Political interference at ZCCM-IH :

Responses to economist Lubinda Haabazoka

1. Background

In our press release of 18 February 2025 (Appendix 1), we informed the Zambian people and ZCCM-IH stakeholders that serious interference was taking place within ZCCM-IH. This interference is clearly contrary to the country’s interests and is being orchestrated by IDC CEO Cornwell Muleya and Secretary to the Cabinet Patrick Kangwa. On 16 March 2025, we spoke of President Hichilema’s strong commitments to end political interference in the parastatals, but his fine promises have never been kept. (Appendix 2)

On 18 March 2024, economist Lubinda Hahaabazoka wrote the press release « Unfair Attack by

Thierry CHARLES, The So-Called President of ZCCM Defense ». (Appendix 3)

We therefore wish to respond to the inconsistencies, untruths, inaccuracies and blatant misunderstandings of this economist, and thus provide the Zambian people and ZCCM-IH stakeholders with information that will enable everyone to have an informed understanding of the situation.

2. ZCCM Defense

Lubinda Haabazoka discredits our defense association. Its founding General Assembly took place on 18 October 2024 in France under number W514004247, and I was elected President. For several decades, minority shareholders of the Zambian companies ZCCM and then ZCCM – Investments Holdings have held informal consultations to defend their interests as minority shareholders of the company. The creation of the ZCCM Defense association is intended to officially formalize the defense of ZCCM-IH minority shareholders and, beyond that, the protection of the interests of local populations throughout the world, particularly in Zambia, against the actions of negligent, incompetent or corrupt managers, Directors or governments, or those of commercial or mining companies, or individuals not acting in the general interest. Minority shareholders through ZCCM Defense now have the legal tools to take legal action in any jurisdiction. (Appendix 4)

3. Political interference

Lubinda Haabazoka criticises our discontentment with political interference:

« the company is majority-owned by the Zambian government, which means that government influence is both logical and necessary », « I find it very surprising that Mr. Charles can be shocked that the government has influence over ZCCM-IH. This company is owned by the Zambian people through the government. It would be irresponsible for the government not to have a say in its operations. »

ZCCM-IH is listed on the Euronext, LuSE and LSE international markets. It is very surprising for an economist not to know that listed companies obey rules governed by Authority Bodies, that the rights and interests of minority shareholders must be preserved and that, consequently, political interference aimed at putting pressure on the Board and Management for purposes contrary to the interests of the company are formally prohibited. In addition, the latest SOEs policy reaffirms these basic principles.

His press release is surreal, and totally contradicts what Lubinda Haabazoka said less than two years ago in a joint interview with CTPD Researcher Elijah Mumba (Appendix 5) : the ZCCM-IH board independence was important as international investors needed to protect their investments and ZCCM-IH Board lacks autonomy. He emphasised on the need for ZCCMIH to be autonomy in its operations.

« The ZCCM-IH board needs to be totally autonomous, free from political interference while practicing high level of transparency in its operations to avoid driving away investors who may feel their investments are not safe in the mining sector » CTPD Elijah Mumba has added.

We leave it to the Zambian people to judge Lubinda Haabazoka’s credibility in the face of such inconsistencies…

4. Mopani

Lubinda Haabazoka also wrote « When Mopani shares were given to ZCCM-IH, how much did the minority shareholders contribute? I missed that part and should be briefed ».

Clearly, Lubinda Haabazoka has no knowledge of the ZCCM-IH case and is taking the liberty of casting unjustified aspersions on the minority shareholders… What is he talking about? He seems to have no idea what a company’s shareholding structure is… When ZCCM was transformed into ZCCM-IH in 2000, ZCCM-IH kept 10% of the shares in Mopani and 90% were acquired by Carlisa Investments (owned by Glencore and First Quantum). None of the

shareholders of the former ZCCM contributed anything, including minority shareholders and the Zambian state, since the successful bidder’s proposal gave a 10 % interest of 5 % free carry and the other 5 % repayable from future dividends (Appendix 6) … Then, ZCCM-IH shares were sold to investors by the GRZ, a sale known as stage I of privatization. The price for each share naturally included the 10% of Mopani shares.

ZCCM-IH alone took on $1.5 billion in debt to acquire 90% of Mopani in 2021 at a staggering price on pressure of GRZ. Why did Dr Haabazoka not say anything about this overpaid, strangely badly negotiated amount, where former vice-presidente Inonge Wina even said that it was the deal of the year, when our company was on the verge of ruin because of the exorbitant interest charged by Glencore?

5. Silence or strange complacency

Lubinda Haabazoka presents himself as a great connoisseur of ZCCM-IH and the mining sector, and is supposedly promoting a return to the glory days of the past.

