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Metals and Mining
(As Union Minière du Haut Katanga)
|Albert Yuma (Chairman)|
Jacques Kamenga (CEO)
Jack Rosen (Board of Directors)
|Products||Metals and minerals, energy products, agricultural products|
Number of employees
La Générale des Carrières et des Mines (Gécamines) is a Congolese commodity trading and mining company headquartered in Lubumbashi, in the Katanga region of the Democratic Republic of Congo. It is a state-controlled corporation founded in 1966 and a successor to the Union Minière du Haut Katanga. Gecamines is engaged in the exploration, research, exploitation and production of mineral deposits including copper, cobalt, tin, gold, uranium, zinc, among others.
One of the largest mining companies in Africa, and the biggest in the Democratic Republic of Congo, Gécamines sits on the world's greatest deposit of cobalt and has some of the world's largest deposits of copper. Copper mines in which Gécamines has a major interests include, but are not limited to, Kambove, Kipushi, Kamfundwa and Kolwezi.
Located in the mineral-rich Katanga Province, Gécamines is currently going through a multi-year, multi-billion reorganization strategic development plan with the main objective of repositioning itself as one of the world's top mining majors, mainly by focusing on core strategic assets in which the company has majority shares. Among others, Gécamines has forged partnerships and joint ventures with companies such as Anglo-Swiss Glencore International, American giant Freeport-McMoran and London-based Eurasian Natural Resources Corporation. Seeking to enhance profitability by creating lucrative competitive partnerships, in 2013 the Congolese firm appointed US businessman and American Jewish Congress President Jack Rosen on its Board of Directors.
In 2016, Gécamines and China Non-Ferrous Metal Mining signed a memorandum of understanding for the construction of two factories, one of which includes Gécamines flagship property project of Deziwa, projected to produce 200.000 tons of copper per year.
On the 30 October 1906 the Union Minière du Haut Katanga (UMHK) was founded by the Tanganyika Concessions Limited and Société Générale de Belgique holding companies to mine mineral deposits in southern Katanga Province. The UMHK made its first copper extractions in 1911, totaling about 998 tons. After a decline during the Great Depression, it rapidly grew to become a highly profitable corporation. Net earnings from 1950 to 1959 reached 31 billion Belgian francs. The economic situation of the Congo greatly rested upon the county's relations with the UMHK, but the position of the government in the first few years after independence from Belgium was weak and the administration was unable to exercise much influence over the company's activities.
Following Joseph-Désiré Mobutu's seizure of power, the government refocused its efforts on "economic nationalism", including the assertion of control over UMHK. In addition to maximising his government's revenues, Mobutu hoped that by exerting authority over the company he could expand his power as president. Tensions between the government and the corporation rose after the former imposed a large tariff increase on exports. In late April 1966 the latter raised copper prices without consulting the Congolese government. Mobutu responded by increasing export taxes, ordering the retaining of 10% extracted minerals by the government as a strategic reserve, and announcing intentions to statutorily mandate the incorporation of the UMHK in the Congo by 1 January 1967.
UMHK representatives began negotiating a compromise with Congolese officials. They proposed splitting the company into two separate corporations—one based in Belgium, the other in the Congo. The Congolese found the terms unacceptable and on 8 December declared that the UMHK would have to accede to the legislation requiring its incorporation in the Congo before the new year. Tensions reached a breaking point on 23 December when the UMHK announced that it would not relocate its headquarters to Kinshasa. Mobutu responded immediately, halting copper exports, seizing UMHK accounts, and establishing a provisional board to manage the mining operations. The government maintained that it was not nationalising the company; the UMHK had refused to comply with the law and thus forfeited its right operate. On 1 January 1967 the government declared that the UMHK in the Congo was from then on a parastatal to be known as Générale Congolaise des Minérais, or Gecomin. It was intended that the state would only hold 60% of the company, but after foreign investors showed no interest in the remaining shares it became entirely a government enterprise.
