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How DRC Wants To Control Cobalt Production




Democratic Republic of Congo has moved to control nearly 15% of worlds Cobalt production through its state company Entreprise Generale du Cobalt (EGC).

Jean-Dominique Takis Kumbo, the head of the new state cobalt buyer told press that EGC will have a monopoly on all hand-dug cobalt in the central African country, giving it power to improve working conditions and potential control.

Congo accounts for nearly 70% of the global supply of cobalt used in the lithium-ion batteries that power most electric vehicles.

According to Takis, he’s hoping that control of 15% is a market share big enough to help influence cobalt prices the way Saudi Arabian Oil Co., or Aramco, does with oil, and ultimately boost profit for the state.

“We believe that EGC will introduce the image and identity of Congo to the markets for those involved in cobalt,” said Takis.

However, there are ongoing concerns about the cobalt industry which have prompted miners and carmakers to reassure customers about ethically mined supplies of the metal.

For example in 2019, BMW AG said it won’t buy metal from artisanal sources, and like Tesla Inc., is among manufacturers backing initiatives to improve conditions at the sites.

Once EGC is up and running, all other buyers of artisanal cobalt will have six months to shut down, Takis said.

The state company will produce about 8,000 tons of cobalt contained in hydroxide form in 2021, with output expanding “exponentially” in the years to come, he said.

Details indicate that EGC is partnering with trading house Trafigura Group in a five-year deal to finance the creation and control of artisanal mining zones, ore-purchasing stations and costs related to buying, processing and delivering cobalt hydroxide to end buyers.

Trafigura is still assessing the investment required to prepare the first accredited mining site.

“We foresee a considerable body of work to bring the site up to a level that meets the newly launched EGC standard,” a Trafigura spokesperson said Thursday.

While artisanal miners’ contribution to Congo’s cobalt production has at times reached 20%, it dropped significantly last year amid low prices, the impact of Covid-19 and expanded industrial output, Andries Gerbens, a director of Darton Commodities, said by phone Friday.

While Gerbens expects artisanal output to increase again as the cobalt price rises, an 8,000-ton target for 2021 is “ambitious” and the possibility of EGC capturing Congo’s entire artisanal market is “unrealistic at least in the short term.”

Cobalt prices have risen almost 70% in the past year and now trade at more than $50,000 a ton on the London Metal Exchange.

Takis said mining production at first will be limited to a single site known as Kasulo in Kolwezi, a town 820 miles southeast of the capital, Kinshasa.

The initial investment to prepare the site will cost $15 million, after which EGC hopes to have $7 million to $8 million available per week to purchase and process cobalt into hydroxide form, Takis said.

While Trafigura will prepare all of EGC’s cobalt for market, the state company can keep 50% of the output for itself and sell it separately, Takis said.

It’s also in talks with processing plants in Congo that currently treat artisanal cobalt to switch to EGC’s product.

“These production plants will, one way or another, come to an agreement with EGC in order to continue to operate,” he said.

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Mozambique Scandal: Credit Suisse & U.S. Conclude Deal



Credit Suisse Group AG is nearing an agreement with the U.S. government that would resolve a criminal probe regarding its role in a U$2 billion Mozambique bond scandal, according to people familiar with the matter.

The discussions with the U.S. Justice Department involve a deferred prosecution agreement that would include a fine, according to the people, who asked not to be identified because the talks are confidential. An agreement is expected to be announced Tuesday.

Any deal with U.S. prosecutors would be the latest action in a multi-year, international legal saga arising out of the 2013-14 deals that were supposed to fund a new coastal patrol force and tuna fishing fleet in Mozambique, one of the world’s poorest countries.

In a 2018 indictment, the U.S. Justice Department alleged the contracts were a front for government officials and bankers to enrich themselves.

Three former Credit Suisse bankers have pleaded guilty to U.S. charges stemming from the scheme.

Credit Suisse declined to comment on any agreement, as did the U.S. Justice Department.

A deal could help put to bed one scandal, even as the bank has been punished this year by investors for its stumbles with Archegos Capital Management and Greensill Capital, which have spurred broad management shakeups.

