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DR Congo - China Relations

As is the case in many African nations, China is working hard to expand its ties with the DRC. Chinese interest in the DRC comes at a moment when the GDRC is itself searching for significant investment to assist with social and economic development, as well as equipment (such as boots and uniforms) for the Congolese military.

There are three principals of Chinese engagement in the DRC. First, China supports the DRC as a fellow developing country with shared challenges. Second, China has long-standing relations with the DRC, including past assistance in infrastructure development projects such as the Parliament building and Marytrs sports stadium. Finally, China continues to support the DRC's development through both official assistance and the mining/infrastructure agreement.

The story of Chinese (PRC) involvement in the Democratic Republic of Congo (DRC), dating to the 1960 when the DRC was barely into its second decade as an independent nation, is long and complex. The Republic of Congo gained its independence on Jun. 30, 1960. At the time Premier Zhou Enlai and Foreign Minister Chen Yi sent a respective message to Lumumba Government, expressing the congratulation and recognition. In August, the two governments of China and Congo began to talk on the establishment of diplomatic relations but came to a stop due to the coup staged by Mobutu.

In October, the Congolese Kasavubu government "established diplomatic relations" with the Taiwan Authority. On February 19, 1961 China recognized the government headed by Gizenga as the sole and legitimate government of the Congo and established diplomatic relations between the two countries on February 20 that year. On September 18 the same year as Gizenga went to Adula and the government had so called "diplomatic relations" with the Taiwan Authority, China decided to call back its embassy, hence the temporary suspension of the relations between China and Congo.

In 1964, the Congolese government headed by Tshombe Moise changed the country name into the Republic of Congo, shortened as the Congo (Li). American support for the Congo continued unabated during the Johnson administration. US military assistance increased dramatically in response to the fall of Stanleyville (Kisangani) to rebel forces on August 4, 1964. Planes provided by the Department of Defense, flown by pilots supplied by the Central Intelligence Agency, augmented the CNAs efforts against an increasingly robust rebel insurgency, which received support from neighboring African nations, the Soviet bloc and Chinese Communists.

In November 24, 1965, Mobutu, commander of the national army, overthrew the Kasavubu government and assumed president himself with the name of the capital city changed into Kinshasa in 1966 and later on October 27, 1971 changed the country name into the Republic of Zaire. China and Zaire realized normal relations on November 24, 1972 and since then the relations between the two countries saw a constant development. President Mobutu visited China for five times (January 1973, December 1974 March 1980, June 1982 and October 1994). The other Zaire leaders and officials who visited China include: Nguza Karl-I-Bond, Minister of Foreign Affairs and International Cooperation (November 1973), Kassongo Mukumgi, Speaker of the National Assembly (July 1984), Wa Dondo Kengo, First Member in charge of the State Affairs (June 1986).

Chinese involvement in the DRC in the Mobutu era (1965-97) featured large, highly visible projects were the rule. The Stade des Martyrs (Martyrs Stadium) project (which is now in such disrepair that FIFA refused to schedule soccer games there unless the DRC made repairs to the tune of USD three million by end April 2008; this was not achieved), the Palais du Peuple (the Parliament Building) and other infrastructural projects including hospitals were all completed during the 1970's, 1980's, and early 1990's. Following the economic collapse of the early 1990's and the subsequent conflicts that wracked the Congo, Chinese presence was less visible and funding seemed to dry up.

In May 1997, the Mobutu government was toppled by Laurent-Desire Kabila who assumed the head of the state and resumed the name of the country "The Democratic Republic of the Congo". The two countries continued to consolidate and develop the friendly and cooperative relations. In December 1997, President Kabila paid a state visit to China. In January 2001, Kabila was assassinated and his son Joseph Kabila succeeded him as president. In March, 2002 President Joseph Kabila paid a state visit to China.

