In early January, China announced it would cancel about $ 28 million in loans to the DRC, due to be repaid by the end of 2020, and provide $ 17 million in other financial support to help the country. to overcome the health crisis caused by the covid-19 pandemic.
During a visit by Chinese Foreign Minister Wang Yi, the two countries also signed a memorandum of understanding on the Belt and Road Initiative cooperation, the DRC now becoming the 45th Chinese partner of the Belt and Road Initiative in Africa.
The initiative, also known as the “New Silk Road”, consists of a network of railways, pipelines, highways and ports that would stretch west through the former Soviet republics. and south to Pakistan, India and Southeast Asia.
“China’s decision to cancel the debts of the DRC and welcome the country as a new partner of the Belt and Road initiative is likely to strengthen cooperation between the two countries and encourage more Chinese miners, like China Molybdenum, to make new investments in the Congolese copper and cobalt industry, increasing their stake in local mines, ”Roskill’s report reads.
What should the West do?
The DRC hosts more than 51% of world cobalt reserves, according to 2019 data released by the US Geological Survey.
Roskill estimates that in 2020, the Central African country produced around 90kt Co in various intermediaries representing nearly 70% of the total production of cobalt raw materials at the World level.
Prior to the recent announcement, more than 40% of the DRC’s cobalt mining capacity was already controlled by Chinese companies following decades-long investments and developments in the country, several resource-versus-infrastructure deals. having been signed and implemented. since the 1990s.
“On the cobalt refining side, especially for the production of chemicals suitable for battery applications, China plays an even more dominant role, with its production of cobalt sulphate and oxides accounting for around 80% of total world production. in 2020, ”the report said. bed.
What should Western countries do to mitigate this supply risk in the years to come?
Locking in the raw material with long-term agreements is a good first step, says Roskill. They should also use alternative foods, like recycling, and develop resources elsewhere.