China and the DRC Resolve Mining Deal Dispute
A potential rift between China and the Democratic Republic of Congo (DRC) has been averted as the Congolese government successfully addressed a controversial mining deal with China.
The deal, signed sixteen years ago, had recently raised concerns and strained relations between the two nations.
Government officials from the DRC revealed that open discussions with Beijing led to a revised agreement. President Felix Tshisekedi’s administration had accused China of extracting essential metals from the DRC without adequately supporting local communities.
On January 29, officials announced the new $5.8 billion deal, with specific requirements for Chinese mining companies to contribute to local infrastructure development for Congolese residents.
The revised contract mandates Chinese firms to pay nearly $6 billion over the next 20 years, a significant increase from the previous $1.2 billion over 15 years.
According to André Wameso, Deputy Director of Cabinet for President Tshisekedi, Chinese companies committed to constructing 7,000 kilometers of roads in the DRC, valued at $7 billion, over the next two decades.
The Chinese side has agreed to build 650 kilometers of roads worth $624 million in 2024 alone, with annual financing of $324 million for road construction.
The renegotiated contract also involves tax exemptions of approximately $100 million, and the DRC is set to benefit from $240 million in royalties on Sicomines’ annual turnover, a company managing mining earnings under the arrangement.
The new terms give the Congolese side a larger stake in the company, addressing previous imbalances.
Source: Business Insider Africa
