By JAMES MUYANWA
FIRST Quantum Minerals (FQM) has climbed down on plans to lay off thousands of workers at its Kansanshi, Kalumbila and Sentinel mines by April this year.
The Canadian miner announced yesterday that it would instead remain in dialogue with the Government over the new mining taxes that it gave as reasons for the planned labour cuts.
This comes a day after it announced it had submitted proposals for a compromise on the new tax regime, with a warning that it would consider all options, including selling the mine.
FQM, Zambia’s biggest copper miner, has already laid off scores of expatriate labour employed at its bases in North-Western Province and its corporate office in Ndola.
It had earmarked to retrench 2,500 employees during the first quarter of this year because of changes in the tax regime contained in the 2019 National budget.
FQM now says in a statement issued yesterday that the company will not proceed with its plans to downsize its Zambian workforce involved in its production activities.
“Furthermore, First Quantum commits to strive to maintain its production where operational constraints allow,” partly reads the statement.
It reiterated its position that the tax measures introduced on January 1 this year posed a range of economic challenges to the mining sector.
The spokersperson says following detailed analysis and after having considered various factors resulting from the new taxes, the mining house has decided to “reduce only those elements of its workforce in Zambia associated with capital projects.”
“Notwithstanding this, First Quantum continues to engage closely over the new taxes with the Government of the Republic of Zambia, in order to find an enduring solution which is beneficial to both the Government and the Company,” the statement says.
First Quantum says it is fully committed to growing its operations in Zambia with the help of the Zambian Government.
On December 21 2018, FQM announced its plans to reduce its workforce at Kansanshi, Kalumbila and Sentinel mines.
The decision would have affected 1,250 direct employees at the company’s Kansanshi Mine in Solwezi and a further 1,250 at its Sentinel Mine in Kalumbila and both local and expatriate staff across all departments.
FQM’s grievances concern the government’s 2019 Budget mining tax measures, which include an additional 1.5 per cent increase on all mineral royalty tax bands, and an additional two royalty bands of 8.5 and 10 per cent when copper prices exceed US$7,500 and $9,000 per tonne respectively.
Other government measures FMQ had complained about were the introduction of a yet-to-be-quantified sales tax to replace Value Added Tax.