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
Novo Nordisk cuts Wegovy prices in South Africa amid competition Move targets rival Eli Lil...
WAEMU posts 3.31 trillion CFA francs trade surplus in Q4 Exports surge 50.4%, led by gold, ...
The BCEAO now allows UEMOA citizens abroad to open CFA franc accounts under the same conditions as...
Operator explores renewable energy partnership with Italy’s Ascot Energy Move aims to stabilize p...
First investor town hall since 2021 signals renewed engagement with markets Authorities hi...
Move aims to boost housing finance and expand affordable housing supply Bank to support real estate sector amid 800,000-unit housing deficit The...
Côte d’Ivoire ratifies tax agreement with Qatar to avoid double taxation Deal strengthens trade ties and improves tax transparency, cooperation Move...
Togo launches irrigation project with 400 boreholes under ProMIFA Initiative includes training, digital tools, and community management systems Aims...
CAR signs $98 million mechanization deal with UK-based DSR Group Programme to deploy tractors, equipment, and expand agro-processing...
The Bijagos Archipelago, located off the coast of Guinea-Bissau, stands as one of West Africa’s most extraordinary island systems. Made up of around forty...
RFI confirmed the end of “Couleurs Tropicales” following Claudy Siar’s departure after 31 years. The move follows a series of high-profile exits...