June 17, 2020 / 12:24 PM / a month ago

UPDATE 1-Congo wants to help mining firms hit by coronavirus crisis

(Adds context on economy, impact of COVID-19)

JOHANNESBURG, June 17 (Reuters) - The Democratic Republic of Congo will try to offer financial support to mining companies which need help due to disruptions caused by the coronavirus crisis, the mines minister said on Wednesday.

Congo is Africa’s top producer of copper and the world’s main source of cobalt, accounting for two-thirds of global supplies of the metal used in smartphones and electric car batteries.

“If there are cases of force majeure, the state may be able to dip into its pockets to try and help mining companies,” Willy Kitobo Samsoni told a conference call.

Force majeure is a contractual clause invoked when factors outside the control of a mining company renders it unable to deliver mined metal to customers.

Mining accounts for 32% of Congo’s national output and the economy has been hard hit by the pandemic, which has slowed the global economy and demand for metals and other raw materials.

The central bank in April cut its 2020 economic growth forecast to -1.9%, and said extractive industry output was likely to drop 5.6% year on year. The central bank also said foreign exchange reserves had fallen to precarious levels.

Copper and cobalt mining firms in Congo have also faced logistical difficulties due to the pandemic, such as obtaining the supplies needed for extraction. But none of the biggest mining companies have declared force majeure so far.

Reporting by Helen Reid and Hereward Holland, Editing by Louise Heavens and Edmund Blair

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below