News (82)
In the Democratic Republic of Congo (DRC), Vodacom DRC, a mobile operator, will reinforce the digital skills of a million youths, with the support of Amazon Web Services (AWS). The training program, TechStart, was unveiled on November 13. Trainees will be equipped to meet the skills needs of companies or start their businesses, in line with the government’s ambition to leverage digital technologies to bolster the Congolese economy.
The mobile operator stressed that TechStart should help enhance its Vodaeduc platform, which “has already reached over a million people with its educational content”, thereby strengthening access to essential skills for the future.
Launched in 2017, this free platform provides access to educational resources in video format covering subjects such as math, science, IT, economics, and finance. It also includes content tailored to Congolese school curricula, catering to the learning needs of young people at all educational levels.
According to the World Bank, digital literacy will become a must for African workers over the next decade, even in sectors where they were previously non-essential. Covid-19 sped up the shift. In its 2021 report titled "Demand for Digital Skills in Sub-Saharan Africa: Key Findings from a Five-Country Study," the World Bank forecasts that by 2030, some level of digital skills will be necessary for 50-55% of jobs in Kenya, 35-45% in Côte d'Ivoire, Nigeria, and Rwanda, and 20-25% in Mozambique.
The World Bank also estimates that sub-Saharan Africa will create 230 million digital jobs by 2030. Most of these jobs will arise from the growth of digital services, requiring intermediate or advanced digital skills as well as basic digital and financial literacy accessible to all. In this context, Vodacom DRC's digital skills training initiative aligns well with similar efforts led by the Congolese government, particularly through the Ministry of Professional Training and partners like Huawei.
Muriel Edjo
The Democratic Republic of Congo (DRC) and the International Monetary Fund (IMF) have reached a preliminary agreement for a new program supported by the Extended Credit Facility (ECF) and the Resilience and Sustainability Facility (RSF). According to an IMF note issued on November 13, 2024, this new three-year program is backed by nearly $3 billion in financing, compared to the $2.5 billion initially requested by the government. It includes a financial package of $1.77 billion under the ECF, up from the planned $1.5 billion, and $1.1 billion under the RSF, up from $1 billion.
The new staff-level agreement still needs to be validated by the IMF Executive Board. While the Board is set to review the document in January 2025, this step should be a formality, as the Board of Directors rarely disavows its services.
The new program aims to improve governance and transparency, foster solid and inclusive growth by combating high living costs, and invest in infrastructure, priority social sectors, and agriculture. It also aims to diversify the economy, create jobs, and improve resilience in the face of climate change.
"The DRC is singularly well placed to play a central role in the global transition to a low-carbon economy, thanks to its vast forest and water resources, as well as its large reserves of 'green' minerals," notes the IMF.
Notwithstanding economic and inflationary pressures, the IMF believes economic growth should remain "resilient" above 5% during the new program. In comparison, inflation should return "to the level of the 7% target set by the Central Bank of Congo by 2026," says Calixte Ahokpossi, the Fund's mission chief for the country.
More funding incoming
For many years now, the DRC has been trying to secure international funding to boost its economy, in line with an ambition to overhaul the economy, through industrial development. The new IMF program should send a positive signal to investors seeking business opportunities in the country.
"This agreement marks a crucial step for the DRC, which could mobilize up to $800 million in budget support," said Congolese Finance Minister Doudou Fwamba during the November 12 meeting between President Félix Tshisekedi and the IMF mission chief.
This program follows the conclusion of a previous agreement made in 2021, which totaled $1.5 billion. Despite a challenging context marked by renewed conflict in the eastern region and the spread of monkeypox, Congolese authorities successfully passed all reviews of the previous program, which the Fund deemed satisfactory.
However, former Finance Minister Matata Ponyo said the IMF is complacent. In an October 12 article published in the scientific journal Congo Challenge, a piece co-authored with economist Jean-Paul K. Tsasa, the former Prime Minister argues that these reviews were completed while the country failed to meet several criteria and benchmarks. The authors also claim that some funds disbursed by the IMF were misappropriated and even accuse the Bretton Woods institution of complicity.
