Cologne-based business lawyer Christophe Kabambe accompanied a German business delegation on an exploratory visit to the Congolese city of Lubumbashi. He reports on the revelations of the journey.
A delegation of German businessmen recently visited the city of Lubumbashi in the deep south of the Democratic Republic of Congo (DRC) in June. Lubumbashi, with an estimated population of more than two million, is the second largest city in the DRC and the regional capital of Haut Katanga province, the economic heart of the vast, mineral-rich country.
The German Federal Ministry for Development and Economic Co-operation had discovered a lack of knowledge about this very dynamic market in the German business community and therefore tasked Cologne-based trAIDe GmbH, founded by Congolese-German Philip Okito Pütz, with organising a market exploration trip for German business people to Katanga.
Representatives of 20 German companies, mostly builders of mining equipment, took part in the five-day voyage. Meetings of the German delegation with the Governor of Katanga Province and the city’s Chapter of the Congolese Chamber of Commerce became the talk of the town in Lubumbashi and were featured on radio and television.
The trip was timed to coincide with DRC Mining Week, which was held in Lubumbashi on 8-9 June. The event is an annual trade fair of the major mining companies that are active in the Katanga region such as Ivanhoe Mines, Tiger Resources and Tenke Fungurume, as well as suppliers of trucks, machines and services for the mining sector.
More than 1,500 professionals from the mining sector and an additional 1,000 visitors from other trades attended the fair where some 100 companies put their products and services on display. DRC Mining Week took place against the backdrop of a price slump in the commodities market, specifically in copper, the lifeblood of Katanga, and the resulting withdrawal of several big players from the market.
However, the participants were optimistic that the current downturn, like so many before it, is part of a cycle that must sooner or later head upwards again. Outlooks were also optimistic for cobalt, of which Katanga holds roughly 70 per cent of the world’s known reserves. Demand for cobalt is expected to increase dramatically as it is used, among other things, for energy storage in the rapidly expanding markets for batteries used in vehicles and solar power units.
It was also refreshing to hear from several high-ranking Congolese officials that billion-dollar investments in the mining sector often reap great headlines, but only few jobs. In fact, with every mine that is upgraded to state-of-the-art, thousands of jobs for young people are lost and the former miners released into the streets to fend for themselves.
Wariness about the blessings of a globalised commodities market was clearly visible. It remains to be seen whether the current review of the regulations of the mining sector in the DRC will at last be amended to benefit not only a select few but the majority of the Congolese population in a meaningful way.
Congo, due to a constant stream of unfavourable press, is perceived as a war-torn basket case by most Germans and even among German companies with activities in all corners of the world. The trip aimed and successfully managed to give the participants a somewhat more realistic view of a country that has its share of challenges, but which also offers huge opportunities for investment and for the future of its population.