Audit says that Congo mining companies underreported revenues of $16.8 Billion.
A state audit revealed that mining companies in the Democratic Republic of Congo failed to report $16,8 billion between 2018 and 2023. This could have resulted in a reduction of funds for both the government and the local communities.
According to the 2018 Congo mining code, companies must contribute 0.3% annual revenue towards community development funds, which typically support schools and clinics, as well as water systems.
The June audit of the Court of Auditors of the country, which was seen on October 5, but previously not reported, revealed that companies had declared $81.4 billion for the development fund, but reported tax authorities $98.2 million.
A REPORT SHOWS $50 MILLION IN DEVELOPMENT FUNDING WAS MISPLENDED.
The Congo is one of the poorest countries in the world. It's a major cobalt and a copper producer, both essential for battery production.
According to the report, this discrepancy led to a loss of $50.4 million in contributions for development funds.
It said that CMOC TFM, Glencore Kamoto Copper, Ivanhoe Kamoa-Kakula Mine, SICOMINES Metakol, Eurasian Resources Group, Ruashi Mining and SICOMINES collectively reported $10 billion less than what they actually earned.
The second largest cobalt exporter Glencore stated that its subsidiary Kamoto Copper has fully met its obligations as per the mining code. They added that the discrepancy was due to different interpretations on when the law came into effect.
The local development agency and auditors confirmed that the 0.3% community levied was calculated based on revenues for half-years.
CMOC - the world's largest cobalt exporter - did not respond when asked for comment.
In response to questions regarding the findings of the report, Attorney General Jean Chris Mubanga Musuyu said: "Practically 70% of the companies didn't respect this regulation... It's an immense loss of earnings for Congolese State."
The Court of Auditors recommends that the government should suspend non-compliant companies and pursue prosecutions. Mandatory revenue audits are also recommended, as is stricter oversight.
NGOS WANT MINES TO BOOST INCOMES
The average annual income of Congolese people, who also have vast reserves in lithium, uranium, and other minerals is $580.
The conflict with M23 rebels, backed by Rwanda, in the mineral rich east of the country has claimed thousands of lives and forced hundreds to flee.
Civil society groups have pushed for a 0.3% tax to bypass the central bureaucracy and channel funds directly into mining communities to promote local development.
The idea was to turn mining into a means of upliftment, and not just extraction," explained Emmanuel Umpula Nkumba from Lubumbashi's nonprofit AFREWATCH.
If this is managed well, it will improve the lives of people on the ground." Maxwell Akalaare Adombila (Writing) Clara Denina Rob Corey-Boulet Mark Potter
(source: Reuters)