Diamond production falls – Congo Independent

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According to the Central Bank of Congo, production in 2023 has fallen from 18.891 million carats in 2019 to 8.306 million carats. This is due to the difficulties of MIBA (Bakwanga Mining) and SACIM. The same downward trend has been seen in official exports of artisanal diamonds due to massive customs fraud. Today, there are rumors that the global recovery plan will require nearly $400 million.

Gaston Mutamba Lukusa

Official diamond production and exports from the Democratic Republic of Congo have fallen sharply in recent years, even though the country has been the world’s leading industrial diamond producer for many years. According to the Central Bank of Congo, diamond production fell by 29.48% from 18.891 million carats in 2019 to 8.306 million carats in 2023, affected by the difficulties of MIBA (Bakwanga Mining) and SACIM (Anhui Congo Mining Investment Company). The official exports of artisanal diamonds have also shown the same downward trend due to large-scale customs fraud.

Diamond production is carried out by MIBA, SACIM and KA-BE, the latter being a marginal producer. MIBA, 80% owned by the Congolese state, was once a source of national pride, but is now a shadow of itself. She is often in a state of stagnation. It supports nearly 40,000 people, employees and families, not counting suppliers and subcontractors. Its concession area exceeds 78,000 square kilometers. In 2000, the authorities transferred part of the concession (719 square kilometers) to the Congolese company SENGAMINES. The organization ceased activities in March 2005 due to the inexperience and incompetence of its leaders, energy problems and the isolation of the region. Today, MIBA’s concession is being eaten away by uncontrolled subdivision and construction. In addition, the facilities are often invaded by illegal operators. Production tools are outdated. The remoteness of the area means that inputs must be brought in by dilapidated railways or planes, which increases costs. It can be seen that to rehabilitate the society, a lot of money is needed, which the government does not have.

Recovery plans have been in place since 2006. They have failed to get the company back on track. Today we are talking about a global recovery plan that requires nearly $400 million. The state must stop subsidizing MIBA. Besides being very expensive, it is a waste of money. It is not normal for a diamond mine with a large deposit to go bankrupt. It indicates serious financial imbalances and mismanagement. The solution consists in transferring part of the capital to private shareholders by way of tender. The IGF (General Inspector of Finance) in its February 2020 report deplored the serious arrears of wages and retirement benefits, the theft of gemstones and the interference of the Chairman of the Board (PCA) in the day-to-day affairs of management. This gave rise to a conflict between the PCA Jean-Charles Okoto, who has a bad reputation, and the general manager André Kabanda Kana. The state should regulate managers who are not consistent with the management of a seriously troubled enterprise.

SACIM replaced SENGAMINES after the Congolese government signed a contract with a Chinese company called Anhui Foreign Economic Construction Group (AFECC), which holds 50% of the capital. SACIM’s business plan foresaw production of 600,000 carats in 2013 and 6 million carats in 2016. The company achieved these targets. But it is often criticized for the opacity of its activities. SACIM suspended production for part of 2023 due to problems with tax authorities, fuel shortages and workers’ strikes. This led to a temporary halt in mining.