Who is to blame? The player or the rules of the game?

Abstract: Why the performance of local value-adding firms supplying to mining MNCs in Zambia’s liberalized economy seems more constrained was the investigated problem. I conducted a multiple case study research involving 15 firms located on Copperbelt Province. Local value-adding firms are cardinal to national industrial development through their backward linkage role to mines. However, their performance is more constrained partly because of their weak internal capabilities. The real constraint for their situation lies in the “rules of the game” of supplying to mining MNCs which are externally engineered and applied by mining companies. Mining MNCs have absolute power to determine who supplies, what is supplied, what price and extent to which supplies are made whilst government acts like a spectator unlike a referee. Government’s inactivity emanates from institutional changes birthed by the 1991 economic liberalization. Addressing the firms’ situation neither lies in “doing business as usual” where mining MNCs remain more powerful nor in government fully regulating the relationship between local suppliers and mining companies. What could work is a holistic “change of the rules of the game” through government’s actively engaging stakeholders and appropriately incentivizing each category to subsequently strengthen the procurement and supplying relationship between mines and local suppliers.