by Boniface Mabanza, KASA
Those on the African continent and its diasporas who follow French or Francophone media have been aware of the shocking interview of Albert Yuma. The Interview took place in April 2021 and was conducted by the Journalist Alain Foka, who works with Radio France International and is titled „Who owns the Cobalt of the Democratic Republic of Congo? “. The reactions of Africans and people of African descent worldwide to this interview are numerous. With a few exceptions, there is unanimity on the question of what is wrong with Africa? Exactly the same question Jeffrey Sachs has raised in his speech at the UN Food Systems Pre-Summit in July .
In order to better frame the shock triggered by Yuma, this article will first outline who Albert Yuma is and why his statements are so shocking. Then, the article aims to show that the DRC’s experience is not unique in Africa, but that of all but a few resource-rich countries. This article ends with the question that many have asked: what is wrong with us and how can we change our destiny? This article is published on the occasion of the 9th year of the Marikana massacre. On August 16, 2012, 34 miners were brutally shot dead by South African police in the small town of Marikana in South Africa’s North West Province. They had done nothing but protest against their poor working and living conditions. They were rightly convinced that people who produce platinum, one of the most expensive metals in the world, deserve more than starvation wages, a life in tin shacks with no running water, no electricity, no proper sanitation and no assured health care, even though their work exposes them to the dangers of silicosis and tuberculosis. Nine years after the massacre, the conditions against which the workers had gone on strike remain largely unchanged. No one has yet been convicted for the massacre. This calls for a fundamental rethink of the mining sector in Africa. This article is intended as a provocation to that end.
Who is Albert Yuma?
He stands as a symbol of African irresponsible post-colonial elites. Albert Yuma is the president of Gécamines, more precisely of what remains of it, and president of the Congolese Business Federation. La Générale des Carrières et des Mines (Gécamines) is a Congolese commodity trading and mining company headquartered in Lubumbashi in the Katanga region of the Democratic Republic of Congo. It is a state-controlled company founded in 1966 and is the successor to Union Minière du Haut-Katanga. Gécamines is engaged in the exploration, exploitation and production of mineral deposits including copper and cobalt. Gécamines was once one of the largest mining companies in Africa and the largest in the Democratic Republic of Congo, holding the world’s largest cobalt deposits and some of the world’s largest copper deposits. Until 1997, Gécamines was protected by the 1966 Bakajika Law, which stipulated that the land and subsoil belonged to the Congolese state. It is that law, which from its implementation in 1973, allowed the nationalization of the land. Land, soil and subsoil resources were transferred to the state and foreigners had no access to the mining areas. The Bakajika Law sought to correct a major injustice, which was that during the Belgian colonial occupation, a significant portion of the best indigenous land was given to settlers. With the fall of Mobutu’s military dictatorship in 1997, the great achievement of the Bakajika Law was abandoned, and with it “the provisions that could have protected the land from being sold off were overturned. ” (Colette Braeckman: Der Katanga-Boom. Kupfer und Kobalt locken Investoren in den Süden des Kongo. In: Afrika. Stolz & Vorurteile, Edition Le Monde diplomatique 5/2009, 69, as following quotations) Especially with Joseph Kabila’s assumption of power in January 2001, the liberalization proposals of international financial institutions were given free rein. By 2008, 33.5 percent of Congolese territory had been ceded to mining companies.
The basis for this scandal is the 2003 mining law, described as liberal, “which was practically dictated by the World Bank. It forms the basis for the sell-off of the country’s mineral resources. In this, the World Bank knew with whom it was dealing: with rulers who were not legitimized by elections and who, in order to keep themselves at the head of a weak, unorganized state, would be easily corruptible. ” This mining law was primarily about attracting investors: “To do this, a stability clause was built in, with numerous tax breaks. It was supposed to guarantee investors that the legal framework would not change in the following ten years. Later, commodity prices picked up, and the first who dared to take entrepreneurial risks in Congo were the winners „, said Eric Monga of the Congolese Business Federation, describing the circumstances under which the law came into being. The companies Eric Monga is talking about include giants like Anvil Mining, BHP Billiton, Freeport McMoRan and Phelps Dodge, which control or at least influence the commodities markets. They knew it was a matter of time before a positive business cycle picked up. A commission of the Congolese government itself reviewed contracts that had come into existence during that period, and not one of those contracts was found to be in compliance with the law and worth preserving. It recommended that most of the contracts must be revised and the rest simply cancelled, because the review revealed a devastating reality: “Throughout many contracts, there is a systematic undervaluation of the shares contributed by Gécamines – i.e. the estimated value of the extractable raw materials and existing production facilities – while at the same time overvaluing the investments made by the partners. In addition, the state loses valuable revenue through the tax benefits granted to companies. Some of these are tax exemptions for thirty years. Other companies had acquired mining concessions for mere speculative purposes and resold them on the stock market without even having begun mining ore. “A central role in this phase of the history of the mining sector in Congo is played by the respective Albert Yuma. He was at that time already the overpowering president of Gécamines, because he was the extension arm of the autocratic ruling then president of Congo J. Kabila, who was involved in many corruption cases during his 18 years of office. As such, he was the angle and fulcrum of the contracts described above, which form the basis for the plunder of Congo’s natural resources, eliminating social, democratic and environmental standards and jeopardizing Gécamines’ substantial contributions to education, health, sports and basic infrastructure development.
