VZCZCXRO1442
RR RUEHBZ RUEHDU RUEHJO RUEHMR RUEHRN
DE RUEHLS #1627/01 3331435
ZNR UUUUU ZZH
R 291435Z NOV 06
FM AMEMBASSY LUSAKA
TO RUEHC/SECSTATE WASHDC 3584
RUCPDOC/DEPT OF COMMERCE WASHDC
INFO RUCNSAD/SOUTHERN AFRICAN DEVELOPMENT COMMUNITY

UNCLAS SECTION 01 OF 02 LUSAKA 001627 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: ECON EINV EAIR PGOV ZA
SUBJECT: ZAMBIA NOVEMBER ECONOMIC NEWS ROUNDUP 
 
 
¶1. SUMMARY OF TOPICS 
 
-- China forgives Zambian debt, signs smelter deal 
-- Konkola Copper Mine spill pollutes Kafue River 
-- Two-thirds of Zambians lack access to financial services 
-- Time to register a company with PACRO down to one day 
-- Chilanga Cement launches construction of new plant 
 
¶2. China forgives Zambian debt, signs smelter deal 
 
President Mwanawasa announced on November 7 during a visit to 
Beijing for the Sino-African Summit that the Chinese government had 
written off USD 211 million of debt owed by the Zambian government, 
including debt that Zambia incurred in the 1970s to build the TAZARA 
railway line. 
 
On the margins of the Sino-African Summit in early November, Zambia 
and China signed a memorandum of understanding for the construction 
of a copper smelter by Chambishi Non-Ferrous Company, with a 
reported investment of USD 200 million. 
 
Source: Zambia Daily Mail, November 9, 2006 
 
¶3. Konkola Copper Mine spill pollutes Kafue River 
 
Zambia's largest copper mine, Konkola Copper Mine, owned by 
UK-Indian company Vedanta Plc, spilled highly acidic pollutants into 
the Kafue River in Chingola in North-Western Province after a pipe 
at a leaching plant burst on November 6. 
 
Residents who used the polluted water suffered from diarrhea, rashes 
and other ailments.  Local water companies turned off water as soon 
as the contaminants were detected, causing further hardship to the 
affected area for several days.  Mines and Mineral Development 
Minister Kalombo Mwansa visited the affected area on November 9 and 
said he was impressed by how KCM had mobilized equipment at short 
notice and made progress in dredging silt material.  Minister of 
Tourism, Environment and Natural Resources Kabinga Pande issued a 
statement on November 14 that blamed KCM's negligence in failing to 
replace old pipes as the cause of the spill.  He said that an 
Environmental Council of Zambia inspection of KCM in mid-2006 turned 
up problems and KCM was given a deadline of December 31, 2006 by 
which to come into full compliance with environmental requirements. 
KCM was allowed to resume copper processing operations on November 
17 after the ECZ determined it had put sufficient clean-up measures 
into place. 
 
Source: Times of Zambia, November 8-18, 2006 
http://www.zambia.co.zm 
 
4) Two-thirds of Zambians lack access to financial services 
 
According to a nationwide survey conducted by FinScope Zambia and 
funded by UK and Swedish development agencies, two-thirds of 
Zambians do not have access to formal or informal financial 
services, only 14.6 percent of Zambians have a bank account, and 
only 7.5 of the adult population use automated teller machine (ATM) 
cards.  The reasons cited for lack of access included the physical 
distance to banks and high minimum balance requirements for 
establishing accounts.  Over half of the 4,000 people surveyed said 
that they would like access to banking services. 
 
Source: The Post, November 9, 2006 
 
¶5. Time to register a company with PACRO down to one day 
 
Thanks to technical and material support from the Millennium 
Challenge Account Threshold Program, the Patents and Companies 
Registration Office (PACRO) has installed an automated system that 
reduces the time required to register a company from nine to 
fourteen days to just one day.  According to the registrar of PACRO, 
the new automated system will also reduce costs of registering a 
business and enhance transparency in the way PACRO operates.  PACRO 
also plans to decentralize the company registration process, by 
introducing automated registration systems in Ndola, Copperbelt 
Province; Livingstone, Southern Province; and Chipata, Eastern 
Province, by March 2007.  PACRO registrar Anessie Banda-Bobo, Acting 
Secretary of Commerce, Trade and Industry Felix Mutati, and 
 
SIPDIS 
Secretary to the Treasury Evans Chibiliti joined Ambassador Carmen 
 
SIPDIS 
Martinez and USAID Mission Director Jim Bednar in a ribbon-cutting 
ceremony on November 9 to inaugurate PACRO's new, fully-automated 
customer service center. 
 
Source: The Post, November 10, 2006; U.S. Embassy Lusaka website 
 
¶6. Chilanga Cement launches construction of new plant 
 
President Mwanawasa laid the foundation stone for a new USD 120 
million cement plant that is being built for Chilanga Cement, a 
subsidiary of French-owned LaFarge.  A Chinese company, CBMI, which 
works with LaFarge in China and France, received the contract to 
build the modern, environmentally-friendly plant to replace Chilanga 
 
LUSAKA 00001627  002 OF 002 
 
 
Cement's 1948-vintage plant.  Seven cabinet Ministers, other VIPs, 
and business representatives also attended the opening ceremony on 
November 22.  When completed in 2008, the "Tukule project" will 
produce 80,000 bags of cement (2,000 tons) per day, doubling 
Chilanga's current production capacity.  In his remarks at the 
event, the President urged Chilanga Cement to reduce the cost of 
cement, so that prices remained affordable for Zambian citizens, and 
to spur more construction.  He also challenged Chilanga's management 
to assist the compound community near the factory by building and 
improving housing. 
 
Source: Times of Zambia, November 23, 2006; Embassy Commercial FSN 
observations 
 
MARTINEZ