China mining activities in the Democratic Republic of Congo may suffer disruptions as Kinshasa seeks to review a mining deal it signed with China more than a decade ago.
Kinshasa believes the reworking of the contract would help securing all the funding that was pledged for infrastructure projects and a share of windfall profits.
Under the 2008 deal struck with the government of former President Joseph Kabila, Chinese state-owned firms Sinohydro Corp (SINOH.UL) and China Railway Group Limited agreed to build roads and hospitals financed by profits from Congo’s Sicomines cobalt and copper joint venture.
Critics say few of those projects have been realised.
Congolese Prime Minister Jean-Michel Sama Lukonde said during an interview in Sharm El-Sheikh, Egypt, during the COP27 climate summit that a review of the 2008 minerals-for-infrastructure contract that includes the Sicomines copper-cobalt mining project should ideally be concluded by year-end.
Additional payments were warranted because the project was making super-profits due to a surge in commodity prices, he said.
Meanwhile, last year a report commissioned by a global anti-corruption body of governments, companies and activists urged the Kinshasa government to renegotiate its $6 billion infrastructure-for-minerals deal with Chinese investors.
The report described the deal that was first signed in 2008 as “unconscionable” and urged Kinshasa to cancel an amendment signed secretly in 2017 that sped up payments to Chinese mining investors and slowed reimbursements of investment in infrastructure.
This report was released in October 2021 by the Extractive Industries Transparency Initiative (EITI), which tracks revenue flows in the oil and mining sectors and counts more than 50 countries, including DRC, as members.
However, the report has no legal force but, if it’s main conclusions remain, it said could bolster Kinshasa’s push to secure more favourable terms from mining contracts with Chinese investors.
