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Angola | South Africa

Tshikapa River Project | Longatshimo River Project

The Democratic Republic of the Congo gained independence from Belgium in 1960. After independence Colonel Joseph Mobuto Sese Seko came into power and renamed the country, Zaire. In 1997 he was overthrown by Laurent Kabila who made himself president and changed the country’s name to the DRC. Since then the DRC has had two more presidents and a civil war, commencing in 1998. Laurent Kabila was assassinated in January 2001. His son, Joseph Kabila, succeeded him as Chief of State and Head of Government and commenced negotiations with the rebel leaders to establish a transitional government. This was achieved in July 2003 and since then the country has been generally peaceful. Kabila was inaugurated president in December 2006.

Much activity occurs in the informal sector and is thus not recorded in GDP. Renewed mining activity had contributed to rising GDP from 2006-2008, however, growth was halted in the second half of 2008, due to the economic climate impacting prices on the country’s mineral exports. The DRC government has applied to the IMF for an Exogenous Shock Facility in the amount of $200 million to help it deal with its deteriorating financial situation, and the World Bank will consider a separate $100 million in emergency funding. The global recession probably will cut economic growth in 2009 to half its 2008 level. According to the CIA World Fact Book on the DRC, The GDP is estimated to be US$12.96bn for 2008 with the real GDP growth rate estimated at 8%. Exports were estimated to be US$6.1bn in 2007, with earnings comprised predominately from diamonds, copper, coffee and sugar. The country has seen significant improvements in the inflation rate from 135% in 2001 to 16.7% for 2007.

The country is well known for its extensive mineral wealth, especially the Copper Belt situated in the Katanga Province along the border with Zambia. The copper mines were historically operated by the State producer La Generale des Carrieres et des Mines (“Gecamines”) but due to the war the mines fell into disrepair and became uneconomic. In recent years the copper mines have received extensive interest from large international mining companies. These mines are being redeveloped. Official records of 2003 mineral production from the province include 12,000t of cobalt and 52,700t of copper.

The DRC is a major diamond producer primarily from artisanal operations situated in the Tshikapa, Mbuji Mayi and Kinsingani areas. The production reported for 2003 amounted to 21.1Mcts and represents 75% of the country’s total alluvial production. The remainder is sourced from La Societe Miniere de Bakwanga’s (“MIBA”) Mbuji Mayi mine in the Kasai Province. International mining companies have returned to the diamond areas within the DRC and are actively exploring for both alluvial and kimberlite deposits. The DRC is a member of the Kimberley Process.

International companies with exploration and/or mining interests in the DRC include BHP Billiton, De Beers Group, Anvil Mining NL, Kinross Gold Corporation, Adastra Minerals Inc, SouthernEra Diamonds Inc, Gravity Diamonds Ltd, GEM Mining, Metorex Ltd and Banro Corporation.

With the assistance of the World Bank, the New Mining Code (“NMC”) was passed in July 2002. The NMC governs the prospecting, exploration, exploitation, processing, transportation and sale of mineral commodities. All rights to minerals are vested in the State, and the State is responsible for the promotion and regulation of developments in the sector.

The type, duration and special requirement of the various licenses issued by the Mining Registry is summarised in the Table below. Licenses are only granted through an agent domiciled in the DRC or through a tender process in the case of “valuable known mineral deposits”.