All this changed as the DRC emerged from over a decade of war and worldwide demand for commodities, especially metals including copper and cobalt, has skyrocketed along with the prices for those metals. Since the early 2000's, China has ramped up its presence and exchanges with the DRC, mostly on the basis of trade in the Congo's natural resource sector. What was earlier an informal, somewhat disorganized collection of Chinese businesses, most operating in the Katanga Province of southern DRC, has begun to be formalized over the past year, beginning with a large, multi-billion dollar agreement between three large Chinese parastatals and the GDRC, signed in September 2007. China has political and military interests in the DRC. China is a member of the CIAT, the International Committee to Accompany the Transition, an Ambassadorial-level body which meets regularly to monitor the progress of the Congo's transitional government and help guide it forward on the basis of a common policy approach. On the military side in addition to an engineering brigade, China also contributed a Level II military field hospital (also in Bukavu) to MONUC. In October 2005, an additional 60 Congolese officers are scheduled to go for training at various Chinese military academies (again, for six months). This training is a natural extension of a long-standing military cooperation relationship, as President Joseph Kabila himself received some military training in China.

Historically, China exerted its security presence in Africa through contributions to United Nations peacekeeping missions. It has long used its U.N. involvement to protect its interests. In the Democratic Republic of Congo a major supplier of copper and cobalt to the Chinese economy China contributed 220 troops to the UN mission, MONUSCO.

The DRC and China signed a declaration establishing a "strategic partnership" during the Beijing Summit Forum on China-Africa Cooperation in November 2006. Even before this signing, the state-owned China National Overseas Engineering Company (COVEC) loaned the DRC copper and cobalt mining parastatal, GECAMINES, USD 60 million to reopen a copper mine in Katanga Province. At about the same time, the Chinese government loaned the GDRC USD 32 million to fund a mobile phone network in support of the Congo China Telecom company, a cellular service provider.

DRC exports to China doubled between 2003 and 2004, while Congolese imports from China increased by more than 50 percent in each of the three years following the establishment of a transitional government in 2003. As of 2005, Congolese exports to China total about $100 million, and primarily consist of natural resources including copper, cobalt, and timber. Again according to the Chinese, the DRC imports about $40 million worth of products from China -- primarily cheap manufactured goods, household appliances, shoes, medicine, and a significant quantity of textiles. In fact, inexpensive Chinese textile imports have almost wiped out the Congo's once viable domestic textile industry. The Chinese Embassy's Commercial Section in Kinshasa said there were about 100 private Chinese businesses and approximately 800-1000 Chinese citizens in the DRC. The US Embassy believed this number to be potentially much higher, particularly in Katanga province.

During the September 2005 visit, the GDRC began negotiations on a Chinese bid for a cobalt concession and refinery. The bulk of current Chinese investment is in the mining sector, concentrated in Katanga province, which is rich in copper, cobalt, heterogenite, gold, uranium and other minerals. Some Congolese officials have indicated that, in exchange for mining concessions, China is willing to provide 20,000 uniforms, boots, tents and other equipment to the Congolese military.

Congolese-Chinese ties are being encouraged by the Israeli business community in the DRC, particularly the Gertler and Weisenblom families who have themselves significant investments in various sectors of the Conglese economy, particularly the diamond industry. For instance, in September 2005 GDRC officials (accompanied by Dan Gertler, an Israeli diamond dealer) made their third official visit to China in les than a year. (President Kabila headed a trade delegation which visited China early this year, and subsequently senior members of the Congolese government visited China again.

The year 2007 saw sustained levels of exports, mostly mineral ores, that attained nearly USD three billion for the year. Imports from China nearly doubled between 2006 and 2007 to over USD four billion, meaning that a country with a budget of barely more than USD two billion had a nearly USD one billion trade surplus with China. Preliminary figures for 2008 showed no decline in this trend, with January figures indicating a nearly 50 percent increase in exports to China and a nearly 100 percent increase in imports from China over the same month in 2007. At this rate, the DRC may post a USD three billion trade surplus with China alone, rivaling the level of the national budget for the year. As in the days of King Leopold (1876 - 1909), much of the Congo's natural resource wealth is leaving the country, while the population still has relatively little purchasing power to buy the products, even cheap ones, that it needs or wants.

