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Article

28 Feb 2020

Author:
Andy Home, Reuters

DRC: Government creates Gécamines subsidiary with monopoly powers to purchase artisanal cobalt

"Congo's move to control artisanal cobalt is double-edged: Andy Home", 10 February 2020.

The government of the Democratic Republic of Congo has announced ambitious plans to take control of the country’s...artisanal cobalt sector. A new state company, Entreprise Generale du Cobalt (EGC), has been given monopoly powers to purchase and market cobalt from the informal sector. The move is being hailed by the government as a way to clean up a sector that is tarnished with a reputation for child labour, lax safety and illegal activity...The human cost of mining in the Congo, which accounts for more than 60% of global cobalt production, is one of the reasons companies such as Tesla are actively trying to engineer the metal out of their battery supply chain...

“We are going to eliminate child labour, we are going to eliminate labour by pregnant women and we are going to eliminate fraud in this sector so that the cobalt (...) will be responsible cobalt,” according to Albert Yuma, chairman of state mining company Gecamines, which will oversee the EGC...The problems associated with artisanal cobalt mining in the Congo are generating an aggressive industry response with consumers trying to eliminate or at least drastically reduce the metal’s usage in lithium-ion batteries. That in turn acts as a major hindrance to building out a sustainable and responsible cobalt supply chain...

Integrating artisanal production into the official sector should boost the government’s mineral take and put more money in the pockets of the miners, who receive a fraction of the cobalt price...If the new EGC is successful in its attempt to take control of artisanal production, which is still a big “if”, it will assume the mantle of global swing producer...