Congo’s state auditor has demanded an additional $17 billion of investments from a 2008 infrastructure-for-minerals deal with Chinese investors that is currently being renegotiated, documents seen by Reuters on Thursday showed.
President Felix Tshisekedi’s government has been revisiting the deal struck by his predecessor Joseph Kabila under which Sinohydro Corp (SINOH.UL) and China Railway Group Limited agreed to build roads and hospitals in exchange for a 68% stake in Sicomines, a cobalt and copper joint venture with Congo’s state mining company Gecamines.
Under the Sicomines deal, the Chinese investors committed to spending $3 billion on infrastructure projects, but the state auditor – Inspection Generale des Finances (IGF) – demanded that commitment be increased to $20 billion, to reflect the value of the mining concessions that Gecamines contributed to the deal.
A Sicomines official did not immediately reply to a request for comment. He has previously defended the deal, saying it had driven development for Congo’s people and that Sicomines would invest more as production increased.
So far, Sicomines has only spent $822 million on infrastructure investments, according to the IGF report seen by Reuters. The auditor also called for an “immediate” $1 billion investment from Sicomines, and a commitment to 50% of the workforce on infrastructure projects being Congolese.
Among a list of 16 demands, the IGF called for the “renegotiation of the Convention to adjust and balance the duties and benefits of both parties and bring them into line with the value of their respective contributions”.
The auditor also demanded that Gecamines be given a bigger stake in Sicomines. It currently has a 32% holding.
Congo’s finance minister Nicolas Kazadi said last month that the government expects to reach an agreement on the Sicomines deal this year.