Zambia’s Chibuluma Mines Plc plans to sack more than half of its employees and cut output by 40 percent as low copper prices threatens its continued existence.
A statement by the Metorex Group of Companies of South Africa-owned company said it was in a loss-making situation and if nothing was done to address the situation, it may be forced to shut down permanently.
Weaker copper prices and electricity shortage has pressured Zambia’s mining industry, its economy and currency. Prices of the metal have fallen by 20 percent since May amid slowing growth in China, a major importer of the metal.
Chibuluma will, therefore, lay off 263 of 514 its employees in the first quarter of 2016 and cut monthly output at its Chibuluma South mine to approximately 27,000 tonnes of copper ore from 45,000.
“The company has made arrangements for a significant proportion of the employees affected to be taken on by the contractors who will carry out the outsourced services,” the company said.