Sections:
Freedom of Information Act 2000, request no.
F2007/130
Date of release: 1 October 2007
Loan to Government of Zambia
Details of a 2001 grant made by DFID to the Government of Zambia.
Q1 When exactly was the grant was issued
A. A letter confirming the grant was sent to the Zambian Minister of Finance on 20 June 2000. It was issued in a number of tranches over the next two years, the final one of $3.75m being made in July 2002.
Q2. What was the intended purpose of the grant?
A. The intended purpose was to finance a loan from the Zambian Government to Zambia Consolidated Copper Mines (Smelterco) Ltd on commercial terms to mange the refurbishment of the Nkana smelter. (Smelterco was a subsidiary of ZCCM.) DFID’s goal was to promote economic growth and poverty reduction in Zambia through restructuring of the mining industry.
Q3. Was it specifically to help bring SO2 emissions down?
A. No, although it was noted when the grant was approved that investment in Smelterco would help improve its environmental impact, particularly in air pollution.
Q4. What was the grant spent on?
A. The grant was used to finance a loan by the Zambian Government to Smelterco.
Q5. Whether the impact of the grant has been monitored?
A. Pricewaterhouse Coopers were contracted to monitor propriety in the disbursement of funds as well as the achievements of Smelterco against the indicators provided in the agreed business plan, including reviewing performance against environmental management plans. Additionally, DFID commissioned a review by environmental advisers in 2004 to establish whether there were adequate environmental and social management systems at the Nkana Smelter. The report concluded that there were adequate environmental and social management systems in place.