Blackout Seen Costing Zambian Economy More Than $50 MillionMatthew Hill
A power failure that plunged almost all of Zambia into darkness for hours on Monday could cost the economy of Africa’s second-biggest copper producer more than $50 million as mines take time to recover, an economist said.
“The mining sector is different from all other productive sectors -- once you get a hit like that there are some spillover effects,” Isaac Ngoma, president at the Economics Association of Zambia, said Wednesday by mobile phone from Lusaka, the capital.
Power to the mines was stabilized at about 3 p.m. Tuesday after cuts that affected eight out of Zambia’s 10 provinces beginning 7:31 p.m. the previous day. Operations are normalizing and the blackouts may cost the industry as many as four days of lost production, Jackson Sikamo, president at the Zambia Chamber of Mines, a body representing companies including First Quantum Minerals Ltd. and Vedanta Plc’s Konkola unit, said by mobile phone.
The country is already facing the prospect of borrowing more or cutting spending this year to cover what will be a larger-than-planned budget deficit as copper output and prices fall below government forecasts. Erratic rains will also reduce Zambia’s corn harvest this year, making it a “big challenge” to meet the government’s 7 percent economic growth target for 2015, Bank of Zambia Governor Denny Kalyalya said Tuesday.
A fault at Zambia’s Kariba North hydropower plant on Monday cut power to most of the country and large parts of Zimbabwe.