PM with Ecofin Agency
DRC Gold Trading SA officially launched a new branch in Kalemie, in the eastern part of the Democratic Republic of Congo (DRC) on November 18. This is the firm’s second branch; the first is located in South Kivu. In a press release, the company announced the new branch’s opening, indicating that it wants to "expand its activities of purchasing, marketing, and exporting gold from artisanal and small-scale mining in all the country's gold provinces."
Originally named Primera Gold DRC, the company became DRC Gold Trading on November 13 after transitioning to public control. The State and two public entities acquired the 55% stake previously held by the Emirati company Primera Group under undisclosed terms. The State now holds 55% of the shares, the Mining Fund for Future Generations has 30%, and Gécamines holds 15%.
Despite these changes, DRC Gold Trading said its vision is the same: "To make the DRC the world's largest exporter of artisanal and small-scale gold, through credible, conflict-free supply chains that benefit local communities, both directly and indirectly impacted."
According to the firm’s Managing Director Joseph Kazibaziba, it will be challenging to bring in all artisanally mined gold into the official circuit. "More than 50 tonnes are fraudulently exported to the east coast of Congo, worth more than $5 billion. You can understand that DRC Gold Trading is a strategic company of vital importance to the state," he told the press on November 13 during the ceremony marking the company's name change.
Défis de la compétitivité des prix
So far, DRC Gold Trading has exclusively been active in South Kivu. The firm collected and exported over 5.5 tonnes of gold in 2023, worth over $350 million. With its new branch, the company plans to collect and export more gold. However, this will depend on the competitiveness of the prices offered to mining cooperatives, traders, and approved buyers from whom it sources gold.
DRC Gold Trading plans to export at least 12 tonnes of gold this year–a far-fetched goal, based on data from Bloomberg, relayed by the Ecofin Agency. The figures show that the firm’s gold exports are falling. Since November 2023, shipments have fallen by 50%; a situation attributed to higher black market prices offered to artisanal miners and banking regulations that limit daily cash transactions.
Aware of the challenges ahead, Joseph M. Kazibaziba, who was in Kalemie on November 17, met with traders from Tanganyika province. However, no details were released about this working session, which aimed to discuss the challenges faced by players in the gold sector. Nevertheless, at the opening ceremony of the new branch, the Managing Director of DRC Gold Trading appealed to the people of Tanganyika, saying: "DRC Gold Trading SA relies enormously on your support to accomplish the missions entrusted to it by the President of the Republic. Its success is also that of your province, which will benefit through tax and parafiscal levies, not to mention the jobs generated." The official also assured his audience that the company has sufficient financial capacity to absorb all quantities of artisanal and small-scale gold produced throughout the country's east coast.
Pierre Mukoko
Congolese power utility, Société Nationale d'Electricité (SNEL), has missed out on a sales opportunity of about $4 billion in the mining sector over the past five years. Fabrice Lusinde, the utility’s managing director, disclosed the figure last week, during the 10th Makutano Forum, in Kinshasa. Lusinde spoke during a panel titled "Energy deficit: what if the miners brought the light?"
"Mining customers buy energy from SNEL for around $800 million. But alongside this, they import $200 million worth of electricity from southern Africa and, according to our calculations, they also spend between $500 and $600 million on petroleum products to run their thermal parks. In the end, we realize that the miners have spent around $4 billion over the last five years," he explained. SNEL's assets represent 63% of public holdings.
According to sources consulted by Bankable, from 2019 to 2023, the money spent to bridge the power deficit in the mining sector, on average every year, exceeded the SNEL's average annual turnover. For instance, from 2020 to 2022, the SNEL's average annual turnover was $762 million.
A concerned Lusinde said these monies could have been used to develop hydroelectricity for green energy in the mining sector. "Mining firms are struggling. They want to produce but know that launching a hydroelectric project could take six or seven years, or even five years in some cases. Diesel is expensive but with it, energy can be produced within six months," explained Jean-Pierre Nzuru, Technical Director of Ivanhoe Mines Energy.
Insufficient Investments
However, Nzuru pointed out that mining companies are financing several SNEL power plant rehabilitation projects. For example, he stressed that Ivanhoe Mines Energy has helped rehabilitate around 256 MW of installed capacity. "Combined, miners are rehabilitating a capacity of around 820 MW of installed power. Some projects have already been completed, while others are still in progress," he added.
