The mining industry – and the production of copper and cobalt, in particular – is of vital importance to the economy of the Democratic Republic of Congo (DRC). However, political, social and legislative stability is critical to ensuring the growth and sustainability of the sector, says DRC senator Florentin Mokonda Bonza.
Bonza, a member of opposition party the Convention of Christian Democrats, tells Mining Weekly that mining directly and indirectly contributes about 30% of gross domestic product (GDP), with the country producing over one-million tons of copper in 2016, ensuring it remains the largest copper producing nation in Africa, as well as being the largest producer of cobalt, producing about 64 000 t in 2016.
According to the DRC Chamber of Mines’ 2016 mining industry report, the country also produced about 22 600 kg of gold, 14.7-million carats of diamonds, 11 600 t of zinc, 9 400 t of cassiterite, 869 t of coltan and 112 t of wolframite in 2016. The country also possesses large deposits of tin, niobium, manganese, platinum, iron-ore and nickel, as well as oil and gas.
Bonza contends that, while copper production has risen threefold in the DRC since the 1980s, the mining sector as a whole has not contributed revenues to the State to the same degree as it did in the 1980s.
“This is because our Mining Code, which was published in 2002, does not offer enough opportunities for the generation of State revenues. “For example, it does not oblige producers to swiftly repatriate foreign currencies into the country,” he states.
He asserts that these “legislative deficiencies” are impeding the country’s ability to fully capitalise on its rich mineral resources.
Between 2008 and 2016, Bonza was part of a senate commission that was established to conduct research on the status of the mining sector in the DRC. Some of the findings were that government only took a 5% free-carry share in mining companies; mining companies were found to have “excessive” influence over land control and management issues and, therefore, subordinated all other landowners that may have conflicting land rights; and the implementation of the Mining Code had resulted in a mushrooming of mines throughout the country at the expense of other land-dependent industries, such as agriculture, housing and manufacturing. The commission also found that mining royalties and taxes were not favourable to the government of the DRC. Bonza comments that, therefore, there is a need to alter the Mining Code to address these issues.
He believes that there needs to be greater emphasis, through legislation and incentive schemes, on mines processing the resources they produce locally and not just shipping out raw product.
“Value addition through the processing of materials in the DRC will create new industries and provide thousands of new job opportunities for people, which is critical in addressing the issue of unemployment in the country.”
The senator remarks that there is “an urgent need” for the DRC to diversify its economy away from its overreliance on minerals, as there are substantial opportunities in other sectors.
He says that the country’s development cannot be solely reliant on the base metals, oil and gas prices, as this is just not how a modern State should operate.
Moreover, Bonza notes that the country also suffers from electricity generation and distribution shortfalls, which, therefore, offer “substantial opportunities” for private investors and energy service providers.
He mentions that the lack of stable and cost effective energy to downstream industries is “undoubtedly” a hindrance to economic development and is something that all stakeholders in the country are eager to address with the support of private enterprises.
Further, he elaborates that the cartography of the country’s road and rail network was designed by Belgium, the former colonial master, to facilitate the transport of goods from the east to west of the country, which was done purposefully to ensure the ease of transport to metropolitan areas of the country, which is where the country’s ports are located.
“This is an indication that not only are parts of the country unequally developed, but that there is a lack of integration of the economy. Hence, the country still is scarred by the legacy of colonial infrastructure planning, which was geared towards the export of Congolese resources to Europe and not the betterment of the local population,” Bonza asserts.
Therefore, he again highlights that there is “significant opportunities” for investors and construction companies to support infrastructure development projects that link up all regions of the country.
However, he acknowledges that there are substantial challenges that exist for foreign companies that want to enter the country, owing to the lack of transparency relating to tendering processes, security and general concerns regarding corruption in the DRC.
The country was meant to have a national election in November 2016 to replace President Joseph Kabila. However, the President refused to step down at what was meant to be the end of his constitutional mandate and this decision has caused political unrest, with protestors regularly clashing with authorities, resulting in deaths and mass displacements throughout the country.
Bonza says that, once the election takes place, this will go a long way to improving safety and stability in the country. No date has been set for the election and the country’s electoral commission has yet to publish the electoral calendar.
“This situation is untenable and could worsen rapidly; therefore, it is a matter of absolute necessity that the DRC hold elections as soon as possible to avoid a very explosive situation emerging that could potentially plunge the country back into one of the bloodiest periods in its history,” he concludes.