Few Benefits to the People of Congo From Mining Review
The Carter Center says that the people of the Congo will realize few benefits from the two-year mining review process with companies mining billions of dollars of gold, copper, cobalt, diamonds, and other minerals.
The Carter Center has drawn the following preliminary conclusions about the outcome of the process:
* Unwieldy: A major problem with the contracts was the vast array of divergent obligations that would be difficult to oversee and enforce even with a sophisticated regulatory apparatus, which the DRC lacks. That situation remains unchanged.
* Illusory: Most investors agreed to increased one-time, upfront payments; however, informed observers report that the payments are contingent and unlikely to be required under current economic conditions.
* Ephemeral: With the possible exception of conditions on debt financing for mining joint-ventures, there are no clear long-term benefits from the review. In the meantime, companies may still take advantage of weak provisions in many agreements to divert profits away from the investor company or to avoid paying taxes on real profits.
Read the entire statement from the Carter Center>>