Government to control externalisation of profits by mines

Government to control externalisation of profits by mines

Miles Sampa

The PF government will soon issue a statutory instrument which will control the externalisation of export earnings, especially by mining companies.
Deputy Minister of Finance Miles Sampa (right) says Statutory Instrument (SI) number 34 will compel investors to acquire letters of credit from Government before exporting their products.
He said in Parliament on Thursday that through letters of credit, Government will be able to ascertain how much revenue investors will acquire from their export products and remit some funds to the national treasury, in respect of their total earnings.
Mr Sampa said the revenue realised from the exports will be banked locally before being given back to exporters to help grow the Zambian economy.
He said when winding up debate on the report of the parliamentary committee on economic affairs that the Patriotic Front (PF) government is aware that Zambians do not fully benefit from the country’s mineral wealth and it is putting in place measures to ensure that the country starts generating enough revenue from minerals.
Mr Sampa said SI 34 will ensure that all export transactions are approved through letters of credit to ensure that the money realised is banked locally.
He said Government is concerned that most investors in the mining industry bank their revenue outside the country and that it will soon give letters of credit to them once SI 34 comes into effect.
And Parliament adopted the report which was presented by committee chairperson Charles Kakoma, who is Zambezi West UPND member of Parliament.
The report, among other things, recommended that Government should develop a comprehensive debt strategy and policy that should stipulate when to borrow, on what terms and for what purposes.
Mr Sampa, however, said Government is committed to dismantling all outstanding debts Zambia owes various institutions and that the MMD administration left an external debt of about 10.9 percent.
He said the MMD borrowed huge sums of money, especially in the run-up to last year’s general elections to finance various developmental projects in its quest to entice voters to choose them.
Mr Sampa told the House that the external debt currently stands at about 10.7 percent and that Government is working round-the-clock to offset it.
He said although MMD tried to improve the economy, economic gains never trickled down to the people and the PF Government will productively utilise such gains to improve living standards.

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