.02.24, Mauritius
President Hichilema to Deliver Keynote at Mining Indaba 2024
Mining Indaba is honoured to announce that Zambia’s President Hakainde Hichilema will deliver a keynote address in 2024
Zambia’s President Hakainde Hichilema is set to deliver a keynote address at Mining Indaba 2024, demonstrating his unwavering dedication to revitalising his country’s mining sector and delivering jobs and economic growth to the people of Zambia.
This will be Hichilema’s second appearance at Mining Indaba as President, having delivered a keynote address in May 2022, shortly after his landslide election victory in 2021.
Since this historic election, President Hichilema has made quick progress towards achieving his objectives, implementing several measures to revitalise the mining sector in Zambia. Already the seventh largest copper producer in the world, Hichilema has set out to advance Zambia’s ranking with an ambitious goal of expanding copper production from 800,000 tonnes per year currently to around 3 million tonnes of copper by 2030.
Under Hichilema’s leadership, the Government of Zambia has reviewed the mining tax framework, ensuring a stable and competitive taxation system while eliminating double taxation. Furthermore, President Hichilema has personally spearheaded efforts to attract investment along the mining value chain, exemplified by the signing of a memorandum of understanding with the Democratic Republic of Congo to build a regional value chain for electric vehicle batteries. These initiatives have already yielded positive results, with major mining groups reinvesting in Zambia and the country's copper opportunities gaining renewed interest from global players.
During his keynote at Investing in African Mining Indaba, the President is expected to delve into the future of mining in Zambia, outlining his plans to expand copper production and position the country as a major player in the global mining industry. He will also address efforts for Zambian mining to expand into a wider array of critical minerals including cobalt, nickel and manganese. Furthermore, Hichilema’s speech will explore the potential for collaboration between the government, industry stakeholders, and investors, highlighting the need for partnerships to drive innovation and maximise the sector's socio-economic benefits.
Just two years into Hichilema’s presidency, there have already been numerous positive developments in Zambia’s mining industry. Since 2019, Barrick’s Lumwana mine has contributed nearly US$3 billion in taxes, royalties, and local employment. In October 2023, the company made clear its support for the Zambian economy by announcing it will invest almost $2 billion to expand Lumwana and increase its annual production to an estimated 240,000 tonnes of copper. This will elevate a once unprofitable operation into one of the world’s foremost copper production facilities.
Similarly, a $100 million investment by First Quantum Minerals (FQM) has successfully brought the Enterprise Nickel Mine – Africa’s largest nickel producer – online. Meanwhile, FQM’s $1.25 billion expansion to its Kanshansi Copper Mine – announced at the Investing in African Mining Indaba 2022 – is expected to create nearly 2,000 jobs in Zambia.
Hichilema’s visionary and steadfast leadership has also encouraged new players to make their mark in Zambia. California-based Kobold Metals, which is backed by tech titans including Bill Gates and Jeff Bezos, is working to start producing copper and cobalt at its project in Zambia. The company has so far invested $150 million to accelerate its search for high-quality metal deposits located in the famous Copperbelt.
Other newcomers include Abu Dhabi’s International Resources, who in December 2023 announced a $1.1 billion investment in Mopani Copper Mines, funding the mine’s expansion plan and increasing copper production to 200,000 tons in the next three years.
President Hichilema’s leadership has galvanised not just the mining industry but also related industries that provide much needed infrastructure and support to the extractives sector. On 26 October, his government signed a memorandum of understanding with the United States and European Union to develop the Lobito Corridor and build a new Zambia-Lobito rail line. This includes a $ 250 million investment by the United States and will deliver an enormous boost to intra-regional trade, as well as stimulating growth and job creation within Zambia.
Mining Indaba 2024's theme is 'Embracing the power of positive disruption: A bold new future for African Mining'. Zambia’s re-emergence as a top investment destination of choice for mining investors demonstrates that positive disruption can deliver positive results and Mining Indaba is excited to provide opportunities to understand the country’s successes and processes for achieving this.
BackChat Season 2 Episode 5: Thebe Investment Management CEO Mwiya Musokotwane
Our guest this week has been mentioned in the Forbes 30 under 30 as well as being part of the Choiseul 200 Leading Economic Leaders list! Tune in as Choolwe catches up with Mwiya Musokotwane of Thebe Investment Management as they discuss all things infrastructure development and the current investment landscape in the country, including the role that President Hakainde Hichilema has played.
