Tuesday, January 15, 2008

The Long-lasting fallout of Shock & Awe – Lumwana Mine.

Shock and Awe is a term recently invigorated by the Bush administration’s initial military strategy in Iraq. The term defines the show of great strength and the rapid dominance that will

"Impose this overwhelming level of Shock and Awe against an adversary on an immediate or sufficiently timely basis to paralyze its will to carry on . . . to seize control of the environment and paralyze or so overload an adversary's perceptions and understanding of events that the enemy would be incapable of resistance at the tactical and strategic levels."

The Lumwana mine project may not be a military maneuver, however its design and execution smacks of the shock and awe strategy.
After acquiring financing that the mine managing director Hurry Michael calls

the largest debt finance package in Africa, five international financial institutions from different countries which include South Africa, United Kingdom, Germany, Australia and Canada have agreed to lend us US$584 million for the development of the project," Post Zambia ( I think this is an overstatement, there are bigger debt package by the Chinese and others).

Equinox the foreign owners dominate the land and copper deposits in Lumwana by a hundred percent and have brought in the largest means to extract the copper.

Michael says Lumwana mine would be among the largest copper mines in the world as evidenced by the equipment that would be used at the mine.
This mine will have the largest mills and to run these mills we will need 18 mega watts of power to run each mill, three times power consumption of the of Solwezi.

In the face of this huge display of shock and awe by Equinox, Solwezi district commissioner Albert Chifita and the local people, indeed have much to be fearful of -

"The Kabwe scenario would not be repeated in Solwezi, as you may be aware that the closure of Kabwe mine in June, 1994 brought the economy of the town to its knees and everything in the area changed drastically." ALbert Chifita

The poor are at some risk of not participating in the economic opportunities of mining while bearing many of the costs as well as risks that result from the introduction of a mine in an undeveloped area such as Lumwana.

Chifita explains that government knows that minerals are wasting assets and cannot be relied upon forever adding that government was trying to diversify the economy by emphasizing on agriculture and tourism as a mode of diversification.

Mr. Chifita may be a noble pragmatist in hoping the local people should look into agriculture and tourism as the long term economic activity for the area; however the sheer scale of this mining activity in the area ensures that this remains as the current and future counterpoint of the local economy.
Agriculture, Tourism and other economic activity may thrive during the lifespan of the mine but will they withstand the absence of the multitudes that have been drawn to the area by this huge short term mining activity?

The region lies vulnerable to fallout of shock and awe - the choice of quick profit over sustainable progress.
The rapid construction, commencement of mining and associated population increase does not allow the local to plan or develop sufficient capacity to ensure long lasting benefits from this interaction. Instead the more immediate and transient demands of accommodation and consumables like food, shops etc have boomed.
Because of scale it is usually beyond the capacity of local businesses to meet the demand of high cost business needs like equipment and recurring business needs; hence supply of these needs is outsourced, giving the real business opportunities to outsiders.

Despite Mr. Michael’s pronouncements of good intent that measures will be in place to protect people and the environment from the negative effects and risks of large scale mining, the local people must always be mindful that the implementers of shock and awe have little attachment to local causes and always preclude themselves from legal liability of environmental disasters such as accidental river pollution.

Unless the Zambian government or the local administration take bold and decisive measures to regain dominance –

i) In regulating the framework of business activity between the mine and local economy and ensure local businesses are not marginalized.
ii) Regulate and enforce environmental safety standards now and post mining period.
iii) Local land administration - zoning and property taxes collection to ensure local population also access utilities water, energy.
iv) Support local capacity to develop agriculture, tourism and craft/art through grants and resource personnel.

The people of Lumwana may yet find themselves as the Broken Hill people without copper or a mainstay economy in forty years.