Over $400 million in tax advances and loans that the state mining company for the Democratic Republic of Congo Gecamines, said it paid to the national treasury cannot be found, according to a report by the General Inspectorate of Finances (IGF), as cited by Reuters.
Gecamines presented accounts to auditors from the General Inspectorate of Finances (IGF) indicating tax advances and loans to the Congolese state of more than $591 million, but only $178 million could be traced to the treasury’s accounts, as cited by Reuters.
The report, which is dated May 31, 2022, but has not been publicly released, stated the missing $413 million were alleged to have been “misappropriated” and that auditors would continue their investigations. The public finance watchdog did not specify when the advances and loans in question were made.
The report stated that another $175 million paid to the state mining company as a signing bonus for a copper and cobalt project “could not be traced” to the treasury either. The IGF faulted the company for failing to independently evaluate the levels of mineral reserves at its joint ventures with foreign investors.
Gecamines produced about 500,000 tonnes of copper a year during its prime three decades ago, but it has since fallen heavily into debt and sold off its majority stakes in major mines.
The company holds minority stakes in several of the world’s largest copper and cobalt projects, including Glencore’s Kamoto Copper Company mine and China Molybdenum’s Tenke Fungurume mine.
Gecamines has long been resolute about accusations of corruption made by non-governmental organisations and opposition politicians. Despite all these, Gecamines has always denied all allegations of wrongdoing.
Previous Corruption Allegations
In December 2021, Mr Albert Yuma, the chairman of the Democratic Republic of Congo’s state mining company was ousted after longtime allegations that billions of dollars in revenue had gone missing.
Gecamines was criticized during Mr. Yuma’s tenure for signing deals with foreign mining companies, including entities backed by the Chinese government.
Top US State Department officials had urged the Biden administration to impose sanctions on Mr. Yuma, who at the time was cited to have said that he had by his own count been accused of diverting as much as $8.8 billion in mining revenues over the years.
President Felix Tshisekedi, who replaced Mr Yuma at the time has since overhauled Gecamines’ leadership, replacing the executives most closely connected to previous corruption allegations.
Gecamine’s activities have included buying cobalt from the informal miners, also known as artisanal miners, and regulating pricing. Cobalt produced by artisanal mining, as opposed to industrial operations, makes up about 30 percent of the nation’s output.
President Tshisekedi, during his assumption of office announced plans to increase safety at Gecamine’s sites. Child labor and frequent injuries and deaths associated with such mining have drawn international attention, driven away new U.S. investors and even made some automakers reluctant to buy cobalt from Congo.
Congo is Africa’s top producer of copper and the world’s leading miner of cobalt, crucial resources in the push to expand electric vehicles and other renewables.
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