DRC Secures $324 Million Annually in Revised Chinese Mining Contract
The Democratic Republic of Congo (DRC) is set to receive 957.2 billion Congolese Francs (CDF), equivalent to $324 million, in annual royalties under a revised contract with Chinese companies, effective in 2025. This amendment, signed in January 2024, seeks to enhance infrastructure investment in the country.
Key Terms of the Agreement
- Annual Payments: The DRC will receive $324 million annually until 2040, provided copper prices remain above $8,000 per tonne.
- Profit Sharing: If copper prices exceed $12,000 per tonne, 30% of the additional profits will be allocated to infrastructure projects.
- Increased Contributions: Chinese companies, which contributed $1.2 billion over the past 15 years, are now expected to invest $6 billion over the next two decades.
Funds from the agreement will primarily support the construction of roads and other essential infrastructure, a move aimed at opening up remote provinces and fostering regional connectivity.
The revised contract was prompted by a study conducted by the General Inspectorate of Finance (IGF), which highlighted an imbalance favoring Chinese companies. In response, President Félix Tshisekedi initiated negotiations to ensure a fairer profit-sharing mechanism.
As part of the deal, the DRC has increased its stake in the Sino-Congolese Mining Company (SICOMINES) to 32%, enabling greater oversight of production and sales activities.
The Congolese government views the amendment as a pivotal step for the country’s economic growth and a reduction in reliance on external funding.
Improved infrastructure is expected to unlock development opportunities while fostering financial transparency in resource management.
The success of the revised agreement hinges on global copper market fluctuations. Authorities plan to closely monitor prices to ensure the continuity of planned investments.
This renegotiated deal is regarded as a milestone in the management of the DRC’s natural resources, paving the way for local development and greater financial equity.