In his interview with Alain Foca, Yuma argues that international financial institutions played a major role in the privatization of the Gécamines. He states with regret that Congo’s mineral resources now belong to foreign companies because the Congolese state was forced by its multilateral and bilateral partners to sell most of its mining assets, particularly those of Gécamines, to foreign companies. The International Monetary Fund and the World Bank in particular associated their lethal medicine with the hope that foreign companies would generate economic growth in the country by injecting their capital. And Yuma believed them. Instead, Congo was literally robbed, just as colonialists did when a Congo state run by supposed “natives” did not yet exist. The great shock of the interview comes when Albert Yuma quantifies the looting: foreign companies, the majority of which control the former mining assets of Gécamines, with a production that today exceeds one million tons per year, do not even cover 17% of the Congolese state budget, while Gécamines, when it was the sole shareholder of the mining sector, produced almost 500,000 tons per year and covered more than 70% of the state’s total budgetary needs, Albert Yuma said with a sad look.
Even more shocking is the solution that Yuma proposes in the face of this disaster: the creation of an “Entreprise générale du cobalt”, a company whose objective is to exercise a purchasing monopoly over all artisanal production of Congolese cobalt (30%), its processing and its marketing. In other words, the contracts with the foreign companies remain untouched despite their obvious injustice, the state generates a bit more resources from the mining sector by better controlling the artisanal producers. The logical consequence of his own analysis would have been to cancel all existing contracts sooner rather than later. Does this fear of the big multinationals have anything to do with his assessment of the actual damage that the multinationals would inflict on Congo if they were deprived of power, or rather with his own entanglement not only at the level of the political option, which he himself describes as false, but also an entanglement in fraud and bribery? The fact is, in many cases bribes flow in Congo instead of taxes and Yuma is at the center of this sick system that systematically sacrifices the interests of the general public.
An African experience. Just replace Yuma with Zuma
The contracts described above are not unique to Congo, but are common to almost all resource-rich countries on the African continent, with a few exceptions. The best known of these exceptions is with some limitations Botswana, where it has been possible for the state to retain a 50% share in the diamond mines. In addition, there is the revenue from taxing the share of foreign companies that bring in know-how and capital. Another exception that has caused discussion in recent years is Tanzania, where the late President John Pombe Magufuli succeeded in enforcing a 16% state share in mining companies, in addition to consistent taxation of the mining sector. This is not particularly high, but at least represents a good start compared to countries whose resources are almost exclusively controlled by foreign corporations. In Africa, the share of foreign companies in the production of mineral and energy resources is very high compared to other continents. From oil, gold, diamonds, bauxite to uranium and platinum, in view of all the resources, scandalous stories are heard in different parts of the continent about negotiation processes in which the countries of the continent have turned former state-owned companies into minority shareholders in sites that they used to control absolutely. As a result, they have virtually no say or influence over the foreign companies that now control the majority of shares in their mines and oil fields. If the mines and oil fields no longer belong to the state, it can only ensure that a little of the natural blessing remains in the country through consistent taxation and redistribution of the profits, for example through good salaries for the workers, provided the sector is labor-intensive, which is not always the case in mining.
In many regions of the continent it is unfortunately the case that foreign companies often enjoy tax exemption for several years or pay only few taxes. The local workers are poorly paid and therefore live in poverty, without access to running water, electricity, water, proper sanitation and sewage systems. This was the case in many settlements in and around Marikana in South Africa in 2012, and is still the case today.
