A very interesting assessment of the UN by rwandan president over the report accusing his country of supporting Congolese rebels: "Why don't they say anything about what the 1 billion-dollar-a-year mission is doing in Congo: raping, selling arms to genocidaires and looting". And then: "This U.N. thing is our thing but it is our very bad thing," said Kagame, calling the New York-based institution a "curse". The assessment is reported by Reuters, one of the very media corporations I talked about yesterday:
Economic crisis catching up with Joseph Kabila and those who are "milking" the country through him
- Reuters: Congo slashes copper, cobalt goals as demand drops
KINSHASA, 16 December 2008 (Reuters) —Congo has slashed copper output targets for the next three months by 30 to 40 percent and halved projected 2009 cobalt production due to factory closures and waning demand, the deputy mines minister said.
Plummeting prices have hit Democratic Republic of Congo's copper and cobalt belt hard as financing has dried up, forcing companies to delay development or suspend operations in what had been one of the world's most promising new exploration areas.
"Compared with what we expected without the crisis, we are predicting a 30 to 40 percent maximum drop in copper production for the next three months," Deputy Mines Minister Victor Kasongo told Reuters in an interview late on Monday.
Following 2006 polls meant to draw a line under decades of kleptocratic dictatorship and armed conflict, investors spurred by high world market prices flocked to Congo 's vast and largely unexploited concessions.
However, 45 of 75 copper and cobalt treatment facilities have shut down in Congo 's southern Katanga Province mining heartland, which has been broadly spared the violence continuing in eastern Congo despite the official end of a 1998-2003 war.
Output forecasts for 2009, which had included major projects meant to come on-line during the year, have had to be revised.
Congo's mines ministry now expects copper exports of 365,000 tonnes, down from a pre-crash prediction of 410,000 tonnes, but still up from 2008's projected 289,169 tonnes due to expansions that have already come on-stream.
"It's still a lot, but it could be worse," Kasongo said. "It's all the small shops in Asia that have subsidiaries here that are closing. Those 30 operators that are still producing should be able to export more," he said.
Cobalt exports are due to fare even worse with forecast 2009 output more than halved to 32,000 tonnes from a previous 65,000 tonne forecast and from projected 2008 output of 42,449 tonnes.
"Cobalt is mainly used for electronics, and electronics is now a problem. We cannot predict. For now it's down considerably. The biggest producers are at a standstill," Kasongo said.
RESCUE EFFORTS
Benchmark world copper prices on the London Metal Exchange have fallen by around 65 percent since reaching a record high of almost $9,000 per tonne in July. Three-month copper was down 0.81 percent at $3,075 a tonne at 1118 GMT on Tuesday.
Cobalt cathode crashed to $12/lb last week from a March high of $52.50, and closed at $16.50/lb on Monday.
Firms like Katanga Mining, Anvil Mining and Central African Mining and Exploration Company have suspended some Congo activities as costs rise and prices fall.
In a move to limit the damage done by falling prices and slacking demand from Asian markets, Congo said last week it would reduce mineral export taxes and royalties.
The measures, intended to stimulate higher output from those companies still functioning, are renewable every three months.
Demand is expected to rebound eventually but experts predict a lengthy economic slowdown in Asia may well mean more closures.
"Demand will pick up, but the question is when," Federation of Congolese Businesses Vice-President Michel Losembe said.
"Those companies with cash and those that are bullish will keep producing at high levels. Those that did not secure financing before the crash and cannot move because they now have nothing to export will shut down," Losembe said.
Kasongo said Katanga provincial government predictions of 300,000 job losses were overblown, but said workers would be hit.
"We didn't have 300,000 employees in Katanga . But we have 45 out of 75 furnaces that have shut down. Most that shut down were very artisanal and not very well structured," he said.
"One furnace employs 80 to 100 people. But they depend on the diggers that bring the minerals to the furnace."
Some more:
- Katanga in distress : Speculation over the poor state of Katanga Mining's (KAT-T) finances is over.
