China–Democratic Republic of the Congo relations

China-Democratic Republic of the Congo relations

China
Democratic Republic of the Congo

Sino-Democratic Republic of the Congo (DRC) refers to the current and historical relationship between the DRC and the People's Republic of China (PRC).

History

In October 1960 the newly independent DRC, then called the Republic of the Congo (Léopoldville), established diplomatic relations with the Republic of China (ROC).[1] The DRC changed recognition in February 1961 to the People‟s Republic of China (PRC), changing back again to recognise ROC later the same year in September. Relations were again established between the DRC, then known as the Republic of Zaire, and the People‟s Republic of China in November 1972 and have remained intact since.[2]:43

During the time that the DRC/Zaire recognised Taiwan, between 1961 and 1971, the PRC supported and provided material support to anti-Zairian rebels. After Zaire's president, Joseph-Désiré Mobutu, reverted recognition back to the PRC eight Chinese leaders visited Zaire between 1978 and 1995. Mobutu himself visited the PRC five times despite the fact that their relationship was not very close at the time.[3]

Economy

Information on Chinese commercial activities is mysterious and inaccessible in both DRC and their home country. This can only intensify the doubts as to their transparency and the manner in which they meet their legal obligations.[4]:24

In June 2000 a Sino-Congolese telecommunications company (China-Congo Telecom) was set up between ZTE and the Congolese government in a deal worth RMB80 million in concessional finance from China EXIM Bank. In April 2009 South African telecommunications group MTN Group offered to buy ZTE's 51 percent stake in the company for US$200 million.[2]:43 As of January 2010 the DRC has not yet been given Approved Destination Status (ADS) by China due to ongoing civil conflict in the country.[2]:44

Trade between China and the DRC greatly increased between 2002 and 2008. This is largely due to massive growth in the DRC's exports of raw materials to China. In 2007 the DRC exported US$304.8 million worth of cobalt. In 2008 the DRC exported US$1.13 billion of cobalt to China. Exports of copper ore and hard woods to China also increased greatly.[5]:43

Sicomines

A deal was struck between Sicomines, a consortium of Chinese companies (Sinohydro and China Railway Engineering Corporation), and the Congolese government in April 2008 to grant mineral concessions in Katanga province in exchange for infrastructure investments. In a deal originally worth US$9 billion and funded by China EXIM Bank, US$6 billion would go to infrastructure development and US$3 billion being invested in mining operations in Katanga. 68% of the project would be owned by Sicomines and the remaining 32% would be owned by Congo’s mining parastatal Gécamines.

The US$6 billion was originally to have been invested in a total of 6,600 km of road would be either built or rehabilitated, two hospitals and two universities being built. The mining concessions in Dima: Dikuluwe and Mashamba West would have given Sicomines access to 10.6 million tons of copper and over 600,000 tons of cobalt. With 6.8 million tons of copper and 427,000 tons of cobalt being confirmed deposits. The mine will come online at the earliest in 2013.

The Congolese and Chinese side have argued that the financing provided to Sicomines by China EXIM Bank is not to be seen as regular government debt since, as stated in article 10.1 of the contract, it is taken on by the joint venture and is backed by the mineral concessions. The articles 10.3, 13.2 and 13.3.3 of the contract are however the stumbling blocks in the context, stating that the Congolese state guarantees the repayment of the loan.[5]:34

Critics of the project have alleged that the deal undervalues the mineral deposits in Katanga. The International Monetary Fund (IMF) has raised concerns about this deal negatively affecting the DRC's ability to sustain its debt. As the deal would disqualify the country from the IMF's foreign debt relief program run under the auspices of the World Bank Group’s Highly Indebted Poor Country (HIPC) program as the DRC would be getting its debt canceled only to be taking on even more new debts. The IMF has argued that in order for the DRC to remain eligible and the deal to go through the value of the Sicomines deal would have to be greatly reduced. In May 2009 the Congolese government agreed to put on hold US$3 billion of the deal while a feasibility study for the mineral concessions is finalized.[5]:33–34

Benefaction

The governor of Katanga province Moise Katumbi, province estimates that over 60 of the province’s 75 processing plants, around 90%, are owned by Chinese nationals.[6] Most of these operations are privately owned limited liability companies owned by Chinese nationals. They are known to have poor environmental and labour relations records and have been accused, directly or indirectly, of using child labour.[4]:12–15 In 2007 about 600 Chinese nationals were expelled from Katanga for violating labour and environmental laws.[6]

Building Projects in the DRC

Since 1972 the PRC has given a number of donations to the DRC. Including a farm on the outskirts of Kinshasa, a sugar refinery in Kisangani, and the National Assembly building (at the time costing US$42 million or US$186 million in 2011 dollars[7]) were all built and given to the DRC in the 1970s. The Chinese government also built an 80,000 seat stadium in 1994.[2]:43 In 2004 the PRC built and donated the N'Djili Sino-Congolese Friendship Hospital, handing it over to the DRC government in 2006.[2]:44 According to AidData, from 2000 to 2011, there are approximately 21 Chinese official development finance projects identified in DRC through various media reports.[8]

Bibliography

References

  1. ↑ http://www.china.org.cn/english/features/focac/183553.htm China.Org.Cn website where it says "In October [1960], the Congolese Kasavubu government "established diplomatic relations" with the Taiwan Authority."
  2. ↑ 2.0 2.1 2.2 2.3 2.4 Hon, Tracy; Jansson, Johanna; Shelton, Garth; Liu, Haifang; Burke, Christopher; Kiala, Carine (January 2010). "Evaluating China’s FOCAC commitments to Africa and mapping the way ahead" (PDF). Centre for Chinese Studies, Stellenbosch University. Retrieved 24 January 2011.
  3. ↑ Chinese Ministry of Foreign Affairs (2006-10-10). "Congo (DRC)". Retrieved 24 January 2011.
  4. ↑ 4.0 4.1 Marks, Stephen (2010). "Strengthening the Civil Society Perspective: China's African Impact" (PDF). Fahamu. Retrieved 16 March 2011.
  5. ↑ 5.0 5.1 5.2 Burke, Christopher; Jansson, Johanna; Jiang, Wenran (August 2009). "Chinese Companies in the Extractive Industries of Gabon & the DRC: Perceptions of Transparency" (PDF). Centre for Chinese Studies, Stellenbosch University. Retrieved 24 January 2011.
  6. ↑ 6.0 6.1 Clark, Simon (22 July 2008). "China Lets Child Workers Die Digging in Congo Mines for Copper". Bloomberg. Retrieved 16 March 2011.
  7. ↑ Measuring Worth, Relative Value of a U.S. Dollar Amount - Consumer Price Index, retrieved on the 24/01/2011
  8. ↑ Austin Strange, Bradley C. Parks, Michael J. Tierney, Andreas Fuchs, Axel Dreher, and Vijaya Ramachandran. 2013. China’s Development Finance to Africa: A Media-Based Approach to Data Collection. CGD Working Paper 323. Washington DC: Center for Global Development.http://china.aiddata.org