Strategic Outsourcing And The Degree To Which It May Support The Successful Growth Of The Zambian Copper Mining Industry

In 1991 the Government of the Republic of Zambia passed legislation providing for the privatisation of Zambia Consolidated Copper Mines Limited (ZCCM). The newly formed Mining Companies, established after nearly a decade of difficult and protracted negotiations on such matters as, cash at close; retained percentage interest by ZCCM; equity investment; future investment commitment and tax concessions, were faced with great internal challenges and a harsh external environment. There was a convergence of a number of negative forces that had and will continue to have an impact on the mining environment in Zambia. The most crucial of these being, the competitive pressures of the global economy, fluctuating copper price and the prevailing HIV/AIDS pandemic. In the short period after privatisation, the Industry has seen the collapse of Binani Industries (Luanshya Mine), the withdrawal of Anglo America Corporation from Konkola Copper Mines Plc and the disposal of Chambishi Cobalt and Acid Plants by Anglovaal Mining Ltd. The objective of this paper is to provide a theoretical and practically researched foundation, which may be used to assist Zambian Mining Companies in making informed decisions on the issue of Strategic Outsourcing and the degree to which this may support the successful and sustainable growth of the Zambian Copper Mining Industry. If judiciously implemented, Strategic Outsourcing has the potential to generate a practical business valuation and process to assist Mine Management in the achievement of their business goals and consequently the return on investment to their Shareholders.