Regulatory uncertainty is one of the key concerns highlighted at this year’s Mining Indaba, and while Mines Minister Mosebenzi Zwane, says he understands the issue but was unable to give a clear plan going forward. The sector is currently experience its longest downturn with a commodity rout unseen before, while cost and labour pressures are putting the squeeze on. All this putting a dampener on possible investment. Head north and there may be a lesson for South Africa to heed. Congolese mines minister Martin Kabwelulu says the country has dropped plans to change its mining code following opposition from the companies. As the saying goes, sow what you reap. – Stuart Lowman
By Franz Wild
(Bloomberg) — The Democratic Republic of Congo, the world’s largest source of cobalt and Africa’s biggest copper producer, dropped plans to change its mining code after opposition from mining companies, Mines Minister Martin Kabwelulu said.
“The mining code which is currently in place will stay in place,” Kabwelulu said at a speech to investors in Cape Town on Wednesday. “You don’t have to think about modifying your business plan. Those who are thinking of investing can do so based on this code.”
Congo began reviewing the 2002 mining code in 2014. Revised laws approved by the government in March included increases in profit tax to 35 percent from 30 percent, raising the government’s free share of new mining projects to 10 percent from 5 percent and royalties on copper and cobalt revenue to 3.5 percent from 2 percent.
Read also:Â Good news for Glencore? Congo delays ban on certain mineral exports until 2017
The Chamber of Mines at the Federation des Entreprises du Congo, a business lobby group, had opposed revisions to the code because of the potential negative impact it could have on investment in mining. Randgold Resources Ltd. Chief Executive Officer Mark Bristow said in October the proposed revisions to the code risked destroying the industry.
Randgold mines gold in the Congo in a joint venture with Johannesburg-based AngloGold Ashanti Ltd., while companies including Baar, Switzerland-based Glencore Plc and Phoenix, Arizona-based Freeport McMoRan Inc. extract copper from the central African nation.
