Contributions of Foreign Direct Investment of Mining Sector to Economic Development of Zambia. Study of Konkola Copper Mines

Abstract

The research was about an assessment on the extent of the contribution of foreign direct investments (FDIs) on the economic development of Zambia in general and Copperbelt in particular by the Konkola Copper Mines (KCM) in Chingola. The survey findings revealed a positive trend in the magnitude and growth rates of factors that underpin the economic benefits of foreign direct investment in the domestic economy, such as increased employment creation, technology transfer or transfer of skills through on-the-job training, education, Government revenue, export earnings, and other economic multiplier effects and contributions to Gross Domestic Product - GDP averaging K6.2 billion when other companies were included (ZDA report 2013). Thus, KCM showed a favourable pattern and positive impact of the host economy as well as some negative impact. The study took into consideration whether liberalisation of the Zambian economy and privatisation succeeded in attracting FDIs to Zambia or not. It also found out factors that had played a role in attracting FDIs, analysed the good and bad effects on the development of the country. The information was obtained as a result of literature review and from conducting interviews through the administration of questionnaires and personal interviews with 500 respondents The study also tried to establish the extent to which FDIs alleviated poverty in Zambia through the creation of jobs and infrastructure development especially to the impoverished villagers and the poor living in urban areas.