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sharing in governance of extractive industries

Hopes rise for transparency in the Democratic Republic of Congo

A grim history of secret mining deals in the Democratic Republic of the Congo (DRC) has prevented the country’s mineral wealth from benefiting its 67 million citizens. But political initiatives and international engagement give hope that the DRC is moving more quickly towards greater transparency.

Transparency is critical, because it reduces the opportunities for corruption and improves accountability. The lack of transparency in the global extractives sector helps explain why – despite its impressive mineral wealth – the DRC has some of the world’s worst malnutrition levels, its sixth-highest child mortality rate, and over 7 million children out of school.

But efforts to increase transparency must also reach into the international financial system, which toleratesillicit financial flows and therefore has facilitated corruption and conflict in one of Africa’s most populous countries. Directly and indirectly, conflict in the DRC has killed millions.

The Extractive Industries Transparency Initiative (EITI) represents one of the biggest forces for transparency in the DRC. According to one DRC-based observer, the EITI has generated “ripple effects that some countries might only dream of”, including impressive efforts to collect revenue data and a new focus on transparency and accountability.

Although the DRC’s status as an EITI-compliant country was suspended last year, because the DRC’s reports to the EITI did not meet the required standard, the EITI board nevertheless applauded “dedicated efforts in a challenging environment” by many in the DRC. The DRC recently published new EITI reports to disclose the government’s revenue from its natural resources, including oil and mining. The EITI board is set to review the suspension in April.

Meanwhile, the DRC’s Parliament is due this year to discuss important laws on how the DRC’s oil and mineral riches will be managed. Some campaigners say the laws do not include basic transparency measures or safeguards against corruption.

Despite the obvious benefits of transparency, pockets of resistance remain.

Last year’s Africa Progress Report showed how five concession deals between 2010 and 2012 cost the DRC an estimated US$1.36 billion through the systematic undervaluation of mining assets and their sale to offshore companies, a loss equivalent to roughly double the combined annual national budgets for health and education in 2012.

In October, the Africa Progress Panel voiced concern over another possible mining deal, in which the state-owned mining company Gécamines was proposing to sell its 20% stake in a major copper mine to a foreign company, Fleurette, under unspecified and non-transparent terms.

As Kofi Annan, chair of the Africa Progress Panel, told the BBC last May, “Transparency is a powerful tool”.

“I would challenge African governments,” Mr Annan said “to tell their people what agreements they have signed with this or that company, how much money they expect to get, how much money they have received and how they are using this money”.

This article was originally published at: www.africaprogresspanel.org

Photo credit: Gwenn Dubourthoumieu via Africa Progress Panel

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Comment by Mulya Jules on January 25, 2014 at 8:01

Hi Stephen Yeboah

It's always good hear a positive report on DRC; the problem is there are just too many unexplained historical issues that cloud our judgment of DRC stories. Could someone tell us the truth about the whole First Quantum debacle? We want to know what wrong the Canadian miner did and also what was the part of the DRC Government in this. It's obvious corruption what involved..it always takes two to do it. Please tell us! Thanks.

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