Si­comines: A Suc­cess­ful Case of Min­eral In­dus­tri­al­iza­tion in Africa

China Today (English) - - CONTENTS - By FUNEKA YAZINI APRIL FUNEKA YAZINI APRIL is an ex­pert with Hu­man Sciences Re­search Coun­cil of South Africa.

Chi­nese com­pa­nies’ in­dus­tri­al­iza­tion of cer­tain ar­eas in Demo­cratic Re­pub­lic of Congo serves as a dif­fer­ent mode of trad­ing with the African Con­ti­nent.

SI­COMINES is prov­ing a min­eral in­dus­tri­al­iza­tion suc­cess story on the African con­ti­nent. On April 22, 2008, a ground­break­ing agree­ment on co­op­er­a­tion in min­ing and in­fra­struc­ture de­vel­op­ment, so cre­at­ing the min­ing com­pany Si­comines, was signed be­tween a con­sor­tium of Chi­nese com­pa­nies ( Si­no­hy­dro and China Rail­way En­gi­neer­ing Cor­po­ra­tion), and the Con­golese gov­ern­men­towned min­ing com­pany Gé­camines to grant min­eral con­ces­sions in ex­change for in­fra­struc­ture in­vest­ments. The Si-

comines agree­ment is worth US $6.7 bil­lion in to­tal. The Chi­nese are ex­pected to in­vest about US $3 bil­lion in in­fra­struc­ture and US $3.7 bil­lion in other min­ing de­posits in the Demo­cratic Re­pub­lic of Congo ( DRC). It is im­por­tant to bear in mind that the Si­comines agree­ment con­sists of two com­po­nents, min­ing and in­fra­struc­ture, and that growth of in­fra­struc­ture is a ma­jor con­trib­u­tor to­wards in­dus­trial de­vel­op­ment.

The sign­ing of the Si­comines agree­ment prompted a ma­jor out­cry from in­ter­na­tional in­sti­tu­tions such as the World Bank and the In­ter­na­tional Mon­e­tary Fund (IMF). One of the key rea­sons for the global at­ten­tion that the 2008 China-DRC agree­ment drew was the amount of Chi­nese fund­ing in­volved. An­other was the fact that although African coun­tries have been ex­port­ing raw min­er­als for decades, the con­ti­nent’s big­gest chal­lenge re­mains its in­abil­ity to in­dus­tri­al­ize. China’s plan to in­dus­tri­al­ize cer­tain ar­eas of the DRC through in­fra­struc­ture de­vel­op­ment acts as a dif­fer­ent mode of trad­ing with the con­ti­nent. The ef­fec­tive­ness of in­dus­tri­al­iza­tion as an en­gine of eco­nomic growth and de­vel­op­ment can­not be over­stated.

Among the other rea­sons why the Si­comines agree­ment is so sig­nif­i­cant is that it speaks to is­sues such as la­bor, and also the im­bal­ance of re­source ex- traction be­tween Africa and the global com­mu­nity. As re­gards la­bor, many ar­ti­cles chron­i­cle the view that Chi­nese com­pa­nies do not hire lo­cals in Africa but in­stead bring Chi­nese work­ers to im­ple­ment in­fra­struc­ture projects. Min­eral ex­trac­tion, on the other hand, is still a con­tro­ver­sial is­sue, be­cause de­spite its ex­tra­or­di­nary abun­dance of min­er­als, the con­ti­nent re­mains poor. This is at­trib­ut­able to there be­ing no ap­pro­pri­ate use of min­eral re­source rev­enue streams in Africa through which to fos­ter the con­ti­nent’s in­dus­tri­al­iza­tion.