BackChat Season 2 Ep. 5: Mwiya Musokotwane, CEO of Thebe Investment Management
ZIB’s guest this week has been mentioned in the Forbes 30 under 30 as well as being part of the Choiseul 200 Leading Economic Leaders list! Tune in as Choolwe catches up with Mwiya Musokotwane of Thebe Investment Management as they discuss all things infrastructure development and the current investment landscape in the country, including the role that President Hakainde Hichilema has played.
2023 In Review: Zambia's Economic Revitalisation
2023 has been a bumper year for Zambian investment, with an additional US$ 40 billion ploughed into 379 investment projects throughout the year. This represents a 300% increase on the previous year’s figure of US$8.6 billion.
Albert Halwampa, Director General of the Zambia Development Agency, attributes this transformational confidence in Zambia’s economy to the discerning policies implemented by President Hakainde Hichilema.
Speaking to ZNBC 1, Halwampa said there was a “new sheriff in town”, which explains Zambia's attractiveness to global investors. The nation has now become a hub for international business ventures, he explained, and the influx of capital has soared to new heights, signalling a surge in global interest and confidence in Zambia's economic potential.
In Halwampa's words, "We've never witnessed this level of economic activity in Zambia."
Of the monumental US$40 billion investment, a considerable US$2 billion has already been deployed, with Halwampa assuring stakeholders that projects are advancing through various stages of implementation.
He outlined that these strategic investments will soon yield substantial benefits, not only for the investors but crucially also for the citizens of Zambia.
Over the past year Halwampa, along with his dedicated ZDA team, travelled globally, identifying and evaluating diverse business opportunities for Zambia.
From cutting-edge artificial intelligence enterprises in America to the nuanced realm of almond cultivation in Italy, Halwampa has helped position Zambia as an ideal business environment across a wide array of sectors.
This dedicated effort underscores ZDA’s commitment to fostering a resilient business ecosystem that extends beyond the attraction of investment, seeking to diversify and fortify the nation's economic foundations.
As these investments are actualised in 2024 and beyond, it is clear that Zambia is well positioned to solidify its standing as a rising star of southern Africa’s rapid economic development.
What to stay up to date with Zambian investment news? Sign up to our newsletter by clicking here.
BackChat Season 2 Episode 4: Java Foods CEO Monica Musonda
Zambia Is Back spokesperson Choolwe Chibomba speaks to Monica Musonda, CEO of Java Foods, about her business journey, the role of women in Zambia's economic development, and why now is the time to invest in Zambian businesses.
First Quantum agrees with Zambian firm to fast-track copper project
LUSAKA, Dec 4 (Reuters) - Canada's First Quantum Minerals (FM.TO) and a Zambian mining company have signed an agreement to fast-track the development of a copper project in Africa's second-biggest producer of the metal, the companies said on Monday.
Zambia has ambitions to triple its copper output and has reviewed its tax policy to increase mining exploration and output.
First Quantum is already a major miner in the southern African country.
ts agreement with Zambia's Mimosa Resources envisages mining at the Fishtie copper project starting from 2026, ramping up to maximum production of 30,000 metric tons of copper a year by the end of the decade, First Quantum and Mimosa Resources said in a joint statement.
First Quantum reiterated it thought the investment climate in Zambia had improved.
Mimosa Resources is expected to lead the raising of a total investment of $200 million for the project.
Zambia Investor Briefing: December 2023
OVERVIEW
• Canadian mining giant First Quantum Minerals (FQM) has signed a deal with Zambia’s Mimosa Resources to advance the development of the Fishtie copper project in Central Province. The deal – a revised version of the Kashime Development Agreement, first announced in 2012 - will see Mimosa aim to raise the $200 million required for the project’s development. Production is slated to begin in 2026 and is expected to extract 30,000 tons of metal per year by the end of the decade. FQM’s country manger Godwin Beene said regarding the deal: “We are determined that this resource should be developed now that the investment climate in Zambia has improved”.