Founded in 1970, the SNEL still relies on aging production and distribution infrastructure, which prevents it from reaching its installed production capacity. Between 2020 and 2022, the company announced investments of around $203 million, not enough to meet growing energy needs. With an economic profitability of just 3%, the SNEL struggles to borrow long-term on the local market, where banks demand interest rates of at least 13% on government bonds in foreign currency. Additionally, the international market remains inaccessible due to poor perceptions of the country and the company by foreign investors.
The DRC’s power sector has tremendous business. Indeed, besides the market share lost in the mining sector, several billion dollars are lost by electricity operators due to high distribution costs, which leads many households to rely on firewood for cooking. This gap between a clear opportunity and insufficient investment, particularly from public players, remains a challenge in Africa's second-largest country.
Georges Auréole Banda
Around $4 billion of charcoal or makala is bought on average every year in the Democratic Republic of Congo (DRC). "In the DRC, we spend around $6 billion a year on energy: $4 billion on makala, $1 billion on petroleum products, and $1.2 billion on electricity," said Fabrice Lusinde, Managing Director of of the country’s power utility Société nationale d'électricité (SNEL). Lusinde spoke during a panel titled "Déficit énergétique: et si les miniers apportaient la lumière?" at the 10th edition of the Makutano business forum, which took place in Kinshasa from November 13 to 15, 2024.
Charcoal accounts for 67% of the energy market in the DRC. Other studies suggest that wood energy makes up 94% of the national energy mix, contributing to deforestation and global warming. Lusinde noted that this represents a market share that SNEL can capture. "We've done some small experiments... In places where we've put in meters, we've realized that households are reducing their consumption of makala," he explained, highlighting the potential of electrification to lessen reliance on wood fuel.
Despite the liberalization of the electricity sector in 2014, SNEL still controls nearly 90% of installed electrical capacity. Official documents reviewed by Bankable show that in 2023, the DRC's installed capacity reached 3,238.87 MW (97.49% hydroelectric), but only 67.12% of this capacity was operational. This leaves the electricity access rate at just over 20%.
Anti-Makala Coalition
"The challenge today is to see how, with all the mechanisms offered by multilateral banks, for example, we can convert the $4 billion spent each year in the DRC on wood fuel into hydroelectricity production units," said Fabrice Lusinde, highlighting the need to mobilize resources for sustainable energy infrastructure.
This issue was discussed during the Council of Ministers held on November 8, 2024. That day, Teddy Lwamba, the Minister for Water Resources and Electricity, presented an ambitious project called Compact Énergie Nationale. Among others, the project aims to increase access to clean cooking methods from an annual growth rate of 1% to 6% and to raise $18.66 million in capital for this purpose. The project also aims to boost electricity access from 21.5%, now, to 62.5% by 2030. To achieve this, a total investment of $36.5 billion is needed, with $19.5 billion expected from the private sector. However, specific details about the project have not yet been released.
Several stakeholders are also working to improve access to green energy in the DRC. On October 28, 2024, various parties met under the United Nations Development Program (UNDP) to launch the Congolese version of the mini-grids in Africa program. The meeting addressed key issues like financing and operational models suitable for the local context.
The UNDP is already piloting the National REDD Fund (FONAREDD), which is supported by funding from the Central African Forest Initiative (CAFI). This program aims to strengthen production capacities and access to sustainable energy sources while helping to combat deforestation and promote an inclusive energy transition in the DRC.
Jobs at stake
Through its International Development Association (IDA) and International Finance Corporation (IFC), the World Bank plays a key role in transforming the DRC's energy sector. The two arms of the institution support a project focused on improving governance in the country’s electricity and water sectors while enhancing the profitability of companies like SNEL. The total budget for this program is $944 million, with IDA planning to invest up to $600 million and IFC contributing $160 million. Private-sector participation is estimated at $174 million, while the government is expected to provide $10 million.
