March 21 (Bloomberg) -- The Democratic Republic of Congo will increase its stakes in new mining projects and raise taxes when it revises the 10-year-old industry code this year in an attempt to boost revenue, Mines Minister Martin Kabwelulu said.
There will be a transitional period before the new code is implemented, he told reporters today in Kinshasa, the capital. The code currently requires miners to cede 5 percent of a project to the state at the point of exploitation. Kabwelulu didn’t say what level the percentage would increase to.
“Current mining codes in Africa do not give countries sufficient revenue to make the investments and savings they need to make,” Kabwelulu said. Congo’s government brought in about $100 million in revenue from mining last year, he said.
Congo is Africa’s second-largest producer of copper, the continent’s biggest producer of tin ore, and produces about half the world’s cobalt. It also has deposits of gold and diamonds. Companies including Freeport McMoRan Copper & Gold Inc., Glencore International Plc and Eurasian Natural Resources Corp. have copper and cobalt assets in the Central African nation. Randgold Resources Ltd. and AngloGold Ashanti Ltd. are developing gold mines there.
Any revisions to the code will need to be approved by parliament, Kabwelulu said.
‘Little by Little’
“The changes will be introduced little by little” for miners already operating in the country, he said. “We know we can’t just shock the sector.”
The revised code will require miners to divulge the identity of their investors to increase transparency, Kabwelulu said. It will probably include procedures for an open tender process for new mining concessions, he said.
Mining companies will also be required to invest in the “modernization” of the regions where they operate, he said. The United Nations last year ranked Congo bottom of its Human Development Index, which measures indicators including education and income human development.
“African nations are in a position of strength,” Kabwelulu said. “The demand of the world is enormous and the need for metals is enormous,” he said.
To contact the reporter on this story: Michael J. Kavanagh in Kinshasa at email@example.com.
To contact the editor responsible for this story: Paul Richardson at firstname.lastname@example.org.