• During his attendance at COP28 UAE, President Hakainde Hichilema used the international platform to engage with global leaders on climate change and global development. He presented a keynote address, engaged with numerous premiers and delegates, and participated in various panels. The Zambian president gave a Keynote Intervention at the ‘Leaders’ Event on Carbon Markets’ hosted by the EU alongside EU President Ursula von der Leyen, Prime Minister of Spain Pedro Sánchez, and Kristalina Georgieva of the IMF. In his address, Hichilema detailed Zambia’s national climate adaptation policy, promoting carbon market development. He also stressed the need to actively engage with rural communities regarding carbon projects.
• During his visit to Zambia, the Bank of China’s vice-president Lin Jingzhen announced plans to promote the use of renminbi (RMB) in the country. He said: “We will earnestly act upon our responsibility and leverage our role in Zambia to provide holistic services and products related to RMB and to promote the use of RMB in bilateral trade and economic activities”. Hichilema said the Bank of China “remains committed to supporting ongoing projects” in Zambia.
• Hichilema met with France’s Secretary of State in charge of Development, La Francophonie and International Partnerships Chrysoula Zacharopoulou during her trip to Zambia. According to the president, the pair discussed the country’s goal to connect to important of trade corridors in connecting to the Atlantic and Indian Oceans. The two also signed Declarations of Intent covering a number of areas.
• Zambia Is Back’s Choolwe Chibomba sat down in an interview with British High Commissioner to Zambia Nicholas Woolley. They covered topics such as the UK’s work in supporting investment into Zambia, Zambia’s renewable energy sector, and expectations for the UK-African Investment Summit 2024. Chibomba also met with the German Ambassador Anne Wagner-Mitchell. During the interview the pair discussed German investment in Zambia, as well as the ways in which the two countries can work together to mitigate climate challenges.
• At Zambia’s first Information and Communications Technology, Postal and Courier Services awards, Minister of Science and Technology Felix Mutati announced that 4G internet is being set as standard across the country. As part of this effort to enhance Zambia’s connectivity, 2G and 3G will be eliminated.
• US President Joe Biden hosted Angola’s President João Lourenço to discuss the US contributing $1 billion to the Lobito Corridor. The Corridor is a trans-African railway line connecting Zambia and the DRC to regional and global markets through the port of Lobito on Angola’s coast. Once completed, it will offer the shortest route to transport Zambia’s exports such as critical minerals to the coast and will also greatly benefit the region’s import economy.
A CLOSER LOOK
Hichilema Attends COP28 in the UAE
During his attendance at the COP28 climate summit, President Hakainde Hichilema used the international platform to engage with global leaders on climate change and global development. He presented a keynote address, engaged with numerous premiers and delegates, and participated in various panels.
The Zambian president gave a Keynote Intervention at the ‘Leaders’ Event on Carbon Markets’ hosted by the EU alongside President of the EU Ursula von der Leyen, Prime Minister of Spain Pedro Sánchez, and Kristalina Georgieva of the IMF. In his address, Hichilema detailed Zambia’s national climate adaptation policy, promoting carbon market development. He also stressed the need to actively engage with rural communities regarding carbon projects.
In efforts to continue to strengthen Zambia’s economic diplomacy with key global players, the Zambian president held numerous bilateral meetings during his time at COP, including with French President Emmanual Macron. He also held bilateral meetings with Ding Xuexiang, China’s Vice Premier. The talks were focused on strengthening the ‘all-weather friendship’ of the two countries. In a statement posted to his Facebook page, Hichilema said: “We remain committed to building on our bilateral relations for the benefit of our two countries and peoples”.
Hichilema’s other meetings of note, held on the margins of COP, include his engagement with Antonio Guterres, UN Secretary-General. He also met with Ahunna Eziakonwa, Assistant Secretary General of the United National Development Programme, with whom he explored the idea of Zambia hosting a regional technology hub and implementing a carbon strategy framework.
OTHER NEWS
AFC leads on critical Lobito rail link project (African Business, 30.11.23)
The New Guard: South Africa, Angola, Zambia (Africa Intelligence, 06.12.23)
‘Gem in the rough’: A look at Zambia’s ever-growing emerald industry (Forbes Africa 12.12.23)
Billionaire-backed KoBold Metals widens lithium hunt across four continents (Reuters, 14.12.23)
Jubilee Metals raises $16.6m to fund Zambia copper recovery (Mining Technology, 18.12.23)
Opinion: The three ‘geos’ shine against gloomy horizon (FDi Intelligence, 19.12.23)
BackChat Season 2 Ep. 3: German Ambassador Anne Wagner-Mitchell
How can Germany and Zambia work together to mitigate climate challenges? How will the relationship between the two countries develop? What sectors within Zambia are the most promising for German investment?