In order to be able to set taxes correctly, it would be important for African governments to know, through their specialized agencies, how much the companies produce. In some African countries, the governments do not even know how much the companies produce and what content, for example, of copper or cobalt their ores have. Such a case is reported in Congo-Brazzaville . The former head of state, Pascal Lissouba, admitted that his country did not even know how much oil the French company Elf (now Total) was producing in Congolese waters. In the 1990s, the inspectorate in charge of control at the oil ministry did not have ships or helicopters to visit the production sites. Elf had some, and when on one occasion the authorities asked for a lift to be able to inspect the plant, Elf claimed that all the ships were inoperable that day, and that was that. Thus, the government had to rely on figures for production volumes and corresponding taxes, which were provided by Elf alone. Whether the situation in Congo-Brazzaville has changed is difficult to say. But similar stories are heard in many other African countries. They affect many countries where national elites have no interest in controlling the activities of large companies especially in the mining sector. Companies are actually “controlling” themselves and they do so as it suits their interests. In countries where, for example, taxes are profit-based, it is heard that many mining corporations pay hardly any taxes for several years because of their supposedly high investments and the negative global economy. There is usually no control of such figures. This applies not only to poorer countries like Niger or Malawi, but also to those with developed administrative capacities like South Africa or Nigeria. It is not everywhere a question of capacity and expertise, but above all a question of political will, which leads one to ask what is wrong with our elites?
What is wrong with our elites?
Many African countries control only a fraction, if any, of the wealth of the underground. The rest is in the hands of large multinational mining companies that make large profits. They are supported by the industrialized countries where they do the processing, create quality jobs and pay slightly more taxes, and are protected by institutions that are multilateral in name. They are so powerful that they have nothing to fear when they pay local workers poorly, pollute livelihoods such as water, forests, and soils through their activities, even when they have been proven to cause respiratory diseases such as tuberculosis and silicosis.
When conflicts escalate between, for example, the labor force and companies, companies are virtually certain that the state will stand by their side with its security apparatus. This was the case in Marikana in 2012. Corporations do nothing but continue the essence of colonization: harnessing the resources of colonies, including their people. The cooperation of post-colonial elites gives this exploitation the legitimity of a national strategy. The companies can avoid any criticism, emphasize their conformity to the law, and dump all the blame on national elites, which they control any time. Thus, the old exploitation continues without the main profiteers always having to appear, because national elites hold all the symbols of political power, while economic decisions continue to be dictated by foreign beneficiaries. This is what Kwameh Nkrumah subsumed under the term neocolonialism. And that African post-colonial elites go along with it and do their part to stabilize exploitation was wonderfully predicted by Franz Fanon (Frantz Fanon: The Wretched of the Earth: Chapter 3: The Pitfalls of National Consciousness. 1961/1965). The post-colonial elites go along with it for many reasons: some just want to be rich and enjoy the western way of life to the fullest. They are those elites who do not have in mind to make the colonial system disappear, but to replace the “white man” and enjoy its benefits. Other elites believe in the good will and technocracy of the West and its “multilateral institutions” when they rant about helping Africa. When they then implement concepts dictated by the West, such as “privatization of the mines“, it is also because they themselves believe, through their socialization, that such concepts will bring the promised fruits. Others act out of fear: They have perceived what happened in Africa’s history to those who did not want to conform and preached alternatives. Not only were they unable to come to power or hold on to power only briefly, but they were brutally eliminated. And because power is central to these elites and is exercised in such a way as to deplore human rights and personal enrichment at the expense of the majority, selling off national resources is the only way to guarantee unlimited or at least “profitable” terms in office. A final group acts from a somewhat deeper motive: it has so internalized the superiority of, say, “Europeans” and „Foreigners” that good relations with European foreign elites have become the main criterion of action for them. For the preservation of these relations, they accept to sacrifice the long-term interests of their countries. Admittedly, these motives are not mutually exclusive; they can be observed in combination in different constellations. They testify to contexts that have not managed to overcome a terrible past, to develop and enforce concepts of themselves against which all external relations can be measured. The elites operating within them are in conflict with the deepest values of their communities.
Africa needs new political forces and new mass movements capable of bringing political, economic and, above all, epistemological decolonization to an end. Only in this way can the continent recover its material, spiritual and intellectual resources and put them at the service of its own transformation processes. We owe it to the victims of the Marikana massacre and to all victims of economic exploitation on the continent not to wait much longer with the reappropriation. Many of african elites are sick, this manifests itself in their treatment of the legacy of colonialism and african people can no longer accept being ruled by sick elites. As for the West and other foreign powers, let’s not be fooled: they are doing well, they are looking out for their interests, even if they occasionally pass laws that make it seem like they have our interests in mind.