Civil society organizations criticize a mining agreement between the DRC and China, asserting it disadvantages the Congolese state with an anticipated loss of $132 million in 2024. The CNPAV coalition urges the government to renegotiate terms that rely heavily on fluctuating copper prices, highlight a fixed payment structure regardless of production levels, and condemn ongoing tax exemptions for Chinese companies. Calls for transparency and fairness persist as infrastructural promises remain unfulfilled.
A significant mining agreement between the Democratic Republic of Congo (DRC) and a consortium of Chinese companies is experiencing renewed criticism from non-governmental organizations (NGOs) and civil society groups. These entities assert that despite recent updates to the deal—referred to as the ‘contract of the century’—the terms remain disproportionately favorable to the Chinese, which is projected to lead to a loss of $132 million for the DRC in 2024 alone.
The coalition known as CNPAV, which translates to “Congo is not for sale,” calls for the government to renegotiate the contract in hopes of establishing a more equitable arrangement. Originally signed in 2008 under the presidency of Joseph Kabila, this significant deal allowed Chinese firms access to lucrative copper and cobalt reserves in exchange for infrastructural development promises. Following renegotiations in early 2024, the agreement was anticipated to generate nearly $4 billion in added benefits for the DRC; however, concerns persist regarding its fairness.
One prominent worry pertains to the reliance of funding for infrastructure on fluctuating copper prices. Under the updated terms, the DRC expects to receive $324 million annually for road infrastructure over a 20-year span, but this funding is assured only if copper prices exceed $8,000 per tonne. If prices drop below this benchmark, CNPAV warns that the DRC could receive significantly less or potentially nothing. Moreover, even in a scenario where copper prices climb to $12,000 per tonne, the Congolese government would obtain the same fixed payment, denying the country the opportunity to benefit from price increases.
Critics also point to the deal’s rigid payment structure, which remains constant regardless of the actual mineral output. Baby Matabishi, coordinator at the Carter Center-DRC and a CNPAV member, emphasizes the illogical nature of a fixed payment for varying production levels. He expresses concerns about the uncertainty of copper prices, suggesting that it further complicates the reliability of the agreed payments. CNPAV also highlights the tax exemptions provided to Chinese firms, which reportedly cost the DRC over $100 million annually, compounding the financial disadvantage.
While the Kinshasa administration argues that infrastructure development will eventually compensate for these fiscal shortcomings, NGOs assert that many projects linked to the contract remain incomplete or do not meet quality standards. Therefore, the outcry for a renegotiation of the contract underscores the ongoing concerns about transparency and equity in the DRC’s dealings with foreign entities.
The mining agreement between the DRC and China is under significant scrutiny due to allegations of substantial financial losses and a lack of transparency. NGOs highlight concerns regarding the dependence on volatile copper prices, fixed payment structures, and tax exemptions that disadvantage the DRC. Despite government assurances of infrastructure gains, civil society groups indicate lingering issues that could compromise the benefits promised by the deal, advocating for a reassessment of the agreement in the interest of fairness and accountability.
Original Source: allafrica.com