http://www.northern%20miner.com/%20issues/ISArticle%20.asp?id=93588&issue=12152008&ref=rss - Daily News Monday, December 15, 2008The company announced in stark terms that it needs more funding on an "urgent basis" to sustain itself.The London-based company said it lacks the funds to continue operations beyond the short term and is asking shareholders for permission to drastically bolster the amount of shares it would have available to raise funds.Katanga wants to up its amount of authorized shares to 5 billion with a notional value of 10¢ per share, from its current position of 300 million with a notional value of 5¢ per share.The company currently has 206 million common shares issued and outstanding. By bolstering the size of its authorized shares it could conceivable raise funds by issuing large amounts of convertible debt.Shareholders will vote on the proposal on January 12 of next year in Toronto .Clear distress signals were sent by the company with regard to its finances back in September when it admitted it lacked the cash required to ramp up its key Kamoto copper and cobalt mine to self-sustaining levels.While it has implemented cost cutting measure aimed at capital expenditures and its workforce such cuts haven't been enough to compensate for the drastic fall in commodity prices and subsequent thinning of cash flows.The effect of lower prices was in sharp evidence just a few weeks ago when Katanga announced that it was temporarily halting cobalt production at a key cobalt mine and processing plant due to lower prices.To get through the present financial straits, the company says it is considering both equity and or a convertible debt financing.If it does go the convertible debt route, participating shareholders would be able to increase their equity stake without prior shareholder approval.Katanga will have a new chief financial officer Oversee the new financial arrangements. The company announced that Nicholas Brodie will immediately take over the post from Stephen Jones who resigned on December 9th.Brodie has served as Katanga 's finance director since 2006.In Toronto on Dec. 15 Katanga shares were off 15% or 6¢ to 32.5¢ on roughly 1.5 million shares traded. Its shares had closed at a high of $26.20 on July 13 of last year.
And a bit more
- DRC faces economic crisis
AFP: Kinshasa, 16 December 2008 (AFP)— Unlike the glaring battles that rage in the eastern Democratic Republic of Congo, the country's economic crisis is more camouflaged but potentially just as potent.
On Friday the Central Bank of Congo (BCC) said economic growth had fallen by 2.7% between July and October and lowered its annual growth forecast from 11% earlier this year to 5.9%.
DR Congo is home to 34% of the world's cobalt reserves - essential for mobile phones - and 10 % of the world's copper supplies. It is also rich in tin, gold, diamonds and uranian.
But since copper has lost 75% of its value since July, diamonds 40% , while cobalt has plummeted to a fifth of its price.
The collapse in commodity prices risks "making our economy more vulnerable than beforehand," President Joseph Kabila told parliament on Saturday.
Miners contracts
Added to this, there are fears over his government's plans to renegotiate miners' contracts allocated at the start of the 2000s..
Major mining companies operating in DR Congo have seen profits and their share prices collapse over the past year and drastically cut production.
Last week Australian company Anvil Mining said it was suspending copper production and shutting its Dikulushi mine in southeast Congo due to low world demand. South African diamond giant De Beers also plans to stop exploration in the country.
Workers, traders and merchants in the mining sector face a stark future.
In the largest mining region, Katanga in the southeast of the country, there are already "200 000 extra unemployed people and the figure will rise to 300 000 or 350 000 by the end of the year," said Katanga province mining minister Barthelemy Mumba Gama.
"The mines are the engine of development and all the other occupations orbit around it," he said, adding that Katanga is grinding to a halt with its shops, restaurants and the airport all empty.
A similar fate confronts the diamond rich Kasai-Occidental province in central Congo where "production has fallen to a very low level," according to the president of the provincial assembly Francois Kabala.
Increased begging
"The consequences are visible to the naked eye," he said, adding that in the provincial capital, Mbuji Mayi , begging has increased and residents were starting to sell belongings on the street.
The export collapse has seen the amount of foreign currency entering the country shrink and caused the Congolese franc to lose 20% of its value against the dollar.
In spite of this, President Kabila urged people not to be "discouraged" .
His government has unveiled a draft budget for 2009 of more than $5bn (€3.7m) - a 40% increase on this year's budget - based on a growth rate of 9.0%.
But the government, already bogged down in an expensive battle against rebel leader Laurent Nkunda's in the east, may find it hard to fulfil the ambitious budget, which the opposition attacked as "unrealistic" .
"In two months, the Congolese state has run out of money to pay its civil servants," said a diplomatic source who did not want to be named.
He added that President Kabila faces "a catastrophe" as the country's financial crisis threatens "to cause an already fractious social situation to explode".
More than 75% of the country's population lives on less than a dollar a day and DR Congo ranks 167th out of 177 on the UN Human Development Report - the world wealth list.
And a nail on the coffin? En français
- La MIBA a fermé ses portes
(Kimp.)
C’est depuis plus d’une semaine que les activités de prospection et de production des diamants se sont totalement arrêtées à la Minière de Bakwanga (Miba). Il n’y a que l’administration qui essaie de donner un semblant de vie à une société qui n’est ce qu’elle est que lorsque ça bourdonne de ses gisements à ciel ouvert au centre de triage. Cette fois, il ne s’agit pas d’un arrêt de travail consécutif à une grève du personnel ou à une panne technique mais plutôt aux difficultés de trésorerie qui accablent ce géant minier à la suite des « efforts de guerre » à répétition de 1996 à ce jour et surtout du « hold up » opéré par la Sengamines sur ses pièces de joaillerie entre 1999 et 2003.
