Congo President to meet mining heads to discuss code revision

5 March 2018 (Last Updated March 6th, 2018 07:13)

Democratic Republic of Congo President Joseph Kabila plans to meet the heads of mining firms on Tuesday to discuss a code revision that would increase taxes and royalties.

Democratic Republic of Congo President Joseph Kabila plans to meet the heads of mining firms on Tuesday to discuss a code revision that would increase taxes and royalties.

The bill was initially adopted by the Parliament in January and has been opposed by the industry as it is likely to repel investments and violate various current agreements, reported Reuters.

Several international mining companies currently operate in the country, including Glencore and Randgold.

“The code revision could lead to an increase in royalties on cobalt, an important element used in batteries of electric cars, from the existing 2% to 10%.”

The code revision may lead to an increase in royalties on cobalt, an important element used in batteries of electric cars, from the existing 2% to 10% if the metal is deemed as a ‘strategic substance’.

Currently, the existing law safeguards miners from becoming vulnerable to any changes in fiscal and customs regimes for a period of ten years. However, any changes to the stability clause will impact the companies.

Congo has the largest reserves of cobalt in the world. Its cobalt production rose by 15.5% in 2017 to reach a total of 73,940t.

The industry previously sent letters to the President on 31 January and 8 February, alleging that its concerns were not considered during the code revision process.

The letters from Mines Minister Martin Kabwelulu have been addressed to Srinivasan Venkatakrishnan, Mark Bristow, Ivan Glasenberg and Lars-Eric Johansson, the current CEOs of AngloGold, Randgold, Glencore, and Ivanhoe respectively.

China Molybdenum subsidiary CMOC International CEO Kalidas Madhavpeddi also received the letter, reported Bloomberg.

According to the letters, these executives will have to personally attend the meeting and not send their representatives.