Billion Barter Deal
Republic of Congo is trading with a massive state-owned firm based
in Beijing, the China Railway Engineering Corporation (CREC).
They�re planning a new road which will be the first endeavor of the
biggest single deal China�s ever done in Africa, worth $9 billion.
Due to be
signed in Beijing shortly, it gives DR Congo $6 billion of
desperately needed infrastructure � about 2,400 miles of road, 2,000
miles of railway, 32 hospitals, 145 health centers, and two
China gets a slice of DR Congo�s precious natural resources to feed
its booming industries � 10 million tons of copper and 400,000 tons
of cobalt. It�s a barter deal, what the Chinese side loves to call
�win-win.� Not aid with strings attached, like Western powers have
given DR Congo over the years, but pure business.
kleptocratic dictatorship and brutal civil war have brought DR Congo
to its knees. Most of its infrastructure barely functions. �We�ve
been mining for two centuries but people only see minerals going
out,� says deputy Mining Minister Victor Kasongo. �People talk about
roads, schools, water; yet they hardly see anything from the huge
ambassador to DR Congo, Wu Zexian, is equally frank about his
country's agenda: �China needs many things. In this world China
cannot live closed off which is why we have adopted a politics of
openness towards the outside world. We must come to a co-operation
that benefits everyone.�
The deal was
clinched by finding a mine in Kolwezi that had enough proven
reserves to persuade the Chinese that it was financially safe for
them to begin disbursing about $3 billion, right away.
state-owned Exim Bank, which is financing this deal and many others
in Africa, is taking on a level of risk that few Western banks would
consider. It�ll take about three years, and another $3 billion or so
of investment, before the disused mine (formerly owned by the
Belgian Forrest Group) is up and running.
begins, the Chinese companies signing the deal, CREC and Sinohydro,
will disburse a final $3 billion on roads, railways and hospitals.
The idea is
that China will recoup its total investment within 10 years.
joint venture (one third Congolese, two-thirds Chinese) continues to
exploit the mine. And yet, despite China�s pledge of openness, the
deal has still not been published...to the fury of human rights