Alors qu’elle traîne un lourd passif financier et qu’elle ne tenait le coup que grâce à des opérations de préfinancement de ses campagnes de production par voie bancaire, notamment la BCDC et Rawbank, la Miba se trouve sans le sou, ses banquiers lui refusent de nouvelles avances de fonds, à cause de la non liquidation des dettes pendantes. Compte tenu du non remboursement des prêts bancaires à échéance due, les milieux financiers se méfient désormais d’une débitrice aux caisses sonnant souvent creux.
Une crise multiforme La menace de banqueroute qui frappe aux portes de la Miba relève de plusieurs origines. Il y a d’abord et avant tout le problème de l’obsolence de l’outil de travail. Suite à une gestion peu orthodoxe des revenus de vente du diamant depuis des décennies et à l’absence d’une politique de planification de renouvellement et de modernisation de ses équipements techniques, cette société d’économie mixte fonctionne aujourd’hui avec des machines de prospection et d’extraction ayant largement dépassé la limite d’âge.
En conséquence, la quantité de diamants produits n’a fait que baisser au fil des ans. On cite, en second lieu, les ponctions politiques dans les caisses de la Miba, pour répondre aux besoins urgents des « guerres » qui déchirent le pays depuis octobre 1996, date de la naissance de la rébellion de l’AFDL (Alliance des Forces Démocratiques pour la Libération du Congo). Voici plus de 12 ans que le cycle infernal des conflits armés continue, faisant du diamant le principal « nerf » de la guerre.
D’aucuns épinglent le partenariat avec Sengamines, une nébuleuse regroupant l’Etat congolais, des particuliers congolais et expatriés, notamment des Zimbabwéens et des Asiatiques du Groupe Oryx Mining, comme l’une des arnaques ayant hypothéqué les gisements de joaillerie les plus juteux de la Miba situés à Senga-Senga, dans le territoire de Miabi, et consacré son arrêt de mort. Il y a aussi le désengagement financier des Belges de Sibeka et des Sud-Africains de De Beers, il y a quelques années, qui s’était traduit par l’effritement du capital social et l’accroissement de la crise de confiance entre la Miba et les banquiers à l’intérieur comme à l’extérieur du pays.
On parle, ces dernières semaines de l’effondrement généralisé des cours des matières premières sur le marché mondial. D’où, forcément, le diamant ne pouvait pas échapper au couperet de la récession.
On faisait état, il y a peu, du carat du diamant qui se commercialisait en-déça de 15 dollars américains, soit moins de la moitié de son prix traditionnel. Le chaos financier Comme recettes mensuelles, l’on avançait, au mois d’octobre, le chiffre d’environ 1,5 millions dollars US, ce qui représentait moins de l’enveloppe salariale mensuelle évaluée autour de deux millions US. Or, la Miba devait à la fois faire face aux frais de fonctionnement, de maintenance sinon de renouvellement de l’outil de travail, de paiement des salaires et « colis » alimentaires, de remboursement des crédits bancaires, etc. Le fardeau était devenu trop lourd à porter pour une société qui a longtemps géré un déficit financier qui est allé crescendo.
La pléthore du personnel, surtout administratif, occasionnée par des recrutements liés à des mobiles politiques, n’était pas pour atténuer les ennuis financiers du colosse minier aux pieds d’argile. Mwana Africa : la bouée de sauvetage La firme sud-africaine Mwana Africa, dont le « Chairman » se trouve être un Congolais d’une famille bourgeoise bien connue de la place de Kinshasa, s’est annoncée comme future partenaire de la Miba. Le montage financier nécessaire à la relance de la production s’articulerait autour d’une enveloppe de 110 millions de dollars américains.
Mais Mwana Africa a posé, entre autres préalables, la restructuration du Conseil d’Administration, dans le sens de la collégialité effective dans la prise des décisions de management.
En clair, la vielle pratique de la concentration des pouvoirs entre les mains du Président Administrateur Délégué devrait être abandonnée.. Il est exigé aussi la claire traçabilité du diamant congolais, de l’extraction à la commercialisation des shipments sur les marchés internationaux, notamment ceux d’Anvers et de Tel Aviv.
Dans la même logique, un dégraissage drastique du personnel est attendu, sur base de la refonte totale de l’organigramme de la société, de manière à respecter la légendaire pyramide entre cadres et agents.
Mais, en attendant l’apport financier salvateur de Mwana Africa, la Miba a besoin, dans l’immédiat, d’un matelas financier du gouvernement congolais pour lui permettre de survivre jusqu’à la mise en route de son partenariat avec la firme précitée. Sans une opération urgente de perfusion financière gouvernementale, pense-t-on, Mwana Africa risque d’intervenir sur le tard, au moment tout serait déjà consommé.
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