* Zambia is Africa's No. 2 copper producer
* Power crisis, weak copper prices threaten output
* Glencore , other miners halting some production
* Govt steps up power imports to ease situation
By Chris Mfula
LUSAKA, Sept 8 (Reuters) - An electricity shortage and
weaker copper prices have put pressure on Zambia's mining
industry, threatening output, jobs and economic growth in
Africa's No. 2 producer of the metal.
The power problems and copper price slide have driven the
kwacha currency to record lows amid a selloff in
commodity-linked currencies as key consumer China's economy has
slowed, renewing pressure on Zambia to diversify its economy.
Glencore GLEN.L , Vedanta Resources Plc VED.L and China's
NFC Africa and CNMC Luanshya Copper Mine have said they will
shut down some operations due to the harsh business environment.
"This is serious, it could bring our economy to its knees,"
independent analyst Maambo Hamaundu said.
Zambia's power generation capacity stands at 2,200 megawatts
(MW), with most of the electricity produced from hydropower, but
supply is often erratic.
State power utility Zesco Ltd, which generates the bulk of
the electricity, said last week it would deepen power cuts after
water levels at its largest hydropower station dropped following
a drought.
President Edgar Lungu said on Friday that Zambia should
reduce its overall imports of goods to tackle the country's
trade imbalance, but it should import more power to address the
shortages.
The Zambian government on Tuesday started importing 148 MW
of power from a ship docked off the coast of Mozambique.
"CEC (Copperbelt Energy Corporation) has communicated to the
mines, the need for them to begin accessing imported power,"
Chama Nsabika-Kalima, spokesperson for CEC CECZ.LZ , the
largest supplier of power to Zambia's copper mines, said.
Zambia is the world's No. 8 copper producer. The closure of
mines and smelters is likely to hit its output, which was
projected to increase to 916,767 tonnes by 2018 from 741,916
tonnes in 2015, largely on account of increased output at the
Kansanshi mine owned by Canada's First Quantum Minerals FM.TO ,
according to government data.
The slide in global copper prices, to six-year lows last
month, has already prompted the government to slash its economic
growth forecast for this year to 5 percent, from an initial 7
percent, and the deepening power crisis and curbs to copper
production risk a further slowdown, analysts say.
Copper production accounts for 11 percent of Zambia's gross
domestic product.
Labour unions are worried about the impending job cuts,
while the government has asked mining companies to consult with
the ministry of labour before shutting down operations.
"We started importing electricity and they have the option
to buy that power and continue with the operations," the chief
government spokesman, Chishimba Kambwili, said.
The Zambia Chamber of Mines, an industry body, said it was
talking to the government over the problems facing the industry.
"We understand the severity of the situation. We want to
work with the government to find a long-term solution to this
problem," the chamber's chief executive, Maureen Dlamini, told
Reuters.
(Editing by James Macharia and Susan Fenton)