Zambia News

Royalty Transaction Will Bring In More Profits

According to Finance Minister SITUMBEKO MUSOKOTWANE, the 20 percent stake ZCCM-IH holds in the Kansanshi Copper Mine was converted to a 3.1 percent royalty by the government because it provides a more lucrative revenue stream than the dividend model.

According to Dr. MUSOKOTWANE, this means that ZCCM-IH will receive money at a rate of 3.1 percent for everything that is mined from the Kansanshi Copper Mine, regardless of whether the mine is profitable.

At a press conference in Lusaka, he informed the media that talks to change the dividends to a royalty had really been ongoing for three years prior to the New Dawn Administration taking office.

According to Dr. MUSOKOTWANE, under the dividend model, ZCCM-IH would not keep any of the 20% of the Kansanshi Copper Mine that it holds since the other owners, who hold 80% of the mine’s shares, would simply outvote ZCCM-IH on dividend decisions.


He said that ZCCM-IH got 337 million dollars in dividends between 2009 and 2021.

Dr. MUSOKOTWANE pointed out that ZCCM-IH would have made roughly 671 million dollars if the royalty model had been in existence during 2016 and 2017 when dividends were not announced.

According to him, the royalty model is a more reliable, constant, and predictable source of income for ZCCM-IH than the dividend model.

The government intends to restructure the mining industry to get it back into production and out of court, according to Mines Minister PAUL KABUSWE.

According to Mr. KABUSWE, the mining industry was in a state of disarray during the previous administration as a result of numerous issues involving it on various levels.

Additionally, ZCCM-IH seeks to maximize the revenue retains on its investments in different mines so that it can engage in mineral exploration, according to ZCCM-IH Board Chair DORIKA BANDA.

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