Zambia and Zimbabwe are looking to maximise the potential of their mineral riches. Paulman Chungu and Nobert Musa Phiri talked to Craig Sisterson about the numerous opportunities in the neighbouring nations.
With their diverse range of mineral resources – including elements critical to clean energy – and several investor-welcoming changes to policies and regulatory frameworks, Zambia and Zimbabwe have a lot to offer in the global mining landscape, say Paulman Chungu and Nobert Musa Phiri.
“Zimbabwe has got what I’d call a permanent seat in the global mineral sector,” commented Phiri, a partner at Muvingi & Mugadza Legal Practitioners in Harare. “We’re an active player in the gold market, diamonds, the platinum group of metals, lithium for batteries, chrome, natural gas, and more. In the last couple of years Zimbabwe has tried to refocus attention on maximising this potential and restructuring policies and regulatory frameworks to improve the investment and productivity within the mining sector.”
Zimbabwean mining grew from US$2.7 billion in earnings in 2017 to US$5.6 billion in 2022. A Mines and Minerals Amendment Bill introduced last year seeks to change the landscape in a progressive manner, said Phiri. “We’re trying to move towards a framework that is more investor-friendly.”
Similarly, in neighbouring Zambia, a business-friendly government is looking to enhance mining policies to attract investment and boost the sector in a country that has been “resource rich since time immemorial”, says Chungu, Co-Managing Partner at Ranchhod Chungu Advocates in Lusaka. Reforms have been made in relation to small-scale and artisanal mining, local participation, mining royalties, and taxation on revenues and profits.
In May 2022, Canadian mining giant First Quantum Minerals announced that, following the New Dawn government’s initiatives to enhance investment and “establish a platform for more stable, durable, and responsible mining”, it was investing more than $1.3 billion in the country. This includes a low-cost high-grade nickel ore project powered by renewable energy that will make Zambia the continent’s largest producer of a mineral critical to the growing global market for electric vehicle batteries and green energy transition.
Chungu explained that in Zambia there have also been growing moves to ensure critical battery minerals are no longer just exported in raw form, and instead are processed or turned into value-added products locally. “In April 2022, Zambia and the DRC signed a cooperation agreement to manufacture these electric batteries,” he said. “There’s been a lot of political will and policy commitment towards manufacturing these batteries and the mining of nickel ore, which is a component in that process.”
Ongoing reforms and evolving regulatory frameworks can create risks for businesses like mining which operate over decades-long timeframes, note Chungu and Phiri. This is where top local counsel backed by broader support becomes so beneficial. Both of their practices are part of Alliott Global Alliance (AGA), which has 220 member firms across 95 countries.
Recently shortlisted in the Africa Legal Awards for Network/Alliance of the Year and ranked as a Band 1 Law Firm Network by Chambers and Partners, AGA is now one of the largest professional services alliances in Africa, with coverage in Algeria, Botswana, Cameroon, Egypt, Kenya, Lesotho, Libya, Malawi, Mauritius, Morocco, Nigeria, South Africa, Tanzania, Tunisia, Uganda, Zambia, and Zimbabwe.
“As a Law firm in the Alliance, we believe firmly in local expertise and global reach,” emphasised Phiri. “You really need your local, client-orientated experts rapidly available for access at any given stage. I think that’s what investors are looking for, and that’s what we’re offering.”
Chungu says their firms not only have relevant expertise and know-how, but also historic context of where their mining industries have come from, and what the climate and changes have been. “We have an intimate understanding of the policy inclinations of successive governments and the challenges experienced over time relating to the benefits local communities and the citizens in general are expected to draw from the exploitation of these resources,” he explained.
Zimbabwe and Zambia are twins historically and politically, sharing many things including the iconic Victoria Falls, noted Phiri. Now they share a brighter future.
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