Mozambique has filed suit against Credit Suisse and shipbuilder Privinvest, one of several cases in U.K. courts that involve the bond deal.

Unlawful Conduct’

In defending its London lawsuit, Credit Suisse has insisted that it was deceived by rogue bankers and couldn’t be held responsible for their “unlawful conduct” when it arranged the loans in early 2013.

The Swiss bank has said it carried out its usual due diligence before the transactions and was aware of the risk of bribery and corruption.

Andrew Pearse, who led the global financing group in the bank’s London office, testified at a federal trial in Brooklyn, New York that he’d pocketed at least U$45 million in illicit payments for his role in the arrangement of the loans.

The Credit Suisse loans were for three separate maritime projects including a tuna fishing fleet, the building of a shipyard and surveillance operation to protect Mozambique’s coastline and protect against pirates, according to Pearse.

Mozambican government officials, corporate executives and investment bankers stole about U$200 million, prosecutors said.

Both Pearse and his successor at the bank, Surjan Singh, who also pleaded guilty, testified at the 2019 trial of Jean Boustani, a Privinvest Group executive accused by the U.S. of being behind the plan to get Mozambique to borrow billions of dollars and overpay for dubious maritime projects.

A third banker, Datelina Subeva, Pearse’s subordinate, also pleaded guilty but didn’t testify.

All three bankers await sentencing. After a six-week trial in late 2019, a federal jury cleared Boustani of all charges.


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DRC Opposition Protests Against Phone Tax



Martin Fayulu, DRCs leader of opposition coalition LAMUKA has called upon all citizens to take to the streets and demand for the abolition of a controversial mobile phone tax.

In June 2020, the DRC government set up – through the ICT, Post and Telecoms Ministry – a CEIR system (Central Equipment Identification Register), with the aim to fight fake devices and the theft of mobile devices.

However, Telephony mobile users claim the Mobile Device Registry (RAM), a controversial new tax is robbing them of their units and making them poorer.

In terms of RAM, mobile operators are cutting a big chunk of units monthly from their customers’ mobile devices, which many users believe is too high and unnecessary.

“We are calling for the immediate withdrawal of RAM. Because it’s theft, a scam. That no one is demobilized. Let’s march and denounce it because it is outright  theft. Once withdrawn, all money collected must be returned, ”said Martin Fayulu.

During a meeting this Saturday, October 16, 2021 in Kinshasa, Martin Fayulu called for the outright abolition of this fee.

During the rally, the leader of Lamuka pinpointed other topical issues, including the issue of appointing the leaders of the Independent National Electoral Commission (CENI).

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Tanzania’s Economy Records 4.3% Expansion in 2nd Quarter



Tanzania’s economic outlook seems very impressive as the country registered a 4.3% expansion between April and June according to the country’s National Bureau of Statistics (NBS).

Compared to the country’s economic performance in the same period last year, there has been a 0.3% upward expansion.

Briefing the media on Friday, Daniel Masolwa NBS Director of Economics Statistics, said, “Real GDP increased to Shs 33.4trillion from Shs 32trillion in the corresponding period in 2020, an equivalent to a 4.3% growth,” he said.

During the second Quarter of 2020, Tanzania’s economy registered the lowest growth rate of 4.0% since 2017 mainly due to the devastating effects of Covid-19 pandemic following the introduction of lockdowns and many countries to mitigate spread of this pandemic.

However, Masolwa tried to cool down any skepticism saying, the annual economic growth in 2021 is projected at a 5.0% rate. In terms of economic activities, he  said, during the period under review, information and communication attained the highest growth of 12.3%, followed by electricity generation at 12.1%.

Meanwhile, other services include arts and entertainment and households as employers (10.8%), accommodation and food services (10.1%), water (8.4%), and mining and quarrying (7.3%).

According to Masolwa, the expansion of economy by 4.3% during the second Quarter of 2021 was spearheaded by key drivers of growth which include Agriculture (13%), transport and storage (8.4%), trade and maintenance (8.1%), manufacturing (7.6%) and construction (7.1%).

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