How­ever, we re­cently car­ried out a field­trip to Si­comines to as­sess its im­pact on the DRC, from a na­tional and lo­cal per­spec­tive, by look­ing at in­di­ca­tors such as in­fra­struc­ture de­vel­op­ment and la­bor. As re­gards in­fra­struc­ture, the im­pact was sig­nif­i­cant. Si­comines has com­pleted most of the more ur­gent in­fra­struc­ture projects. These in­clude the Boule­vard du 30 juin, the es­planade in front of the Peo­ple’s Palace, Boule­vard Tri­om­phale, and Tourism Av­enue. Si­comines has also con­structed more than 220 km of roads, pro­vided 19 gen­er­a­tor sets and 6626 so­lar pan­els. The im­pact of the roads was im­mense, par­tic­u­larly since the coun­try was amid post­con­flict re­con­struc­tion and had lim­ited in­fra­struc­ture. Cur­rently, tarred roads, such as Boule­vard du 30 Juin in cap­i­tal city Kin­shasa, are pop­u­lated with tall sky­scrapers con­sis­tent with busi­nesses that did not ex­ist 10 years ago. In­deed, 10 years ago, one needed a 4×4 truck to mo­tor around Kin­shasa. This has since changed due to the in­fras­truc­tural ac­cess. In­dus­trial de­vel­op­ment thus pro­motes eco­nomic growth as it makes en­gag­ing in trade and com­merce eas­ier.

The is­sue of Chi­nese com­pa­nies mainly uti­liz­ing Chi­nese la­bor is also not ap­pli­ca­ble to the Si­comines case. If any­thing, Kol­wezi, the min­ing com­mu­nity where Si­comines is based, has reaped con­sid­er­able ben­e­fits from the min­ing agree­ment. The Si­comines plants rep­re­sent a crit­i­cal de­vel­op­ment and ca­pac­i­ty­build­ing en­deavor on the part of the DRC, em­ploy­ing 3,000 work­ers, 76 per­cent of whom are Con­golese. Ac­cord­ing to Si­comines, the com­pany spon­sors train­ing ac­tiv­i­ties to build the ca­pac­i­ties and skills of the lo­cal work­force. Since 2013, more than 20,000 lo­cal em­ploy­ees have re­ceived train­ing in var­i­ous ar­eas such as man­age­ment skills, taskspe­cific knowl­edge, and that re­lat­ing to the im­ple­men­ta­tion of en­gi­neer­ing tools, se­cu­rity, law com­pli­ance, and codes of con­duct. In­ter­est­ingly, de­spite crit­i­cisms from the World Bank and IMF, both or­ga­ni­za­tions, af­ter vis­it­ing Si­comines in May 2015, gave pos­i­tive assess­ments of the China-DRC joint ven­ture.

The re­search trip demon­strated that the Si­comines deal has ben­e­fited Con­golese cit­i­zens, as the min­ing com­pany has spared no ef­fort in ful­fill­ing the provisions of the 2008 agree­ment. The Si­comines case demon­strates that the Chi­nese in­vest­ment struc­ture could serve as a par­tial so­lu­tion to a con­ti­nent in need of cap­i­tal-in­ten­sive in­vest­ment in­fra­struc­ture and eco­nomic mod­ern­iza­tion. As ear­lier men­tioned, the big­gest chal­lenge fac­ing min­eral ben­e­fi­ci­a­tion in 21st-cen­tury Africa is the lack of in­dus­trial de­vel­op­ment. The need for in­fra­struc­ture is demon­strated in a 2013 Afro­barom­e­ter poll among 24 sub-Sa­ha­ran coun­tries. It es­tab­lished that Africans con­sid­ered jobs or in­fra­struc­ture as their most im­me­di­ate needs. Suf­fice it to say, based on my in­ter­views with DRC lo­cals, the prom­ise of an in­dus­tri­al­iza­tion rev­o­lu­tion through in­vest­ment in in­fra­struc­ture, pub­lic util­i­ties, and ser­vices has gained great ap­peal among DRC na­tion­als. In essence, the Si­comines agree­ment has proven a suc­cess­ful case of min­eral in­dus­tri­al­iza­tion. The is­sue for African coun­tries now is to de­ter­mine whether the 2008 China-DRC model can be bet­ter crafted to pro­mote min­eral ben­e­fi­ci­a­tion as es­poused by the holis­tic strat­egy of African Min­ing Vi­sion and the “2063 Agenda” that African Union em­barked on for de­vel­op­ment and pros­per­ity.

China’s plan to in­dus­tri­al­ize cer­tain ar­eas of the DRC through in­fra­struc­ture de­vel­op­ment acts as a dif­fer­ent mode of trad­ing with the con­ti­nent.

Si­comines op­er­ates an a SSR-XT slope sta­bil­ity mon­i­tor radar sys­tem in a cop­per-cobalt mine in Kol­wezi, Demo­cratic Re­pub­lic of Congo in 2015.

Newspapers in English

Newspapers from China

© PressReader. All rights reserved.