The Daylight Plunder of Mopani Copper Mines: A Constitutional Breach?

By Amb. Emmanuel Mwamba

Introduction
Mopani Copper Mines, once a flagship of Zambia’s mining industry, has become a subject of heated debate and controversy. The mine’s recent sale to International Resources Holdings (IRH), a United Arab Emirates-based entity, has raised serious constitutional, legal, and financial concerns. At the core of the controversy is whether the transaction violated Article 210(2) of Zambia’s Constitution, which mandates parliamentary approval for the disposal of major state assets.

Key Issues in the Mopani Sale

• Constitutional Breach: The sale of Mopani Copper Mines bypassed the constitutionally required two-thirds parliamentary approval, a move many legal experts deem unconstitutional.
• Non-Bidding Buyer: IRH, the entity acquiring a 51% stake in Mopani, did not participate in the competitive bidding process.
• Financial Transparency: No cash payment was made for the shares. Instead, the buyer pledged a $1.1 billion investment, raising questions about the fairness and prudence of the deal.
• Undervalued Asset: Mopani, with a $4.5 billion investment in state-of-the-art infrastructure between 2014 and 2021, was sold under terms critics argue do not reflect its true value.

Timeline of Events
2020-2021: Glencore, Mopani’s former majority shareholder, announced plans to exit Zambia’s mining sector amid legal troubles. In 2021, Glencore sold its 90% stake in Mopani to ZCCM Investments Holdings (ZCCM-IH) for $1, with Zambia assuming a $1.5 billion debt.

2022-2023: Zambia sought a strategic equity partner for Mopani, hiring Rothschild & Co to oversee the process. Despite shortlisting several bidders, including China’s Zijin Mining and South Africa’s Sibanye Stillwater, the government surprised many by selecting IRH a non-bidder with questionable credentials.

February 2024: IRH’s subsidiary, Delta Mining Limited, was officially approved as the new partner, acquiring 51% of Mopani’s shares. The deal includes pledges of investment rather than direct cash payments, sparking outrage among stakeholders.

Legal and Governance Questions
Attorney General opinions have complicated the debate. In a controversial statement, the Attorney General claimed Mopani was not a state-owned entity, attempting to sidestep constitutional provisions. However, under Article 266 of Zambia’s Constitution and Section 7 of the Minister of Finance (Incorporation) Act, Mopani, as a ZCCM-IH subsidiary, qualifies as a state institution under government control.

Concerns Over IRH and Delta Mining
The choice of IRH as the buyer has been met with skepticism. Industry experts point to the lack of public information about IRH and its subsidiary Delta Mining, raising fears that they could be shell companies with undisclosed beneficial owners. Furthermore, IRH’s failure to provide upfront capital for the transaction undermines Zambia’s fiscal interests.

The sale of Mopani Copper Mines is more than a financial deal; it is a matter of national interest and constitutional integrity. The lack of transparency, legal ambiguities, and potential undervaluation of one of Zambia’s most vital assets demand a thorough investigation. The government owes Zambians a full explanation to address growing fears that this transaction represents a betrayal of public trust.

This issue is not just about Mopani it is about safeguarding Zambia’s resources and upholding the rule of law.