DR Congo: Civil society groups call for reassessment of China mining deal

Civil society groups and NGOs in the Democratic Republic of Congo are calling for another reassessment of a controversial “minerals for infrastructure” deal with China.

When it was renegotiated more than a year ago, it was described as the “contract of the century", but the “Congo is not for Sale” coalition says the agreement is heavily skewed in favour of the Chinese group.

It warns of financial losses and a lack of transparency which puts the Congolese state at a disadvantage.

Originally signed in 2008, it granted Chinese companies access to extensive copper and cobalt mines in exchange for infrastructure development.

The new agreement was meant to yield nearly $4 billion in additional benefits for the Congolese, but watchdogs say the new terms have not rectified previous imbalances.

Kinshasa, however, claims the new agreement signed last year is a win-win partnership, with infrastructure investment increasing from $3.5 billion to $7.5 billion.

The coalition disagrees, saying that the Chinese mining company still benefits from full tax exemptions, resulting in an annual loss for the state of at least $100 million in revenue.

In addition, the infrastructure financing, under which the DRC must receive more than $300 million a year, is subject to the copper price being equal to or greater than $8,000 per tonne.

If it is lower, then the funding will not be made available. If the copper price soars, the Congo will still receive the same amount, preventing it from benefiting from market upswings.

A further criticism of the deal lies in its fixed payment structure, regardless of the volume of minerals extracted.