LUSAKA, February 19, 2025
Opposition party Citizens First (CF) has strongly condemned the government’s decision to suspend export duty on precious gemstones and metals, warning that the move will undermine Zambia’s economic interests.
In a statement issued by CF President Harry Kalaba, the party argued that the Ministry of Finance and National Planning misrepresented the decision as a boost for investment in mining when, in reality, it would primarily benefit traders rather than genuine investors.
“Precious stones and metals are high-value, low-volume commodities, making them easily tradable on international markets. By removing export duty, the government is creating an environment where traders—not long-term investors—stand to gain the most,” CF stated.
The party warned that Zambia risks becoming merely a supplier of raw materials without mechanisms to encourage value addition or reinvestment into the sector. This, CF argued, would discourage legitimate mineral exploration and hinder long-term mining investments that could contribute to the country’s economic growth.
Economic and Revenue Concerns
Citizens First highlighted three key purposes of export duties on precious gemstones and metals:
1. Regulating Trade – Preventing uncontrolled exportation of national wealth.
2. Generating Revenue – Ensuring the government collects funds for public services and infrastructure.
3. Safeguarding Sovereign Wealth – Particularly in the case of gold, which plays a critical role in financial stability.
The opposition party expressed concern that removing export duties would significantly reduce government revenue, which could otherwise be used to improve public welfare. Additionally, the move could weaken oversight, leading to increased illegal mining and smuggling, making it harder to track production volumes and exports.
CF’s Recommendations
To protect Zambia’s economic interests, Citizens First proposed the following measures:
• Retaining export duties on precious gemstones and metals to regulate trade and secure national revenue.
• Providing tax incentives specifically for exploration companies, as they undertake high-risk investments that contribute to the mining sector’s sustainability.
• Ensuring that producing mining companies continue paying taxes in line with Zambia’s laws, which recognize minerals as a national asset for all citizens.
• Implementing a balanced fiscal policy that promotes exploration investment while ensuring that established mining firms contribute fairly to the economy.
Kalaba criticized Finance Minister Dr. Situmbeko Musokotwane, stating that the policy would not promote sustainable investment but instead open Zambia’s mineral wealth to unregulated trade, revenue loss, and increased smuggling. He urged the government to reconsider the decision and establish a framework that ensures the country’s natural resources benefit Zambians first rather than foreign traders and speculators.