Tune in to hear German Ambassador Anne Wagner-Mitchell's thoughts, alongside some exciting examples of German investment in the country.
Zambia Investor Briefing: November 2023
OVERVIEW
• Zambia has selected the UAE’s International Resource Holdings (IRH) as the new strategic equity partner in Mopani Copper Mines, according to the mine’s owner ZCCM. IRH is linked to Abu Dhabi’s most valuable listed company, International Holdings Company (IHC). Mines Minister Paul Kabuswe has said details of IRH’s investment and level of equity participation in Mopani will be revealed when negotiations are complete. It is expected to invest funds into the mine to help with short-term working capital and to finance the completion of the mine development. IRH will also work to “reset” Mopani’s existing relationship with Swiss mining conglomerate Glencore. This is good news for Zambia, which has been searching for a new investor in Mopani since the state took control of the assets from Glencore in 2021.
• Zambia has experienced a significant setback in its debt restructuring process after its official creditors, led by China, rejected a deal of almost $4 billion, despite approval in principle by the IMF. According to the finance ministry, the Zambian government “currently does not have the support” of official creditors and is “unable to move forward at this time” on a deal with bondholders. This is disappointing news, especially following October’s reports that Zambia had reached a huge milestone in its debt restructuring process. Despite this, however, the IMF has grounds for optimism that key lenders will still agree to a restructuring deal. Finance Minister Situmbeko Musokotwane has said Zambia hopes to complete the restructuring “as soon as possible” and is engaging closely with all creditors.
• President Hakainde Hichilema travelled to Italy on a two-day state visit to strengthen bilateral relations between the two countries. While there, he met the country’s president, Sergio Mattarella, with whom he discussed future opportunities to enhance Zambian development by means of alliances with Italian businesses, particularly in the industries of agriculture, mining, energy and tourism. Among the highlights of the Zambian president’s visit was his delivery of the keynote address at the Zambian-Italian Business Forum in Rome.
• Hichilema embarked on a trip to Germany where he undertook extensive economic diplomacy engagements. This included the G20 Compact with Africa, where he addressed a delegation of industry leaders in Germany. On the margins, he held bilateral talks with German Chancellor Olaf Scholz regarding the investment of German businesses in the Zambian agricultural sector.
• During his trip to Germany, Hichilema held bilateral meetings with the president of the World Bank Ajay Banga, and the IMF Managing Director Kristalina Georgieva. Both talks were focused on the need for a swift resolution to the remaining elements of Zambia’s debt restructuring programme.
• The Africa Fintech Summit was hosted this month in Lusaka. It brought together industry leaders, policymakers, investors, and entrepreneurs to explore the opportunities and challenges of the future of fintech on the continent. Technology and Science Minister Felix Mutati announced at the Summit Zambia’s plans to open a new smartphone factory by June 2024, which he hopes will “foster inclusivity when it comes to connectivity” and boost the reach of fintech startups in the country.
• According the Tanzania-Zambia railway authority, the Chinese government has asked China Railway Construction Corp., a state-owned firm, to negotiate a concession to operate a railway line connecting Zambia with the port of Dar es Salaam in Tanzania. The authority plans to revive the Tazara railway, which has fallen into disrepair in past decades but originally had a capacity of about five million tons per year. It has been a big year for Zambian rail networks: the US and EU have pledged to support the development of the Lobito Corridor, which will connect the Copperbelt region in Zambia and the DRC to Angola’s port of Lobito.
• Hichilema commissioned the Kasama Airport in the Northern Province. It is hoped the airport will serve as a “key hub for economic expansion in the northern circuit”.
Zambia Selects UAE’s IRH as New Partner for Mopani
Zambia has selected the UAE’s International Resource Holdings (IRH) as the new strategic equity partner in Mopani Copper Mines, according to the mine’s owner ZCCM. IRH is linked to Abu Dhabi’s most valuable listed company, International Holdings Company (IHC). This development signals the end to the speculation as to who would be Mopani’s investor, with South Africa’s Sibanye Stillwater and China’s Zijin previously in the running.
