ECONOMY

ECONOMIC BOOM AHEAD, FORECASTS EXPERT

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LUSAKA, ZAMBIA – First Quantum Minerals’ US$1.35 billion expansion plans are the first steps in helping government achieve its target of 3 million tonnes of copper production, which could triple Zambia’s GDP by 2030 and add half a million new jobs, according to leading economist Professor Oliver Saasa. The total investment required to realise the Government’s 3 million tonnes target by 2030 is in the region of US$30-40 billion, estimates Prof. Saasa in a report expected to be published next week. “Should this be realised, this phenomenal mining sector expansion would result in the increase of Zambia’s GDP by US$40-50 billion; a doubling in direct employment in the mines, and the creation of additional employment in excess of 500,000,” says the report published by Premier Consult. “Such growth would also increase incomes by about US$9-12 billion,” it adds.

First Quantum, which is Zambia’s largest taxpayer, plans to invest US$1.25 billion in its long-awaited expansion of Kansanshi’s operations in Solwezi – known as the ‘S3’ project – and a final US$100 million to start its $250 million Enterprise nickel project in Kalumbila. The S3 project will extend the life of the mine until the 2040s and increase copper and gold production by around 25%. It will also add approximately 800 permanent jobs, and a further 1,800 during the construction phase. Crucially, it also safeguards the future of the 8,500 people already employed at Kansanshi. Meanwhile the Enterprise nickel mine, which is expected to be operational within 12 months, will employ approximately 700 full-time staff.

“The S3 Expansion Project at Kansanshi Mine is expected to significantly contribute towards the Zambian Government target of achieving 3 million metric tons production per annum by 2030,” says the report. Kansanshi currently produces about 200,000 tonnes of copper per annum. Without this significant fresh investment, production would have started to decline by 2024, an average of 4 percent per annum. With fresh investment, copper production at Kansanshi is estimated to increase by up to 135,000 tonnes a year by 2030.

The S3 Expansion Project would cumulatively add about 690,000 tonnes during the 2022-2030 period. In terms of contribution, the S3 Expansion Project is estimated to contribute an average of 14-26 percent a year to the mining sector output, continues the report. In 2021, the mining sector was the largest contributor to both GDP growth and foreign exchange generation. Similarly, the sector is the largest single contributor to tax revenues by industry and continues to account for the largest inflows of foreign direct investment (FDI). It also provides high-quality jobs and economic opportunities.