Word: kaunda
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Dates: during 1960-1969
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Last week Kaunda made it clear that Zambian ambitions have grown. Clad in his usual khaki bush suit, he told 400 cheering members of the ruling United National Independence Party that he was "asking" the owners of the mines to give 51% of their shares to the state. "I do not think," he said, "that the nation can achieve economic independence without acquiring full control of the existing mines...
Delayed Payment. Chiefly affected by Kaunda's "request" will be the Roan Selection Trust, Ltd., 43% of which is owned by Manhattan-based American Metal Climax, Inc., and Anglo American Corp. of South Africa Ltd. In addition to taking over controlling interests in the firms, Zambia will substitute 25-year leases for their existing leases "in perpetuity," and replace the present 44% royalty and export tax with a 51% mineral tax. The nationalized companies' holdings have a book value of about $784 million. Kaunda expects to pay shareholders for their loss entirely out of future copper profits. These...
Both political and economic pressures lie behind Kaunda's move. Zambia, the former British colony of Northern Rhodesia, remains uncomfortably dependent upon white-dominated Rhodesia for trade and electric power. The cost of living is soaring and abrasive tensions between Zambia's blacks and whites (who constitute 1.5% of the population), are on the rise. Recognizing the importance of the mines to his country, Kaunda met two years ago with Chile's President Eduardo Frei to discuss an arrangement to help maintain world copper prices and quotas. Although no price-fixing agreement resulted from their talks, Frei...
Risky Action. Kaunda's action entails serious risks for his country. Zambia has neither the capital nor the skills to run the mines by itself. Kaunda must rely heavily on both the companies and their remaining 5,000 white miners to keep operations going. Only the steadily rising price of copper, now at a high of 740 per pound, has enabled Zambia to maintain a favorable balance of payments in recent years. Any decline in copper prices as a result of an end of the war in Viet Nam, the discovery of new sources, or the increased...
Zambia's greatest damage will probably be to itself. The country needs private investment capital, and, as New York Governor Nelson Rockefeller said on his recent South American tour, "investment capital likes to go where it is loved." Kaunda's action can only encourage potential Zambian investors to go elsewhere in search of affection...