Democratic+Republic+of+the+Congo+Minerals

==It Is Highly likely China Will Continue To Invest In The Democratic Republic Of Congo’s Minerals Sector In The Next Five Years Despite Reports Of China’s Exim Bank Withdrawing Support On The Sicomines Deal==

It is highly likely China will continue to invest in the DRC minerals sector in the next five years despite reports of China’s Exim bank withdrawing support on the Sicomines deal. China will continue mining operations in the DRC due to the vast amounts of strategic minerals it contains despite impacts on human rights, the environment and socio-cultural relations. The total mineral wealth of the DRC is estimated at USD 24 trillion and contains coltan, cobalt, copper, gold and diamonds making it one of the richest countries in world. In 2008 China and the DRC signed a deal that China would have access to the biggest mines in the country and in return China would build infrastructure projects such as roads and a railway; however it has been reported that China's Exim Bank has withdrawn its support, potentially crippling this deal. A joint venture between China and the DRC will start producing in 2015 and this is from the Sicomines joint venture agreement from 2008 at USD 3 billion. There are 6.8 million tons of proven copper and an initial 50,000 tons will be available for annual output and will gradually rise to 400,000 tons over the next two decades.
 * Executive Summary: **

The total mineral wealth of the DRC is estimated at USD 24 trillion and contains coltan, cobalt, copper, gold and diamonds making it one of the richest countries in the world. In September 2007 China and the DRC signed an agreement for USD 9 billion however it was later reduced to USD 6 billion because of the International Monetary Fund's concerns over the DRCs debt. It is a minerals-for-infrastructure deal involving China Railway Construction Corp. and Sinohydro Corp and the DRC Gecamines. As of May 2013 62 percent of the mineral wealth is owned by Chinese enterprises and the rest belongs to the state-owned Congolese. As of December 2012 the implementation of the Sicomines agreement has been suspended because China Exim Bank withdrew financial support for the project; the exact reasons are unknown. The Congolese are looking for new financial backing and have been in negotiation to secure financing with China Development Bank, Bank of China and China Exim Bank. This deal would improve Congolese infrastructure and develop mines in the Mashamba basin, the Dima basin, the Dik Colline D syncline, and Kolwezi areas.
 * Discussion: **

According to IHS Global Insight, the politico-military situation, corruption, smuggling and a shortage of development capital have stifled the development of the industry. IHS also reports columbo-tantalite, coltan, which is located in the Kivu provinces especially around Goma and it is believed to hold nearly 80 percent of global reserves. The DRCs coltan has been identified as one of the leading causes of the conflict in the Eastern part of the country and attempts are being made to ensure that mobile phone manufacturers stop using coltan that is sourced there. Copper is found across Southern Katanga in a 140-mile by 30-mile strip that fans out from Katanga into Zambia; this area is known as the copper belt. The country's diamonds are concentrated in Kasai Orientale province, especially around Mbuji Mayi and there are secondary reserves around Kisangani in the northeast. Gold is found throughout the Eastern highlands, from Uvira to Aru; manganese resources are primarily around Kolwezi in Katanga. Tin and Cassiterite are found in substantial quantities in eastern provinces, especially in North Kivu near the Rwandan border, and in northeastern Katanga province near Manono . The biggest mine is the Bisie mine, in Walikale territory and this mine alone in 2009 was estimated to account for 70 percent of the cassiterite output in North Kivu which the most tin rich province in the country.

Even though China's Eximbank withdrew financial support on the Sicomines deal, the DRC is too heavily vested in improving their country and are seeking other potential benefactors. The DRCs mineral wealth is extremely vast and at this time it is unknown what organization will step in to provide funding; however it would be a grave mistake on the Chinese to not reinvest in the DRCs mineral wealth.

** Analytic Confidence: **
Analytic confidence is high. Source reliability ranges from medium to high. There is no conflict between sources. The analyst had low expertise on the subject, worked alone while also collaborating with a group, and did not use a structured analytic method. The subject is moderately complex and the deadline was moderately easy to meet.


 * Analyst: ** James Gibson