DRC President Felix Tshisekedi has criticized a $6.2 billion mining deal with China, stating that the Central African nation, as the world’s biggest producer of key battery metals, hasn’t benefited from the contract.
In September 2021, the Democratic Republic of the Congo (DRC) started a review of a mining deal with China, signed over a decade ago, in order to secure all the financing for infrastructure projects that was promised under the agreement.
As the share in the profits, recently surged due to rising commodity prices, certain parts of the deal do not add up in order to let Congo move forward as intended.
The Chinese, made a lot of money and made a lot of profit from this contract Tshisekedi told journalists on the sidelines of the World Economic Forum in Davos, Switzerland, adding that now our need is simply to re-balance things in a way that it becomes win-win.
The DRC is abundant with natural resources, including copper and cobalt, which are of high demand on international market as major components in electric vehicles. However, the country is one of the world’s least-developed countries since the Belgium colonial times.
Therefore, it seeks to gain benefits from its own resources. The contract’s review is part of the president’s campaign to ensure that the DRC gets paid for providing its natural riches.
In 2008, Tshisekedi’s predecessor Joseph Kabila signed a minerals-for-infrastructure contract with China. It stipulated that Chinese companies invest $3.2 billion in a copper-cobalt mine and another $3 billion in infrastructure construction.
According to the contract, most of the minerals end up in China. At the same time, the DRC government claimed that China has released less than a third of the funds designated for infrastructure.
We’re happy to be friends with the Chinese, but the contract was badly drawn up, very badly, Tshisekedi said. Today, the Democratic Republic of Congo has derived no benefit from it. There’s nothing tangible, no positive impact, I’d say, for our population.
The president recalled that the contract was signed at a period when the country was emerging from decades-long conflict, while the newly elected president was seeking financing.
He underlined that the agreement was badly drawn up and failed to meet the interests of the nation. But, China’s ambassador to the DRC, Zhu Jing, stated that Chinese investment has created thousands of jobs in the country and lifted many Congolese out of poverty.
If there is a problem in the distribution of the profit, it is rather internal Congolese problems. The discussions, intended to improve the deal, have been going on for more than a year.
The president noted that the negotiations are dragging as the Chinese are the champions of marathon discussions, adding that DRC’s government is now undergoing this experience, but remains optimistic.
During the COP27 climate summit, which was held last year, the country’s Prime Minister Jean-Michel Sama Lukonde once again insisted on a thorough review of the deal, highlighting that China has spent about $900 million on infrastructure so far, which is less than required by the agreement.
Sputnik / ABC Flash Point News 2023.