In the private sector, the Spark+ Africa Fund recently announced a $3 million loan to the Altech Group in the DRC. This funding aims to supply improved cookstoves to over a million low-income customers over 48 months. The investment will also help develop local production capacity by establishing six assembly facilities in the DRC that can produce over 30,000 improved cookstoves per month.
However, reducing reliance on makala (charcoal) may have social consequences. The charcoal sector employs millions of people along its value chain, who could be displaced without compensation if current projects succeed. Additionally, the cost of clean energy remains out of reach for many in the DRC, where the gross domestic product per capita is still below $750, despite improvements in recent years.
Georges Auréole Bamba
Multinational Gigawatt Global will develop a 100 MW solar plant in Kinshasa, Democratic Republic of Congo -(DRC). The company signed the related deal with the Congolese Ministry of Industry and SME Development on November 7, 2024.
According to the non-binding agreement, both parties will conceive, finance, build, and operate the plant.
With an installed capacity of 0.15 MW in 202, Kinshasa relies on other regions for power. The new solar project would thus boost the city’s energy supply, benefiting its 20 million residents, who often face power cuts. According to promoters, the project will focus on areas where many small and medium-sized businesses are located.
The project could create at least 500 indirect and direct jobs. However, before the project begins, several steps must be passed. These include defining how the partnership will work, getting a production permit from the French electricity regulator, and signing a power purchase agreement with a distributor. All necessary studies must also be completed, and funding must be secured.
If successful, this will be Gigawatt Global's largest project so far. The company has previously completed three smaller projects in Rwanda, Burundi, and the USA, with capacities of 8.5 MW, 7.5 MW, and 22.5 MW, respectively. A bigger project (a 135 MW solar plant) should have been developed in Bauchi, Nigeria, but it is yet to begin for lack of “final approval”.
Tanlux Investment attended the recent deal signing with Gigawatt Global in the DRC. However, the firm’s role in the project was not clearly stated. Founded in Luxembourg in August 2022, Tanlux claims to promote renewable energy and ecological agriculture, but there is little information about its involvement in solar projects.
Pierre Mukoko
The Democratic Republic of Congo has launched the National Energy Compact, a project to improve access to electricity. This was announced after the Council of Ministers meeting on November 8, 2024. The project specifically aims to raise the electricity access rate from 21.5% to 62.5% by 2030, thus raising the annual electrification rate from 1% to over 6%.
Congolese Minister of Water and Electricity, Teddy Lwamba, said $36 billion would be needed to achieve this goal. The funds will help finance generation, transmission, and distribution infrastructure, Lwamba said, adding that the government should contribute $16.5 billion, while the private sector is expected to provide $19.5 billion.
The Council of Ministers did not outline how the country plans to secure that amount within six years. However, previous consultations revealed that attracting private investment has been difficult due to a lack of a clear national energy policy. According to a report by the United Nations Development Program (UNDP), the absence of a defined vision and objectives has made it hard to mobilize financial resources for the electricity sector.
Since June 2014, the DRC has had laws to liberalize the electricity sector, but experts say these laws still have limitations. These include confusion over responsibilities within electricity sector organizations and delays in establishing regulatory authorities.
To make the sector more attractive for investment, the report recommends creating regulatory frameworks for managing energy resources like water and biomass, simplifying procedures for developing renewable energy projects, and revising legal frameworks to encourage competition in energy distribution. In detail, the report suggests introducing measures enabling private individuals to sell their surplus renewable energy to third parties (networks or direct consumers); strengthening financial mechanisms, including taxation, to facilitate access to energy services based on renewable energies; and including nullity clauses for any concession granted to a developer unable to meet the needs expressed within its concession perimeter.
Many of these recommendations remain relevant today as the DRC works towards improving its energy access and infrastructure.
Pierre Mukoko
The Kamoa-Kakula copper mine should deliver over 600,000 tonnes in 2026. The mine’s owner, Ivanhoe Mines, stated this on October 30, 2024, during a meeting with investors. On the occasion, Mama Cloete, President and CFO of Ivanhoe Mines, indicated that the figure would be reached “once we have completed Project 95”.
Project 95 will allow Ivanhoe Mines to recover up to 95% of copper concentrate from the same amount of ore mined and at the same operational costs. The project should begin in Q1 2026 and should add 30,000 to 40,000 tonnes of copper concentrate to Kamoa-Kakula’s annual production.
