DRC-China: Infrastructure component of ‘contract of the century’ pinned down

DRC-China: Infrastructure component of ‘contract of the century’ pinned down

DRC-China: Infrastructure component of ‘contract of the century’ pinned down

The report submitted by President Félix Tshisekedi’s ministers regarding the infrastructure component of the so-called “Sino-Congolese” programme reveals several shortcomings.

The DRC’s President Félix Tshisekedi continues to re-evaluate the “contract of the century”, which Joseph Kabila’s administration signed with China in 2008.

This agreement provided for the bartering of Congolese copper and cobalt in exchange for the construction of infrastructure worth a total of $9bn. In 2009, this amount was revised downwards to $6bn following pressure from the International Monetary Fund (IMF).

This contract’s mining component had already been the subject of a first report by mines minister Antoinette N’Samba Kalambayi. On 20 September, her colleague Alexis Gisaro Muvunyi (infrastructure) presented his conclusions on the second part of the contract.

In a 16-page report entitled État des Lieux du Programme Sino-Congolais’ (State of play of the Sino-Congolese programme), which we were able to consult, the minister assesses the part of the agreement entitled Infrastructures Contre Ressources Naturelles’ (Infrastructure Against Natural Resources.)

Capped investments

Although this document does acknowledge certain “achievements”, such as job creation and technology transfer, as well as several Chinese companies’ interest in infrastructure projects, the results are simply not there.

According to Muvunyi, even though the mining project has been 77% implemented (with $2.4bn invested out of the $3.2bn planned), the infrastructure project has only been 27.5% implemented. To date, the Chinese have only invested $969m ($825m excluding interest) out of the $3bn planned for this phase of the project.

Another major problem is that the infrastructure works’ funding has been capped at $1.053bn following a decision by the board of directors of Sicomines, the Chinese-Congolese company in charge of implementing the mining project and repaying the mining and infrastructure investments. This cap had been introduced by the Chinese-Congolese conglomerate – in which the Chinese party has a majority stake – because the mining operations were slow to start.

The $825m invested have thus far been allocated to 40 projects in various sectors (roads, buildings, drinking water supply, etc.), 13 of which are still being implemented.

The minister has highlighted a long list of difficulties: “low level of project planning”, “lack of feasibility studies”, “inadequate payment mechanisms that fail to meet the projects’ needs and objectives.”

Simple “consultative voice”

He feels that the Chinese exerted too much influence on Sicomines’ decision regarding the timetable for the allocation of funds and, in doing so, reduced the DRC – the principal ministry concerned – to a mere “consultative voice.”

Muvunyi goes on to write that capping Chinese investment at $1.053bn can no longer be justified today, given the expected jump in mining production once the Busanga plant is commissioned.

Conceived as “one of the critical and essential links to realising all the projects planned within the convention’s framework”, this hydroelectric power station project, the contract for which was signed back in 2009, has long struggled to take off. According to the minister, commissioning it – 12 years later – should help double the annual production of copper and thus increase the annual amount of funding to $1.5bn from 2022.

Finally, Muvunyi recommends – among other things – “forcing Sicomines to review its cap” and resolving the constraints linked to the Busanga project’s implementation, in particular relocating and compensating the plant’s local residents.