Congo in talks with Rus­sia's VTB for $1bn in­vest­ment

Kuwait Times - - BUSINESS -


Demo­cratic Repub­lic of Congo is in talks with Rus­sian sta­te­owned bank VTB over po­ten­tial in­vest­ments worth as much as $1 bil­lion, Con­golese of­fi­cials said, though VTB said there had been no dis­cus­sions about bi­lat­eral lend­ing. Africa's top cop­per pro­ducer has been hit hard by low com­mod­ity prices in re­cent years. It has only enough for­eign cur­rency re­serves to cover about three weeks of im­ports and its franc cur­rency has lost half its value in the past year.

The gov­ern­ment is dis­cussing pos­si­ble as­sis­tance with the In­ter­na­tional Mon­e­tary Fund but Western donors are re­luc­tant to aid the gov­ern­ment of Pres­i­dent Joseph Ka­bila, who re­fused to step down when his con­sti­tu­tional man­date ex­pired last De­cem­ber. Prime Min­is­ter Bruno Tshibala's of­fice said in a state­ment late on Mon­day that VTB rep­re­sen­ta­tives, in­clud­ing Manag­ing Di­rec­tor and Head of African Orig­i­na­tion Ray­mond O'Leary met with Tshibala on Mon­day to dis­cuss a pos­si­ble $1 bil­lion in­vest­ment fund to fi­nance "strate­gic projects".

The state­ment cited Al­bert Yuma, chair­man of Congo's state min­ing com­pany and pres­i­dent of its cham­ber of com­merce - who or­ga­nized the meet­ing with Tshibala - as say­ing it would be "up to the gov­ern­ment to de­cide how the funds are used". In a state­ment, how­ever, VTB said its meet­ings in Congo were re­lated to ad­vis­ing Congo about "suc­cess­ful fu­ture cap­i­tal rais­ing trans­ac­tions" and "not with bi­lat­eral lend­ing".

Congo has tried to cul­ti­vate closer diplo­matic ties to Rus­sia amid grow­ing strains in its re­la­tion­ship with the Euro­pean Union and United States over its fail­ure to or­ga­nize elections on time and al­leged hu­man rights abuses. In March, Congo's for­eign min­is­ter Leonard She Ok­i­tundu met with his Rus­sian coun­ter­part Sergei Lavrov in Moscow, where he of­fered Lavrov "a box of rare min­er­als" as a birth­day gift, ac­cord­ing to the Con­golese min­istry's Twit­ter feed.

VTB, Rus­sia's sec­ond-largest bank, is one of sev­eral Rus­sian fi­nan­cial in­sti­tu­tions the United States sanc­tioned in 2014 over Moscow's sup­port for sep­a­ratists in eastern Ukraine. It was also at the cen­tre, along with Switzer­land's Credit Suisse, of $2 bil­lion of loans taken out in secret by the Mozam­bique gov­ern­ment, which has since de­faulted on re­pay­ment. VTB has de­nied any wrong­do­ing re­lat­ing to the trans­ac­tions, which IMF Manag­ing Di­rec­tor Chris­tine La­garde de­scribed as "clearly con­ceal­ing corruption" on the part of the Mozam­bique gov­ern­ment. — Reuters

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