As risk appetite seeps back into Africa’s second largest copper hotspot Zambia, mining continues to see renewed focus over the last few months supported by a strong global de-carbonization drive to save the planet this climate resilient actions. Zambia’s determination in retaining its displaced position as the continents largest copper producer is vivid in its stretch growth target of 3 million metric tons in the next 5-10 years, from the current 806,000 metric tons.
READ ALSO: Zambia Leaves South Africa Choking in Its Dust At the 2022 Mining Indaba
Zambia’s largest bank by asset size and profitability Zanaco Plc in the week actualized one of the sideline proposals of the Indaba by signing a Memorandum of Understanding (MOU) with the state mining investment vehicle ZCCM-IH Plc to provide financing and other forms of support to Small to Medium Sized Enterprises (SMEs) that play in the mining supply value addition chain.
Speaking during the signing ceremony bank board chairperson, Patrick Wanjelani said as a home grown financial institution, Zanaco believes in contributing to Zambia’s economic transformation, adding that “through this partnership, the bank will endeavor to provide financial support to qualifying SME’s through suitable banking products.”
This will be through a framework of cooperation and collaboration between the two entities, that goes beyond providing general corporate funding facilities availed by Zanaco, to identifying opportunities for increased local participation in the mining sector.
Newly appointed board chairperson of the mining investment vehicle ZCCM-IH Dolika Banda, said the cooperation will assist with identification of opportunities for increased local participation in the mining sector predominantly, and this does resonate with the states agenda of building a resilient and sustainable mining industry anchored on investments that deliver benefits to all Zambians.
Mining is Zambia’s traditional mainstay and it’s pulse highly correlates with general economic activity that the MOU will seek to harness opportunity. Zambia recently signed key landmark economic protocols with its neighbor the Democratic Republic of Congo (DRC) aligned to supporting the electric car battery manufacture leveraging off its inventory of green metals such as copper, cobalt, manganese and lithium as the two nations ready for the electric car and renewable energy era.
ZCCM-IH will also seek to increase its shareholder value through leveraging off record metal prices on the London Metal Exchange (LME), greater demand for green metals and above all wider investment portfolio supported by future expansions in existing and new mines on the horizon.
Mining is viewed by most analysts as low hanging fruit for Zambia to help revive an ailing economy marred by fiscal fragilities but whose fortunes are at cusp of a sustainable turnaround. The copper producer targets conclusion of a financing deal with the Washington based lender the International Monetary Fund by end of June 2022.
The Kwacha Arbitrageur