Mines Minister Paul Kabuswe has said details of IRH’s investment and level of equity participation in Mopani will be revealed when negotiations are complete. It is expected to invest funds into the mine to help with short-term working capital and to finance the completion of the mine development. IRH is also expected to “reset” Mopani’s existing relationship with Glencore.
The partnership is expected to increase copper production at the mine to more than 200,000 metric tons per annum, according to ZCCM. It has previously said Mopani would require $300 million in investment to expand output over the next three years, with an extra $150 million to sustain its operations.
This is good news for Zambia, which has been searching for a new investor in Mopani since the previous government took control of the assets from Glencore in 2021 and agreed to pay the company $1.5 billion in a deal funded by debt. According to ZCCM: “The proposed investment in Mopani is the largest single investment to date by IRH and represents a key step in the development of its strategy to become a major player in the African minerals sector”.
Hichilema Visits Italy to Strengthen Bilateral Ties
President Hakainde Hichilema travelled to Italy on a two-day state visit to strengthen bilateral relations between the two countries. While there, he met the country’s president, Sergio Mattarella, with whom he discussed future opportunities to enhance Zambian development by means of alliances with Italian businesses, particularly in the industries of agriculture, mining, energy and tourism.
Among the highlights of the Zambian president’s visit was his delivery of the keynote address at the Zambian-Italian Business Forum in Rome. Sponsored by the Zambian Chamber of Commerce and supported by the Zambian Development Agency (ZDA), the forum was attended by both Zambian and Italian companies.
While in Italy, Hichilema also met with both Qu Dongyu, Director-General of the Food and Agriculture Organization (FAO) and Alvaro Lario, President of the International Fund for Agricultural Development (IFAD) to discuss food and nutrition security in Zambia.
OTHER NEWS
The US and EU plan $1 billion-plus Africa rail link for key minerals 01.11.23, Bloomberg
Remittance fintech app Minit Money launches money sending to Zambia 3.11.23, Fintech Finance News
Zambia’s president calls for more bilateral cooperation with Türkiye 08.11.23, AA
Anglo starts exploratory drilling on copper licences in Zambia 13.11.23, Mining Weekly
What’s in store for China-Africa relations in 2024? 27.11.23, African Business
Koryx Copper starts a geophysical survey in Zambia 29.11.23, Yahoo Finance
UPCOMING EVENTS
SuperReturn Africa 2023 - 04-06.12.23, Cape Town, South Africa
COP28 Networking Reception – Invest Africa - 05.12.23, Dubai, UAE
BackChat Season 2 Ep. 2: British High Commissioner Nicholas Woolley
What is the UK doing to support investment into the country? Is the UK involved in the renewable sector here? What will Zambia get out of the UK-African Investment Summit next year?
Find out through taking a listen to Choolwe Chibomba's conversation with Nicholas Woolley, British High Commissioner to Zambia.
Zambia Investor Briefing: October 2023
OVERVIEW
• On 26 October, in a huge milestone in the country’s debt restructuring process, Zambia announced it had reached an agreement in principle regarding the restructuring of $3 billion of its international bonds with key creditors. Finance Minister Situmbeko Musokotwane said in a statement the agreement “paves the way for similar restructuring agreements with our private creditors”. Earlier this month, the country had also agreed to a Memorandum of Understanding (MoU) with its official creditors – which includes China and members of the Paris Club – to restructure $6.3 billion of debt.
• Abu Dhabi’s International Holding Company (IHC) has signalled its interest in Mopani Copper Mines. Zambia’s state-owned investment vehicle Zambia Consolidated Copper Mines (ZCCM) took control of Mopani Copper Mines back in 2021, after global commodities powerhouse Glencore sold its stake for $1.5bn.
• The African Development Bank (AfDB) and Africa Finance Corporation (AFC) have recently joined the US and EU in support of the development of the Lobito Corridor, a trans-African railway line connecting Zambia and the DRC to regional and global markets through the port of Lobito on Angola’s west coast. A seven-side Memorandum of Understanding was signed regarding this on the margins of the Global Gateway Forum in Brussels.
• Barrick Gold has pledged an investment of nearly $2 billion in a bid to increase copper production at its Lumwana mine to a projected 240,000 tonnes. The company, which has previously announced plans to explore more copper deposits along the African Copperbelt, has announced it hopes to extend the life of the Lumwana mine to 2060. Barrick’s President and Chief Executive Mark Bristow said: “In Zambia as elsewhere in our global network, we seek to share the economic benefits generated by our mines with the countries’ governments and people”.