The September 2007 Deal - The Coltan Controversy

Cobalt and coltan, used in electric vehicle, smartphones and renewable energy technology are classified as strategic minerals by the DRC. Coltan [short for Columbite-tantalite] is a dull black tar-like metallic ore, from which the elements niobium and tantalum are extracted. Much of the Chinese business in the DRC was of an informal and ad-hoc nature. In the copper belt area of the DRC's Katanga Province, small Chinese-owned operations bought copper and cobalt ore that had been scraped together virtually by hand and concentrated to the extent possible before being shipped in "big bags," flexible sacks with a handle capable of holding around one ton each and transported on trucks carrying 20 of them at a time to ports in Dar es Salaam or Durban for onward shipment to China. China, although it has significant reserves of cobalt itself, became the world's leading producer of cobalt metal, much of it sourced from Katangan mines that were being picked over by thousands of Congolese artisanal miners, some of them underage and all of them poorly equipped, working in dangerous conditions and earning a pittance. The DRC is estimated to have about a third of the world's known cobalt reserves.

The China National Machinery, Equipment and Export Corporation (CEMEC) agreed to a USD 75 million loan for chrome and nickel mine in the Kasai provinces of central DRC, not far from the provincial capitals of Kananga and Mbuji Mayi. Kasai Occidental and its neighbor to the east, Kasai Oriental, site of the state diamond mining parastatal, MIBA, are isolated and underserved partly due to the decrepit condition of the rail line that passes through them from the Congo River north and west of the Kasais, down to the copper belt south and east of them. What was once daily service bringing goods both down from Kinshasa and up from Lubumbashi is now a maybe once-a-week train that makes irregular deliveries of basic good such as fuel and corn meal that can cost twice as much as in the rest of the country, when available. Much of this trade came to an abrupt halt in early 2007 following the elections of late 2006, when the new governor of Katanga Province, Moise Katumbi, decreed that all exports of raw, concentrated but unprocessed ores were prohibited. This edict put a temporary halt to most of the illegal, and even some of the legal, exports of copper and cobalt ore that had been occurring unchecked since the early 2000s. Total Chinese exports from the DRC dropped by more than a quarter during the first half of 2007, and did not begin to recover their previous level until midway through the year.

Chinese investment in the DRC, with an eye toward regaining the metal ore exports needed to support the booming Chinese economy, began in earnest in mid-2007. In August 2007, a delegation of Chinese businesses, including the ExIm Bank of China, the China Railway Engineering Corporation (CREC), and SINOHYDRO signed an agreement ("protocole d'accord") with the Congolese Minister of Infrastructure, Public Works and Reconstruction, Pierre Lumbi.

China and the DRC signed an agreement on 17 September 2007 for a total USD five billion loan to finance three billion dollars in infrastructure construction projects and two billion dollars in mining sector partnerships. The GDRC Minister of Public Works and Infrastructure, Pierre Lumbi, said that China-DRC cooperation is based on the principle of "bringing employment to Congolese." China has already invested USD 60 million in a joint venture mining project with parastatal Gecamines, and USD 32 million in the DRC telecoms infrastructure to support Chinese company Congo China Telecom.

China agreed to lend the Democratic Republic of Congo $5 billion to modernize the country's infrastructure and develop its mining industry. Under terms of the deal, the DRC will borrow $3 billion to build new infrastructure, including a major highway, a railway, 31 hospitals, 145 health centers and two universities. The highway will link Kisangani in northeastern Congo to Kasumbalesa near its southern border with Zambia. The railway will connect Congo's southern mining heartland to the western port of Matadi. Congo's government will use the remaining $2 billion to upgrade its aging mining infrastructure through joint ventures with Chinese companies.

In August 2008 General Nkunda began engagement of a serious escalation of fighting in North Kivu, complaining that Congolese soldiers and Hutu militia were a threat to his Tutsi brothers and sisters and he was rising up in resistance against the threat of more violence against the Tutsi in eastern Congo. Yet, in a call for negotiation during a ceasefire, Nkunda voiced his opposition to a $9 billion Sino-Congolese deal that would have allowed China access to Congos vast mineral reserves in exchange for infrastructure improvements. For someone whose main concern was the protection against the massacre of Tutsis, control of mining rights was an odd sticking point for ceasefire negotiations.

When the deal was announced it involved the Democratic Republic of Congo agreeing to give the Chinese consortium majority stakes in two of the biggest mines in the country, in exchange for $9 billion worth of infrastructure, including roads and a railway. Under pressure from western donors, who objected to the DRC governments offer of a state guarantee for the $9 billion when the Congo was asking them for massive debt relief, the deal was whittled down to $6 billion.