Ivanhoe Mines, primarily controlled by Chinese entities, also plans a phase 4 which could increase the mine’s production to 700,000-800,000 tonnes per year over the next 40 years. The firm seems on track to achieve this goal, although its output forecasts were scaled down due mainly to energy challenges. The firm has been taking various steps to overcome these issues.
For example, it is developing a program to back up power generation at the site. Backup capacity reached 135 MW in September and is expected to increase to 201 MW by the end of the year. Additionally, negotiations are underway to raise imported power from Southern Africa from 65 MW to 100 MW by year-end. There is also a project with Société Nationale d'Électricité (SNEL) to improve power transmission efficiency, which is scheduled for completion in the second half of 2025.
Balanced Finances
Financially, Ivanhoe Mines has been working to boost its balance sheet, with operating costs averaging $3,527.30 per tonne in Q3 2024, lower than the forecast of $3,748. Ivanhoe can also secure low-cost financing through anticipated sales contracts. Also, the current copper prices, at around $9,645 per tonne, exceed Ivanhoe’s forecast of $8,152 per tonne for Kamoa-Kakula this year. The surge in prices spurred stakeholders’ interest in the project. These include the government, foreign and local banks, and shareholders.
However, increased production does not guarantee better outcomes. Market demand, especially from China—the main buyer of Congolese copper—will play a crucial role. China's economic recovery projects are underway, but results are still pending. Additionally, political changes in the U.S., such as President Donald Trump's plans to reduce incentives for electric vehicles and impose higher taxes on imports from China, could impact demand.
On a positive note, new trade alliances within BRICS may support copper demand, as Europe aims to meet its electric mobility goals by 2035. These factors contribute to a sense of optimism in the sector.
Georges Auréole Bamba
Poland will help the Democratic Republic of Congo develop its digital sector. The related Memorandum of Understanding (MoU) was signed on November 8, 2024, by Augustin Kibassa Maliba, the Congolese Minister of Posts and Telecommunications, and Krzysztof Gawkowski, the Polish Deputy Prime Minister for Digitalization. This agreement focuses on improving digital infrastructure, training, cybersecurity, digitizing administrative services, and supporting tech startups, among others.
Specifically, Poland will help the DRC acquire hardware and technology to enhance its communication and digital systems. The agreement also includes support for public administrations to boost efficiency, transparency, and access to services.
Regarding cybersecurity, the deal aims to strengthen the DRC's defenses against cyber threats by providing technical assistance during attacks and developing rapid response strategies.
The memorandum also plans to establish ICT vocational training centers to prepare a new generation of digital professionals in the DRC. These centers will focus on practical training and access to advanced technologies. Additionally, there will be training programs and workshops for ICT professionals and civil servants to enhance their skills in digital technology and cybersecurity.
Support for startups is also included in the agreement, offering opportunities for study trips, professional exchanges, access to technology incubators, funding, mentoring, and essential equipment.
The MoU is a milestone in cooperation between the DRC and Poland, and it is Poland's first digital agreement with an African nation. It follows a meeting between Congolese President Félix Tshisekedi and Polish President Andrzej Duda during the UN General Assembly last September. Since then, experts from both countries have been collaborating on various digital and border surveillance projects.
Pierre Mukoko
Air Congo, a joint venture with 51% ownership by the DRC government and 49% by Ethiopian Airlines, has announced its flight schedule ahead of its launch on December 1, 2024. Each week, the airline will operate 28 domestic flights from Ndjili Airport in Kinshasa, serving six key provinces: Lubumbashi, Goma, Kolwezi, Kalemie, Kisangani, and Mbuji-Mayi.
In an interview with African Aerospace, on November 6, Ethiopian Airlines CEO Mesfin Tasew said the airline is finalizing plans to provide Air Congo two Boeing 737-800. "Since it is a startup, it's difficult to get aircraft. So we have removed two aircraft from our fleet, and the first will be branded with the airline's new logo this week," Tasew told the media. On the same day, Air Congo received its first A350-1000.