Following the takeover Gecomin was embroiled in conflict as the UMHK attempted to resist the Congolese government. The former told employees that they had a month to return to Belgium at the company's expense or have their contracts invalidated, while the latter warned them that they had to give 12 months' notice before their departure. The UMHK threatened legal action against anyone who purchased their seized copper and pressured other corporations to refrain from partnering with the Congolese to manage the mines. The standoff resolved on with an agreement on 15 February 1967. The UMHK recognised the legitimacy of Gecomin and relinquished all responsibilities concerning its mines, while the Congolese government abandoned its claims to UMHK shares in Belgium. Gecomin was to received technical expertise and managerial support from an affiliate of the Société Générale de Belgique, the Société Générale des Minerais (SOGEMIN). SOGEMIN in turn received a portion of Gecomin's revenue, which served as recompense for its own services and reimbursement to the UMHK. Negotiations on the final compensation for UMHK were concluded in the early 1970s.
In 1971 the company's name was changed to Générale des Carrières et des Mines, or Gécamines. In 1974 the global price of copper fell dramatically. As a result, Gécamines' operations were devastated until the early 1980s.
Once producing 500,000 tonnes of copper a year in its 1980s heyday, the company's fortunes declined due to mismanagement and government interference. Nonetheless, the company remained crucial to Congolese finance. In 1989, Gécamines provided 85% of DR Congo's export earnings (against 60% provided by the UMHK in 1960), and 42% of public revenues, making it by far the most important company in the country.
In the 1990s, Gécamines financial situation took a blow, adversely affected by several issues, including aging infrastructure and equipment, the closure of Kamoto Mine in 1990, and ethnic riots in Shaba. These led to a slump in production -- see copper production chart below.
Production of copper, by year.
- 1989: 440,848 tons of copper, 54,043 tons of zinc.
- 1990: 376,000 tons of copper.
- 1991: 240,000 tons of copper, 30,000 tons of zinc, 9,800 tons of cobalt.
- 1994: 32,412 tons of copper, 2,515 tons of zinc, 3,631 tons of cobalt.
- 2001: 27,507 tons of copper, 3,463 of cobalt.
- 2002: 21,186 tons of copper, 828 tons of zinc, 1,780 tons of cobalt.
- 2003: 16,172 tons of copper (8,000 tons of refined copper), 1,200 tons of refined cobalt.
Gécamines is still in possession of proven, probable, and possible ore reserves of copper (56 Mt contained metal), cobalt (4 Mt), and germanium (3.4 Mt), and zinc (6.4 Mt). With assistance from the World Bank, aided by partnerships with other firms and by proper governance in DR Congo, Gécamines hopes to resume its former copper production.
Sites owned by Gécamines
- Kakanda/Kambove mines (copper and cobalt), jointly with the International Panorama Resources Corporation
- Kamfundwa mine (copper) jointly with the Harambee Mining Corporation and Sogemin
- Kipushi mine (copper, gold and zinc) jointly with Ivanplats
- Kolwezi mine (copper and cobalt)
- Katanga (disambiguation)
- "Congo's Gecamines Shelves Sale of Stake in Glencore Copper Mine". The Wall Street Journal. June 2, 2014. Retrieved 2016-06-02.
- "La Gecamines nomme l'homme d'affaires Americain Jack Rosen comme Administrateur" Agence Ecofin November 7, 2013. Retrieved 2016-02-14
- "Gecamines Congo Signs Mine Deals With Two Chinese Companies" Bloomberg Business July 13, 2015. Retrieved 2016-02-14
- "Congo state miner signs MOU with Chinese firm to raise copper output"Reuters January 25, 2016. Retrieved 2016-02-14
- Kisangani 2016, p. 261.
- Young & Turner 2013, p. 290.
- Young & Turner 2013, p. 291.
- Young & Turner 2013, pp. 291–292.
- Young & Turner 2013, p. 292.
- Young & Turner 2013, p. 293.
- Kisangani 2016, pp. 261–262.
- William Clowes; Thomas Wilson (November 2, 2017). "Congo's Gecamines Accounts Missing $750 Million, Group Says". Carter Center.
- A State Affair: Privatizing Congo’s Copper Sector (PDF) (Report). Carter Center.
- Ivanplats description http://www.ivanplats.com/s/Kipushi.asp
- Kisangani, Emizet Francois (2016). Historical Dictionary of the Democratic Republic of the Congo (4th ed.). Rowman & Littlefield. ISBN 9781442273160.
- