While some mining operations in the DRC have been able to continue production despite COVID-19 lockdown restrictions, the country’s mining industry faces a tough post-pandemic period, although this also provides opportunities for investors.
This is the view of several DRC mining industry pioneers who shared valuable, insights and reports from mines on the ground during a webinar titled Post-COVID-19: A brave new world for the DRC.
Hosted by Mining Review Africa and DRC Mining Week, the panel of experts comprised Boris Kamstra, director: Pangea Exploration and Alphamin Resources; Louison Kiyombo, partner: tax and legal, KPMG DRC; Amedeo Anniciello, CEO, Standard Bank DRC and Louis Watum, MD: DRC Operations, Ivanhoe Mines DRC and president of DRC Chamber of Mines.
According to Watum, the entire mining industry in the DRC has shown unprecedented solidarity to government and local communities during the pandemic.
“We see mining operators coming together and contributing in all sorts of ways, including taking extraordinary measures to keep operations going under a strict lockdown configuration and protecting the health of their employees and not retrenching people.”
Listen to the webinar:
Doing business in post-COVID-19 DRC
Meanwhile, Kamstra also lauded the staff of the Alphamin Bisie tin mine in North Kivu that was still fully operational, although he admitted that the remote location was a benefit to the operation during the pandemic.
“Being isolated does give us a degree of immunisation. We’ve got a team onsite – we were firm believers in their superhuman abilities before this event – and they have now proven how much they are actually able to keep it going.”
However Kiyombo cautioned that the country’s mining sector, at 20% the largest contributing sector to the state coffers, was already hampered by the COVID-19 pandemic.
“A decrease in exports means a decrease in tax collection. When mining companies are obliged to cut costs it may end in job losses.”
Government must come to the party
While Anniciello agreed that exports have slowed down, he added that COVID-19 had not been the only factor to negatively impact the country’s mining industry.
“I think there have been a number of other issues that have also impacted on the mining industry, one of which was the new mining code last year and some of the mines have been trying to get to grips with what it means and how it will impact them.”
Looking ahead once the pandemic has passed, Watum stated, “I think it is going to be the survival of the fittest post-COVID-19. And who is going to be the fittest?
“It is those that are well-funded, with deep pockets, with less debt and with very strong management. I therefore see an increase in M&A activities post-COVID-19, where the big players with a lot of cash and experience will be shopping around for opportunities that have lost a lot of value and have become affordable,” he concluded.