During its first six months of operation, Air Congo will focus on domestic flights. After that, Ethiopian Airlines plans to add two more aircraft to expand services to neighboring countries.
Air travel is expected to grow in the DRC as new airlines start operating in the country. In addition to Air Congo's launch, Congo Airways will resume flights on November 10, 2024. South African Airways will also start a direct route between Johannesburg and Lubumbashi.
The launch of Air Congo is likely to create more jobs at Ndjili International Airport, which currently handles about 48 flights daily from various airlines. Ethiopian Airlines and Compagnie Africaine d'Aviation (CAA) operate an average of eight flights per day at the airport.
Georges Auréole Bamba
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The government of the Democratic Republic of Congo (DRC) could dedicate around $7.7 billion or 21,964.7 billion Congolese Francs to investments in 2025. The figure is set under the 2025 draft finance law, under review by the parliament. The figure is up 18.2% compared to 2024, and it makes up 48.7% of the total budget, the largest share.
This investment plan aims to boost the DRC's economy by creating jobs, improving access to essential services like schools and hospitals, meeting growing electricity needs, and enhancing connections between provinces.
The government counts on its own revenues to fund this budget; the revenues are forecast at 9,828.4 billion Congolese Francs. Provinces should contribute over 3,200 billion francs, and around 1,000 billion francs are expected from renegotiating the Sicomines mining contract. The central government will handle investments totaling 2,739.4 billion francs, while international donors are expected to provide the remaining 12,136 billion francs.
The forecast, if concretized, will boost the DRC’s wealth since public investments count towards GDP. The government also plans to use a 10% levy on national revenues to invest in agriculture and create more job opportunities outside the mining sector.
It is worth noting that public investment in the DRC still depends heavily on foreign lenders. As of June 30, 2024, most external debt is held by lenders like the African Development Bank, IMF, and World Bank. The DRC continues to seek dollar resources to strengthen its economy and stabilize its currency.
Another area for improvement is balancing spending between project implementation and direct funding for projects. A July 2024 IMF report noted that spending on salaries and operating costs sometimes exceeds spending on infrastructure itself.
Foreign donors will keep playing a key role in 2025. The government is in talks with the IMF for new agreements worth about $2.5 billion. The previous agreement from 2021 to 2024 provided $750 million for development plans. The World Bank has also announced projects, including $1 billion for the Grand Inga project and a $500 million connectivity program expected to be approved in April 2025.
Georges Auréole Bamba
The Democratic Republic of Congo (DRC) should produce 3.9 million tonnes of cereal this year, up 3.2% from last year. The United Nations Food and Agriculture Organization (FAO) disclosed the forecast in a report issued on November 8.
In detail, rice production is projected at 1.6 million tonnes, while stocks of other cereals, including maize, sorghum, and millet, are expected to total 2.3 million tonnes.
While the forecast is promising, the projected output will not be enough to meet domestic demand. The FAO estimates the country must import 770,000 tonnes of cereals in 2024 to meet this demand, against 745,200 tonnes in 2023. According to the UN body, the country remains one of the most food-insecure nations in Africa and Central Africa.
According to the latest analysis from the Integrated Food Security Phase Classification (IPC), approximately 25.6 million people—about 22% of the population—are projected to be acutely food insecure between July and December 2024.
It is worth noting that this year’s grain output forecast compares with a five-year average of around 3.8 million tonnes.
Kamoa-Kakula, the largest copper mine in the Democratic Republic of Congo (DRC), produced a record 41,800 tonnes in October 2024. Ivanhoe Mines, which owns 39.6% of the project, disclosed the figure on November 4.
This output was 1,453 tonnes more than in August, when a third processing plant started operating. It is also just 8,200 tonnes short of the monthly target needed to reach the mine's full capacity of 600,000 tonnes.
On October 12, Kamoa-Kakula nearly reached its production capacity by producing a record 1,720 tonnes of copper. "This corresponds to an annualized production rate of around 580,000 tonnes of copper, taking availability into account," said Ivanhoe.
However, this increase does not make up for earlier production losses caused by inconsistent electricity supply. As a result, Ivanhoe has lowered its 2024 output forecast from 440,000-490,000 tonnes to 425,000-450,000 tonnes of copper concentrates. Still, this indicates that production could rise further in 2025 after an 18% increase in 2023 to 393,551 tonnes.