• Zambia has officially become the sixth country to receive SpaceX’s Starlink internet service, providing high-speed broadband and uncapped service to even remote regions of the country via satellite. President Hichilema had originally opened talks with Starlink in 2022. It is currently available in the country in specific areas, but the company plans to expand its coverage in the coming months.
• President Hichilema attended the Zambia-China Jiangxi Investment and Trade Cooperation Promotion Conference in Chibombo District. There, he also commissioned the Chibombo Jiangxi Economic Cooperation Zone. The conference follows a month on from the president’s state visit to the People’s Republic of China, where he signed several MoUs to further cement the trade and investment partnership between the two countries.
• President Hichilema, along with Mozambican President Felipe Nyusi and Malawi’s Lazarus Chakwera, have signed three agreements for the management of the Nacala Corridor in Mozambique. The agreements, aimed at strengthening the corridor’s operations strengthening the region’s development, were signed at the inauguration ceremony of the rehabilitated, expanded, and modernised infrastructures of Nacala Port. The rail corridor runs from the port of Nacala to the landlocked Malawi and Zambia, and will provide Zambian businesses with a shorter and more efficient trade route.
• President Hichilema hosted a delegation from K.E. International Consortium, an organisation that consults on large-scale renewable and sustainable projects and business development and is interested in creating Public-Private Partnership (PPP) projects with Zambia. The organisation’s areas of interest include infrastructure development, electric vehicle battery production, and renewable energy work to agriculture and agro-processing.
Zambia Reaches Deal for Debt Relief
On 26 October, Zambia announced it has reached an agreement in principle regarding the restructuring of $3 billion of its international bonds with key creditors – a huge milestone in the country’s debt restructure process. The deal is a set to provide $2.5 billion of cash-flow relief during the country’s $1.3 billion IMF programme which expires in 2025.
Finance Minister Situmbeko Musokotwane said in statement the agreement “paves the way for similar restructuring agreements with our private creditors”. The Zambia External Bondholder Steering Committee also welcomed the agreement, saying it would “restore full international capital markets access to Zambia and encourage long-term investment in the country”.
This announcement followed news earlier in the month that the country had agreed to a Memorandum of Understanding (MoU) with its bilateral creditors – including China and members of the Paris Club – to restructure $6.3 billion of debt. The agreements mean Zambia will pay about $910 million in the next decade, compared to almost $6 billion that was due to official creditors before the debt restructuring process.
UAE’s IHC Expresses Interest in Mopani Copper Mines
Abu Dhabi’s International Holding Company (IHC) has signalled its interest in Mopani Copper Mines. Zambia’s state-owned investment vehicle Zambia Consolidated Copper Mines (ZCCM) took control of Mopani Copper Mines back in 2021, after global commodities powerhouse Glencore sold its stake for $1.5 billion.
IHC has now emerged as the newest outfit looking to invest in Mopani. Its main competitor for the bid is South Africa’s Sibanye-Stillwater, since two Chinese corporations, Zijin Mining and Norinco, pulled out of the process.
Mopani is one of Zambia’s largest assets. President Hichilema has placed specific emphasis on copper production, setting an ambitious target of producing over three million tonnes of copper nationally by 2032. His recognition of copper’s significance has played a major part in the renewed interest of external investors in Zambia.
OTHER NEWS
Coal miner Exxaro hunts for copper assets in Congo, Zambia and Botswana 04.10.23, Reuters
Sibanye CEO says Zambia’s Mopani Copper Mines investment not ‘onerous’ 04.10.23, Reuters
Zambia plans to sell a green bond, regulate carbon credits 06.10.23, Bloomberg
South Africa: Minister Pandor undertakes working visit to Zambia 20.10.23, African Business
EU courts Africa in early push to counter Chinese spending 25.10.23, Bloomberg
As critical minerals gain importance, Standard bank eyes investment in DRC and Zambia 26.10.23, Arican Business
Anglo, Arc agree $90m Zambia exploration joint venture 27.10.23, Mining Weekly
UPCOMING EVENTS
Zambia International Mining + Energy Conference 01-2.11.23, Kitwe, Zambia
Africa Fintech Summit - 02-03.11.23, Lusaka, Zambia
Intra-African Trade Fair - 09-15.11.23, Cairo, Egypt
Africa Tech Festival - 13-16.11.23, Cape Town, SA
Zambia Investor Briefing: September 2023
OVERVIEW
Vedanta will take back ownership of Konkola Copper Mines (KCM), four years after the group was removed from its operations in Zambia by Edgar Lungu’s government. It was announced earlier this month that Vedanta, owned by Anil Agarwal, will invest $1 billion over the next five years to revive KCM. It will also fund $250 million of payments to local creditors of the mine to restore its majority stake.