5.1 provisional liquidation of KCM

In May 2019, Lubinda Haabazoka met former President Edgar Lungu at State House and endorsed the action to place Konkola Copper Mines (KCM) on provisional liquidation.(Appendix 7) Given the situation over the last six years, it is clear that he had no vision on this issue. It was obviously imperative to get rid of Vedanta, but we talked about another way of doing it. Why did Lubinda Haabazoka endorse the PF-initiated liquidation of KCM when there was a shareholders’ agreement protecting Vedanta, and why did he not support our group’s proposal that the liquidation procedure should instead be initiated by a defrauded subcontractor to avoid involving the GRZ and ZCCM-IH in arbitration?

5.2 Ndola Lime

Why did he not hold IDC CEO Cornwell Muleya to account when ZCCM Defense recently condemned his culpable inaction regarding the $120 million that went up in smoke in a very suspicious manner? Why did Lubinda Haabazoka not relay the Committee on Parastatal Bodies’ unheeded recommendation to prosecute the crooks?

5.3 Silence on hidden documents

Lubinda Haabazoka and Elijah Mumba have called for a high level of transparency in the operations of ZCCM-IH. Why did the economist not react when Mines Minister Paul Kabuswe refused to answer parliamentarians’ questions about the details of the deal with IRH concerning Mopani?

Why did Lubinda Haabazoka not question the GRZ when it refused to give the minority shareholders the documents they had requested on the astronomical purchase of the 90% stake in Mopani? Or the documents concerning the Royalties of KMP deal with First Quantum Minerals?

On this subject, perhaps Lubinda Haabazoka will finally turn words into tangible actions, get a grip and quickly and delve into First Quantum’s 2024 accounts and then inform the Zambian people that paltry 3.1% KMP royalty is peanuts compared to the 20% of KMP’s colossal revenues that ZCCM-IH could have obtained without this deceptive deal…

6. Accusation of bootlicking

One wonders why the economist Lubinda Haabazoka is silent on such damaging facts for ZCCM-IH when he claims to want ZCCM-IH to be revived?

His propensity to cajole and caress the governments in place that be is apparently not something new. He was the former President of the Economics Association of Zambia (EAZ). During his presidency , « the EAZ was so pro government it led to one of Zambia’s biggest donors the United Kingdom questioning the professionnalism of the Association » and he was accused of « bootlicking » former President Edgar Lungu. (Appendix 8)

7. Zambian Army

Lubinda Haabazoka said « Zambia only has three defenders: The Zambia Army, The Zambia Air Force, and The Zambia National Service ».

As far as ZCCM-IH is concerned, we totally disagree. For more than a year, The Zambia National Service has illegally seized and operates ZCCM-IH’s Mushe Milling mill without any authorisation. Where does the mealie meal go? What happens there? Are high ranking military officers involved in speculation of mealie meal to line their own pockets? Is this defending Zambians?

At the time of the closure of the Kasenseli gold mine, the Zambia National Service and Zambia Army were responsible for guarding the mine. Yet the fences and equipment were ransacked. Worse still, the Zambian army was even accused of mining the gold during the long years of closure. In response to the uproar and accusations, three ZNS officers were fired for illegal gold mining (Appendix 9). Is this defending Zambia?

On the social Networks, Dr Haabazoka said « Maybe one day, I will be commander in chief of all armed forces in Zambia. » (Appendix 10)

If, one day, his prophecy comes true, we strongly encourage him to urge the Zambian military to really defend Zambia and to stop making them play millers or Jerabos to the detriment of ZCCM-IH and therefore Zambian interests…

8. Conclusion

It is distressing that investors in Zambia should be castigated in this way for exposing wrongdoing at ZCCM-IH and for wanting the company to be run according to high standards of governance and without malfeasance.

This attack is all the more illegitimate as it comes from someone who claims that « if I had money, I would rather invest it in China than keep it in the country» (Appendix 11).

And this person has the impudence to go on to give lessons in patriotic morality and to denigrate investors who put their money into Zambia and want their investments safeguarded ! Lubinda Haabazoka is perfectly right when he states that « The board members at ZCCM-IH represent us, and their voting should be based on what we, the Zambians, want. That interest is vested in the Zambian government, who are our representatives. Every five years, we go to the polls to appraise the performance of these representatives. » But the Zambian people should not be misled by politicians and pseudo-experts and should be able to make an informed choice !

Meanwhile, for our all ill-intentioned detractors, ZCCM Defense will continue to inform Zambians of what is happening in their flagship ZCCM-IH as well as in the mining sector so that they are fully informed. ZCCM Defense will continue to defend the Company’s interests despite the bad eggs.

Issued by :

Thierry CHARLES

President of ZCCM Defense 27 March 2025, FRANCE [email protected]

APPENDIX 1 :

https://www.facebook.com/photo.php?fbid=1192829266185190&id=100063743840552&set=a.454485550019569

APPENDIX 2 :