Congo Raises Tax on Copper, Cobalt Concentrates by Two-Thirds
The Democratic Republic of Congo’s Katanga province raised its tax on copper and cobalt concentrates to $100 per metric ton from $60 as the country prepares to ban their export at the end of this year.
“We needed a way to discourage companies from continuing to export concentrates, so we raised the tax,” Valery Mukasa, chief of staff for Mines Minster Martin Kabwelulu, said yesterday in an interview in Kinshasa, the capital.
The Central African nation is trying force mining companies to increase the value of their exports by fully processing minerals within the country’s borders, Mukasa said.
Congo was the world’s eighth-largest producer of copper and the biggest producer of cobalt last year, according to the U.S. Geological Survey. At least 13 companies exported concentrates of copper, cobalt, or a copper-cobalt concentrate last year, according to Katangan provincial Mines Ministry statistics.
Glencore Xstrata Plc (GLEN), Freeport-McMoRan Copper & Gold Inc. (FCX) and Eurasian Natural Resources Corp. (ENRC) were the country’s biggest miners in 2012, responsible for 58 percent of copper production and 56 percent of cobalt output, according to Mines Ministry statistics.
Katangan Governor Moise Katumbi first implemented the $60 per ton tax in 2010 after a previous attempt by the Mines Ministry to ban the export of concentrated minerals. Katanga will continue to collect the tax directly, Mukasa said. He was uncertain whether revenue would be shared with the national government.
Congo is revising its mining code, which currently allows for the export of concentrated minerals.
Miners and Congo’s main business association, la Federation des Enterprises du Congo, have opposed the ban, saying the country does not generate enough electricity to process all its mineral production within its borders. Power shortages have forced some miners to install generators or buy electricity from neighboring Zambia to run their processing plants.
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