Albert Halwampa, Director General of the ZDA, has announced pledges by Chinese firms to invest in Zambia to the total of $1.4 billion. This came during President Hakainde Hichilema’s six-day visit to the People’s Republic of China, undertaken to enhance the economic diplomacy between the two countries. There, he addressed the country’s potential investors at the Zambia-China Investment and Tourism Promotion Conference in Jinggangshan, Jiangxi Province. Hichilema’s itinerary also included visits to local authorities, various heads of industry, and investors.
At the G20 Forum in India, the US and the EU pledged their support of the Lobito Corridor Project, a trans-African railway line connecting Zambia and the DRC to regional and global markets through the port of Lobito on Angola’s west coast. As a first step, they will launch feasibility studies for a greenfield rail-line expansion between Zambia and Angola. The US and EU have also promised to upgrade critical infrastructure across sub-Saharan Africa in order to “unlock the enormous potential of this region”. Once completed, the Corridor would offer the shortest route to transport exports such as critical minerals from inland to the coast, and will also greatly benefit the region’s import economy.
Silicon Valley start-up KoBold Metals has said it aims to start producing copper and cobalt in Zambia within 10 years. The company is investing $150 million in its development of a copper deposit at Mingomba in Copperbelt Province. Mfikeyi Makayi, KoBold’s Zambian CEO, said, “It’s a very attractive project and we have said within a decade we would want Mingomba to be a producing mine”. KoBold uses AI to facilitate its search for critical minerals including copper, cobalt, nickel, and lithium.
Zambia has signed a Memorandum of Understanding (MoU) with two Chinese companies – the Development Company of China and the Guangxi Fenglin Wood Industry Group – to launch a 4 million hectare carbon offset venture in the country. Across 5% of all land in Zambia, trees will be planted and forests preserved. This venture will produce 23.25 million carbon credits a year, and the scheme is set to employ of 65,000 people.
In a lecture at the University of Zambia, the International Monetary Fund (IMF)’s Resident Representation Preya Sharma said Zambia’s economic growth had rebounded with inflation at a declined growth rate of 5% compared to 2019’s 1.5%, a great improvement of the country’s medium-term growth prospects.
Vedanta to Resume Production at KCM
Vedanta will take back ownership of Konkola Copper Mines (KCM), four years after the group was removed from its operations in Zambia by Edgar Lungu’s government. It was announced earlier this month that Vedanta, owned by Anil Agarwal, will invest $1 billion over the next five years to revive KCM. It will also fund $250 million of payments to local creditors of the mine to restore its majority stake, as well as a one-time payment of K2,500 to each mineworker.
Vedanta left the mine in 2019 when Lungu, in pursuit of nationalised mining across Zambia, seized control of it. The PF then used its 20% stake to place KCM in provisional liquidation. Since 2021, however, Hichilema’s government has been making efforts to reanimate the copper sector. This deal struck with Vedanta to restore KCM’s mining operations is one of the many new government initiatives to drive growth in the mining sector.
Anil Agarwal, Vedanta’s owner, said that the goal of the mining company would be to “become a fully integrated producer of copper and cater to India’s fast-growing demand while also making Zambia the leading producer of copper in the world”. Vedanta has pledged to double annual production to 100,000 tonnes, with the goal of reaching 200,000 tonnes as quickly as possible.
Chinese Firms to Invest $1.4 Billion in Zambia
Albert Halwampa, Director General of the ZDA, has announced pledges by Chinese firms to invest in Zambia to the total of $1.4 billion. This came during President Hakainde Hichilema’s six-day visit to the People’s Republic of China, undertaken to enhance economic diplomacy between the two countries. There, he addressed the country’s potential investors at the Zambia-China Investment and Tourism Promotion Conference in Jinggangshan, Jiangxi Province.
