In July, a Silicon Valley start-up embarked on a $150 million exploration mission in search of a top-tier copper reserve. KoBold Metals, backed by venture capitalists such as Breakthrough Energy Ventures, aims to discover high-quality copper deposits that can contribute to Zambia’s economic revival. The company utilizes AI technology to guide drilling efforts with precision. Alex Matthews, KoBold’s Zambia country manager, emphasizes the rarity of such support and the significance of the mission.
Zambia, known for its copper exports, now faces the challenge of reviving the once-thriving Copperbelt region, which has fallen behind in terms of production. President Hakainde Hichilema, who took office in 2021, aims to triple the country’s copper production from 800,000 tonnes to over 3 million tonnes by 2032. This ambitious goal requires attracting investment for exploration and revitalizing old mines dealing with high power costs. Hichilema acknowledges the importance of every tonne in achieving this target.
Geography also plays a crucial role in Zambia’s copper industry. While the country shares a rich copper endowment with the Democratic Republic of Congo (DRC), its copper must be transported over long distances, predominantly by truck, to reach ports. Despite this logistical challenge, Zambia benefits from greater political stability compared to its neighbor, the DRC.
To overcome these obstacles, Hichilema’s government is pursuing various strategies. It supports the establishment of a regional railway connection to Angola’s Lobito port, which would significantly reduce transportation time from the Copperbelt. The government has also stabilized mining taxes and signed an agreement to create a cross-border economic zone with the DRC, strengthening the value chain for their copper, particularly in the production of electric vehicle batteries.
Before realizing these plans, Hichilema must address the consequences of his predecessor’s ill-fated state takeovers of Konkola and Mopani, the Copperbelt’s largest mines. These actions have led to significant losses and a decline in the region’s economic vitality. Efforts to attract new investments and improve working conditions are ongoing as the government aims to turn the Copperbelt’s fortunes around.
Zambia’s path to reclaiming its status as a major copper producer requires careful management and overcoming financial challenges. The country experienced a debt crisis in 2020 and the subsequent default on foreign debt payments, making it the first African country to do so. While Zambia has secured relief and is now on the path to debt restructuring, uncertainties remain. The government’s ability to meet repayment obligations and attract further debt relief hinges on its economic performance and cooperation with international partners.
Despite the hurdles, Zambia’s citizens have a sense of optimism and belief in their country’s mineral wealth. However, the challenges faced by workers in the mining industry, such as low wages and deteriorating working conditions, paint a more nuanced picture. Nevertheless, the potential for new investment and improvements in the industry provide hope for a brighter future in the Copperbelt region and Zambia as a whole.
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