Submit this form
Home News Videos Music Photos Facebook Twitter Friends Newsletter Podcasts Mobile RSS
$70 Million in Congo Mining Revenue Untraceable, Investigators Say

VOA News - March 5, 2012
A general view of the Gecamines copper mine in the Democratic Republic of Congo's southern mining town of Lubumbashi
A general view of the Gecamines copper mine in DR Congo's southern mining town of Lubumbashi (August 2005 file photo) | Enlarge
Anti-corruption investigators in the Democratic Republic of Congo say they cannot trace more than $70 million that mining companies claim to have paid to the government.

Professor Jeremy Dumba is the Congo coordinator of a global anti-corruption watchdog, the Extractive Industries Transparency Initiative, or EITI.  His team has collected figures on what mining companies say they paid the DRC government, and what the government says it received from those companies.  On Thursday, he announced that he could not make the two sets of figures match.

Dumba said there are a lot of gaps in the figures, and he and his team had not been able to reconcile the payments declared by companies with the state’s receipts.  He said it was very difficult to get figures from the state revenue service that matched what the companies had declared.

Dumba submitted the figures as part of a long-overdue EITI report on Congo.  He said the latest figures collected for the years 2008 and 2009, show mining companies say they paid tax revenues far higher than what the government says it received from them.  In 2008 for example, they declared payments of $121 million, while the government said it received $69 million.  In 2009 the gap was smaller -- $99 million paid, say the companies; $73 million received, says the government.

EITI

The EITI was launched by the British government in 2002 and is supported by the United States and other Western countries. It brings together governments, companies and civil society to try to ensure that taxes from mining, oil and gas are properly accounted for and go to national treasuries. The initiative aims to improve governance in countries that depend on those industries so that the revenues are used to reduce poverty.

The amount of tax that companies say they pay should equal what governments say they receive.  For most other countries applying for EITI membership the amounts are more or less equal.  But figures for Tanzania and Mali also show gaps of tens of millions between payments and receipts.

Congo has applied for membership of the scheme, and President Joseph Kabila has said that his government is committed to it.  But before becoming a full member, the country’s reports on company payments and tax receipts have to be approved by the EITI board.

Unreliable data

Dumba said the figures for the DRC's oil industry add up, but the data has has been able to collect on the mining sector is not reliable.

Another Congolese anti-corruption expert, Jean-Claude Katende, said it was difficult for Congo to provide accurate figures because its mining industry is more complex than the industry in other countries.

"You have countries that have three or four or 10 mining enterprises whereas in the DRC you have more than 200 mining enterprises," Katende noted.  "And to that you should add the petroleum industry and the comptoirs."

Comptoirs are licensed exporters of minerals.

Data

Another problem, Katende said, is that Congo does not have a centralized databank for its mining sector.  But, he said, the government is working with donors on a plan to computerize mining data, which will then be held centrally.

The gap between what mining companies pay and what Congo's government should receive may be far greater than the tens of millions unaccounted for in Dumba’s report.

Mining companies may be hiding some of their income and thus paying less tax than they should. Dumba said he knew of cases where this may have been happening.

He said for example there's the case of a company that exported 400,000 tons of minerals.  They should have paid 2 percent tax on that, but their tax declaration came to much less, indicating that they hadn't declared all their income.

It has also been claimed that in the past few years the government has sold large mining concessions at far less than their market price. British member of parliament Eric Joyce, chairman of the UK Parliament Great Lakes of Africa group, has alleged that in the past four years Congo has lost more than $5.5 billion through the sale by the government of mineral assets at less than their fair market value. He said the sales had been made through offshore companies which had captured the profits.

Transparency

When asked about Joyce’s allegation last year, President Kabila said he was not going to respond to a British MP. He said his commitment to good governance was meant to benefit the Congolese people, not to please foreign politicians.

As evidence of open dealings, Kabila said that his government’s $9 billion mining deal with a Chinese consortium, its biggest deal in the mining sector, was only signed after it was debated and approved by the parliament.


Related articles


  1. DR Congo Scores High on Growth, Lags in Poverty Reduction: IMF (October 13, 2015)
  2. Congo Improves Natural Resources Accounting (July 4, 2014)
  3. Kerry in DR Congo for Security Talks (May 3, 2014)
  4. Regional Leaders Sign DR Congo Peace Deal (February 24, 2013)
  5. U.S. SEC requires company disclosures on use of DR Congo minerals (August 23, 2012)
  6. U.S. and U.K. Must Tell Rwanda to Stop Supporting Rebels in DR Congo, Global Witness Says (June 29, 2012)
  7. Police Investigate Former Prime Minister for Corruption (May 14, 2012)
  8. DR Congo Economic Growth Set to Reach An Unprecedented Seven Percent in 2013 (April 12, 2012)
  9. DR Congo, IMF to Co-Host Conference on the Management of Natural Resources (March 13, 2012)
  10. 32 Million Congolese Voters Set to Elect Their Leaders (November 27, 2011)
  11. Candidates to Make Last Stand in Kinshasa before Monday's Election (November 26, 2011)
  12. Rwanda gives DR Congo back tonnes of smuggled minerals (November 3, 2011)
  13. Kabila Confident He Will Win Re-Election (October 18, 2011)
  14. UN advises prudent use of abundant resources to spur development (October 10, 2011)
  15. DR Congo growth above 7 percent in 2010 - IMF (September 3, 2011)
  16. Case of UN Employee Caught Smuggling Minerals Not Unique (August 25, 2011)
  17. UN Employee Arrested for Trying to Smuggle Tin Ore (August 22, 2011)
  18. Controversy over "conflict minerals" law (August 2, 2011)
  19. Global Witness welcomes DR Congo's decision to publish resource contracts (June 3, 2011)
  20. Opportunity for change in eastern Congo's mines must be seized (May 18, 2011)
  21. Gold smugglers charged in Kenyan court (May 12, 2011)
  22. Etienne Tshisekedi Rallies Supporters in Kinshasa (April 24, 2011)
  23. New Law Aims to Halt Sale of Conflict Minerals (April 18, 2011)
  24. New rules for miners (March 17, 2011)
  25. Plight of the Congo Is Focus of U.S. Congress Hearing (March 8, 2011)
  26. Kabila, Kibaki meet over smuggled gold from eastern Congo (March 6, 2011)
  27. Foreign 'gold smugglers' arrested in eastern Congo (February 7, 2011)
  28. Companies Struggle in Conflict Mineral Index (December 14, 2010)
  29. WikiLeaks Founder Arrested in London (December 7, 2010)
  30. List of facilities 'vital to US security' leaked (December 5, 2010)


Live TV Congo Radio en ligne Radio
Available on App Store
Get it on Google Play



Contact Us | About Us | Édition en Français | French Edition

© CongoPlanet.com. All rights reserved.