Copper prices are also rising. In the first half of 2024, the average price was $9,215.84 per tonne, up from $8,726.90 in the same period last year. Analysts expect prices to average $10,200 per tonne in the last quarter of 2024 and around $10,500 per tonne in 2025. Ivanhoe notes that an average price of $7,000 per tonne over the life of the mine is needed for solid profits.
Sales from Kamoa-Kakula exceeded $2.7 billion in 2023, and they are expected to be higher in 2024. Over the first nine months of this year, sales reached $2.3 billion, including a record $828 million in Q3. This strong performance is attractive to creditors; Kamoa-Kakula has secured $400 million in unsecured financing from DRC financial institutions for expansion. It is also beneficial for the government; by July 2024, Ivanhoe reported that the state had collected over $217 million in taxes on profits and earnings compared to nearly $29 million for all of 2023.
Pierre Mukoko
Congolese PresidentFélix-Antoine Tshisekedi asked his government to include a new component in the second phase of the Local Development Program for 145 territories (PDL 145T). The leader instructed his team during the November 1 Council of Ministers. This component would develop 2,000 hectares in each territory, with 1,000 hectares set aside for oil palm plantations, translating into creating 145,000 hectares of palm groves across the country.
Tshisekedi stated that the goal of this project is "to boost biodiesel production from palm oil throughout the country." Previously, as instructed by the President, the government financially backed the construction of a biodiesel plant in Vanga, Kwilu province. The plant was built by Chrisnovic Sarl
Two years ago, Julien Paluku, the then-Industry Ministry, claimed that boosting biodiesel production would help the DRC “align with countries fighting global warming”. He added that this initiative is part of the Industrialization Master Plan adopted in 2021, which aims to increase industrial production and reduce imports at a cost of over $58 billion. Paluku spoke while visiting Chrisnovic’s facilities.
Cut fuel imports
According to the Services des Entreprises Pétrolières Congolaises (SEP Congo), petroleum product consumption in the DRC is expected to reach about 4 billion liters by 2025. Currently, most of this demand is met through imports. With an average yield of 3.8 tonnes of palm oil per hectare, the planned 145,000 hectares of palm groves could produce between 626 and 988 million liters of biofuel each year. If producing biodiesel is cost-effective, this project could help reduce fossil fuel use, lower imports, and increase the country’s energy self-sufficiency.
Creating and operating these palm groves will also create many jobs. Worldwide, similar projects have generated between 29,000 and 72,500 direct jobs in plantations and related industries, benefiting local communities.
However, the project's success will depend on its economic viability and effective implementation. The President has assigned the Yangambi Research Center to prepare palm nut seeds for the project. He also asked the Presidential Advisory Council of the National Pact for Agriculture and Food (CCP-PNAA) to support the development of these palm groves in all 145 territories. Félix-Antoine Tshisekedi urged the government to actively work on this project and provide "tax incentives" to ensure its success.
Challenges
The minutes of the Council of Ministers do not indicate whether the President's directives are based on a feasibility study for the project. However, spreading it across 145 territories could be challenging, especially given the poor quality of the country's road network, which complicates travel and raises transport costs.
Additionally, there is limited information about the second phase of PDL 145T, which includes integrating the palm grove project for biodiesel production. After a meeting with Planning Minister Guylain Nymb, Finance Minister Doudou Fwamba, and UNDP Africa Director Ahunna Eziakonwa, it was announced that this phase will begin in early 2025.
In August 2023, then-Planning Minister Judith Suminwa Tuluka, now Prime Minister, estimated that this phase would primarily focus on constructing and rehabilitating agricultural feeder roads for $1.25 billion. It is unclear if this estimate still stands or how the funding for this second phase will be secured.
Anticipating potential criticism from environmental groups that view industrial palm cultivation as a cause of deforestation, the President announced plans to create 145,000 hectares of palm groves alongside establishing a 100,000 km² protected area of primary forest. This reserve, called "Couloir Vert, Kivu-Kinshasa," will be located between the eastern and western parts of the country.
Pierre Mukoko