Hichilema’s itinerary also included visits to local authorities, various heads of industry, and investors. Upon his return, Hichilema announced the economic relationship between the two countries had been upgraded to a Comprehensive Strategic and Cooperative Partnership, with special focus on the areas of mining, agriculture, clean energy, and infrastructure.
The investments by Chinese firms in Zambia include: $800 million by Pingxiang Huaxu Technology for a wind and solar power project; $450 million for a photovoltaic solar project in Lusaka; and $290 million in lithium battery manufacturing by Jiangxi Special Motor Company.
Diplomatic highlights of Hichilema’s visit included meetings with President Xi Jinping and Zhao Leji, Chairperson of the Standing Committee of the National People’s Congress. The Zambian president also met with China’s Prime Minister Li Qiang, and expressed his “deep appreciation” for Li’s leadership during Zambia’s complex debt restructuring negotiations.
OTHER NEWS
Zambia’s copper FDI deal positive for growth and external liquidity 12.09.23, Fitch Ratings
Hope for Zambia’s path to sustainable development 15.09.23, United Nations
China, Zambia to encourage greater use of local currency in trade, Chinese state media report 15.09.23, Reuters
Liquid Intelligent Technologies Zambia launches Azure Stack, heling businesses access cloud solutions that meet local compliance requirements 21.09.23, African Business
China and Zambia: A new chapter beyond debt? 22.09.23, The Diplomat
United States supports construction of Mukungule Community Resource Board Office 22.09.23, African Business
Europe lines up African minerals pact to ease reliance on China 27.09.23, Bloomberg
UPCOMING EVENTS
AFSiC: Investing in Africa - 09-10.10.23, London ,UK
FT Africa Summit - 12.10.23, London, UK
UK-DRC Energy Transition Investment Forum - 16.10.23, London, UK
US-Africa Trade and Investment Global Summit 2023 - 18-21.10.23, Atlanta, Georgia
BackChat Season 2 Ep.1: Swedish Ambassador Johan Hallenborg
Tune in as Choolwe Chibomba speaks with Johan Hallenborg, Swedish Ambassador to Zambia, as they speak about sustainable mining in the country as well as the positive impact the debt restructuring deal has had on investment into the country.
Mopani Copper Mines in Zambia Attract Major Interest from UAE’s IHC
Zambia’s state-owned investment vehicle ZCCM took control of Mopani Copper Mines back in 2021, after global commodities powerhouse Glencore sold its stake for $1.5bn. Since then, ZCCM have been searching for new investors and received a lot of interest.
Mopani Copper Mines is a prized national asset in Zambia, managing one of Africa’s largest copper deposits. Despite unprecedented difficulties in the past year and mismanagement by the previous government under Edgar Lungu, the mine remais an appealing asset for global investors.
This is especially the case in view of current President Hakainde Hichilema’s major efforts to revamp the Zambian economy towards prosperity, for which mining plays a major role.
Mopani Copper Mines Facility.
President Hichilema has placed specific emphasis on copper production, setting an ambitious target of producing over three million tonnes of copper nationally by 2032. His recognition of copper’s significance has played a major part in the renewed interest of external investors in Zambia, putting the country emphatically back on the map.
Copper is a crucial component in everything from power lines, to electric cars and renewable energy infrastructure. It is an essential component for lithium-ion batteries, demand for which is soaring thanks to the electric vehicle boom. Mopani is therefore a pivotal asset for technological development both globally and within Zambia.
Abu Dhabi’s International Holding Company has now emerged as the newest outfit looking to invest in Mopani, according to reports by the Financial Times. The IHC is the UAE’s largest listed company. Its bid rivals the efforts of Sibanye-Stillwater, the multi-national mining company based in South Africa.
IHC’s head office in Abu Dhabi.
Since two Chinese corporations, Zijin Mining and Norinco (a defence company), which both initially contended for the mine, recently dropped out, Sibanye-Stillwater had been the main contender. Zijin withdrew because of delays on the Zambian side of the process, while Norinco had sanctions imposed on it by the US government.
The fresh interest from IHC signals the growing influence of Middle Eastern wealth in the global mining industry as well as the increasingly diversified investment in the Zambian economy.