Should you invest in the DRC, or not?
There is never a dull moment to be had when covering recent developments in the Democratic Republic of Congo’s (DRC) mining sector – particularly over the last year following the official introduction of the country’s new Mining Code.
It is no secret that the DRC’s established mining companies received the new code with resistance. In essence, it has removed a number of benefits that were in existence to encourage investment in the country. What comes to mind first and foremos is the removal of the 10year stability clause and a relatively hefty increase in taxes.
Since then the government has also affirmed cobalt as a strategic mineral and as such the taxes on this metal have been hiked – a lot!
One should appreciate that the reasoning behind the government’s actions is understandable: it needs additional revenue to build infrastructure and develop the economy, which would naturally benefit the mining industry as well. However, concerns remain over legacy issues of corruption. The industry wants to see its hardearned money being put to good use.
While we are on the subject, let’s also acknowledge that while the DRC may have its challenges with regard to legislation and the infrastructure required to develop new mines with relative ease, the situation is not unique. No country or continent, for that matter, is without tedious processes or legislative requirements – it is in the nature of the business and has been put in place to protect the country and preserve the rights of its people. By way of example, I understand Canada and Australia can take up to 10 years to award a mining right. Consider that challenge for just a moment.
Yet, in spite of all the difficulties I’ve mentioned, mines are built and industries are developed. I am confident that if you follow the rules and processes you can build your mining business successfully, in the DRC or anywhere else. Don’t forget that there are many largescale mining operations in the central Africa country after all, more than in most other regions on the continent. And may I suggest that you take the time to learn the local language or employ someone who does – that always helps.
To reinforce my point, Mining Review Africa took to Twitter to ask our audience how they feel about investing in the DRC at present and the answers speak for themselves:
However, if you remain uncertain then staying abreast of developments is important and the best place to do that is the annual DRC Mining Week conference in June this year which takes place in Lubumbashi.
The Mining Review Africa team will be there to cover the event so if you can’t make it, or even if you can, stay tuned to our website, YouTube channel and upcoming editions of the magazine – we’ll keep you informed! In the buildup to the conference, this issue takes a look at all things trending in the DRC which you can read about from page 22.