(Ecofin Agency) - Last year, amidst criticisms over the outcomes of its "mines for infrastructure" contract with China, the DRC government renegotiated with the Asian giant, securing an additional $4 billion. This might have been impossible if the contract’s terms had not been disclosed.

The $7 billion agreement signed between China and the DRC in mid-March 2024 shows how important transparency and disclosure are in mining contracts. According to the Extractive Industries Transparency Initiative (EITI), disclosing the contract’s terms helped increase expected earnings from the partnership to $4 billion. The project, it should be recalled, covers the exploitation of copper and cobalt.

Sealed in 2008, the original agreement allocated $3 billion for infrastructure development in the DRC. However, its disclosure enabled several civil society actors to criticize the imbalance in contract terms between the Congolese and Chinese parties. This includes the local EITI committee in the DRC, which published a study in December 2021 denouncing "unprecedented prejudice in the history of the DRC."

Not only were essential infrastructures (roads, hospitals, etc.) not realized as planned but the copper reserves upon which the investment decision was made were undervalued. This observation was later confirmed by a report from the General Inspectorate of Finance, showing that the DRC only received $822 million since the deal was implemented, while Chinese firms earned almost $10 billion in profits. 

These criticisms sparked public debate around the "mines for infrastructure" contract, leading Congolese authorities to request its renegotiation. If the contract’s terms had not been disclosed, the Congolese state might have not signed this new agreement. The new deal, it is worth noting, helped the country secure $4 billion more to build around 5,000 km of roads.

"By aligning its efforts with national priorities, EITI-DRC leveraged EITI disclosures to conduct analyses and stimulate public debate, aiming to inform policies that strengthen revenue mobilization, ensure equitable resource distribution, and promote sustainable development," the EITI wrote in a blog post dated March 25, 2024.

Though the new deal is still criticized by the civil society, which is concerned about the secrecy surrounding the negotiations and terms still too favorable to the Chinese party, benefits obtained through previous disclosure should encourage Congolese authorities to continue on this path. This includes making public the method used to reach the new $7 billion figure and involving civil society more in negotiations on mining contracts, through public consultations, for example.

Emiliano Tossou