COGEP recommends Felix Tshisekedi to order IGF to audit SOKIMO and its unproductive partnerships
The Coalition for the Governance of Public Enterprises (COGEP) has documented the two partnerships of SOKIMO, namely KIBALI GOLDMINES and PIANETA and has just published its report during this week.
According to this organization, SOKIMO has concluded several joint venture contracts with private companies under Congolese law and foreign law. Most of these contracts have been the subject of much controversy as to their real impact on the profitability of SOKIMO and the gain of the Congolese State as sole shareholder.
As part of this study, the reflection focused on the joint venture contracts signed by SOKIMO with two private companies PIANETA and KIBALI GOLDMINES from 2009 to 2020 and which continue to have an impact to this day.
On reading these different contracts, COGEP brings out many questions, in particular on transparency in the process of concluding contracts, conflicts of interest, the real ownership of partner companies in joint ventures, compliance with the legislation, access to information, etc.
“Since 2006, a certain number of partnership contracts have been concluded between SOKIMO and private companies in an attempt to cover the company’s major expenses. A careful reading of the said contracts shows that they were concluded in violation of the mining legislation, the law on public procurement, the law on the withdrawal of public companies”, maintains this organization.
As proof, COGEP finds that: 1. SOKIMO’s share in joint-venture companies is always reduced and lower than that of the other partners; 2. The sale at a low price of mining titles belonging to SOKIMO; 3. The non-use of the call for tenders procedure as required by the relevant legislation; 4. Non-payment or cessation of payments due to SOKIMO such as dividends, royalties, key money and monthly annuities or farm-out rent by joint venture companies.
Therefore, COGEP recommends to the President of the Republic to order the IGF to carry out an audit of SOKIMO and its unproductive partnerships and to appoint a new Board of Directors.
To the Government, this NGO recommends avoiding politicizing the management of public enterprises by correctly playing the roles of shareholder and regulator; support the recovery of SOKIMO through a substantial budget allocation; to fight against conflicts of interest and corruption in the Joint-ventures by establishing transparent mechanisms for the negotiation of contracts and representation in the Joint-ventures; to ensure compliance with the tendering procedure before approving the transfer of mining titles; to set up a commission of experts capable of conducting contract negotiations that benefit portfolio companies and the state shareholder.
In this context, COGEP also asks Parliament to initiate a parliamentary inquiry into SOKIMO’s participation in the Joint Ventures; to question the members of the Board of Directors of SOKIMO on the opacity in the conclusion of joint venture contracts.
Recall that the government has transformed SOKIMO into a commercial enterprise in order to promote its good management, accountability, competitiveness and performance. But since its transformation, the emergence of SOKIMO has been delayed, since instead of being competitive and productive, it comes up against several constraints, political, financial and managerial.