This agreement continued the pattern of large, highly visible infrastructure projects begun during the Mobutu years, which included the Martyrs Stadium and the Parliament Building in Kinshasa. More recent was the Chinese hospital center built near the airport and staffed largely with Chinese doctors and nurses. It also confirmed a move towards larger, more mainstream mining sector China-DRC joint ventures, perhaps replacing the smaller, "informal" Chinese operations that many had criticized in Katanga's copper and cobalt belt.

Two Chinese state companies China Railway Group and Sinohydro, the world's biggest hydroelectric firm signed another deal, a US$9 billion (58 billion yuan) agreement with Gcamines, the state copper company of the DRC. This deal, which was renegotiated down to US$6 billion (39 billion yuan) in 2009, promises the Chinese companies up to 10 million tonnes of copper and hundreds of thousands of tonnes of cobalt in exchange for building a range of infrastructure, including new mines, roads, railways, hydroelectric dams, housing, hospitals and two universities.

Recent Developments

Despite the fact that the highly touted Inga-Shaba line, which delivers power from the Inga hydroelectric installations of Bas Congo to the mines of Katanga Province and points south (Zambia, Zimbabwe and South Africa), the Kasais are virtually without power other than local generators since the transmission line was never branched for them.

Official, above-board Chinese investment and activity in the DRC directly addresses the country's most urgent needs, as expressed by President Kabila in his 2006 inaugural address, better known as the "Cinq Chantiers" (five pillars of reconstruction) speech: infrastructure; employment creation; housing, water and electricity; health; and education. While the details are still fuzzy in some cases, and the numbers may be off a bit, some 2000 miles of railway linking Katanga and Bas Congo provinces, 2000 miles of roadway linking Orientale and Katanga provinces, 31 hospitals, 145 health centers, two large universities and 5,000 government housing units were pledged by China.

Both the GDRC and the Congolese business community are interested in expanding ties with China to maximize trade opportunities and capitalize on no-strings economic assistance loans. Members of the business community in eastern Congo, for instance, say that they have increased trade with China and other Asian countries because of lower costs and ease of accessibility to markets. Unit prices and export duties are lower on Asian goods than on goods produced in Europe and other developed countries. Furthermore, transportation expenses on Asian goods are no higher than on those which arrive in eastern Congo from Europe or the U.S. via Kinshasa, because these goods must be flown in from Kinshasa, whereas Asian goods can be brought via rail from the East African coast.

China was also involved in several infrastructure projects in the DRC. The World Bank funded two Chinese road construction projects, one in Bas Congo province (western DRC), and another in North Kivu (eastern DRC). In addition, a Chinese engineering brigade was attached to the United Nations Mission to the Congo (MONUC) group in Bukavu, South Kivu (eastern Congo), and supposedly was responsible for maintaining the road linking the city to the distant airport. This road, perennially in varying stages of disrepair, did not seem to actually attract much attention from the Chinese engineering brigade.

Secretary of State Tillerson in March 2018 warned that Chinas approach encouraged dependency by using predatory loan practices to mire nations in debt and undercut their sovereignty. Some believe the debt trap narrative is overdone and glosses over the facts. Africa faces growing risk of debt distress, but China is the principal contributor to debt in only three countries: Republic of Congo, Djibouti, and Zambia.

there is no transparency in the infrastructure development program in Congo. The Congolese public does not know what infrastructure the Chinese companies are supposed to be building, nor do they know within what time frame. The DRC is likely aware of the obvious negatives: less local job creation and procurement than expected, less cost-savings than promised, and poorer quality (and dependability) of the infrastructure left behind. The DRC may perhaps be unaware of, or not care about, other more subtle drawbacks. These include the opening up of areas through road building that may increase illegal logging, exacerbate destruction of rainforest habitat, and provide opportunities for unscrupulous bushmeat hunters. Certainly the idea of creating entirely new plantations by first cutting down existing forest cover should give the GDRC authorities pause.

Africans complain about the quality of Chinese products and blame the Chinese for taking jobs or business from locals. There has been community violence against Chinese nationals in the Democratic Republic of Congo, Madagascar, South Africa, and Zambia. This animus is often directed at Chinese individuals, not necessarily at Beijing.





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Page last modified: 19-03-2019 09:54:24 ZULU