Miners, investors uncertain about future in DRC

THE SURPRISE outcome of Congo’s election – a vote meant to bring closure to years of turmoil under President Joseph Kabila – has done little to ease uncertainty for miners and investors in a country crucial to the electric vehicle revolution.

The DRC is the world’s leading miner of cobalt, a mineral used in electric car batteries which has seen a surge in demand in recent years, with mines run by firms including Glencore and China Molybdenum.

Opposition candidate Felix Tshisekedi, an unknown quantity for mining executives, was declared the winner of last month’s chaotic vote on Thursday, defeating Kabila’s chosen successor, Emmanuel Ramazani Shadary.

The stakes for mining firms are high. In a study last year, McKinsey forecast a 60% increase in demand for cobalt by 2025, and cited uncertainty in Congolese government policy as one of the major risks to supply.

Tshisekedi has little political track record for investors to judge.

Relations between miners and the government hit a nadir over the code, signed into law in March, which raised royalty rates across the board.

“Increasing taxes on multinationals was way too popular a move to easily turn back,” a source said.

Five mining executives contacted by Reuters said they were not yet operating on the assumption that Tshisekedi’s win would be validated by the Kabila-appointed Constitutional Court and expected the outgoing president to fight to keep his stranglehold on the sector. None wanted to speak on the record.

Companies could find themselves caught in the crossfire of turf wars over ministry jobs and positions in the bureaucracy, not knowing who is really in charge.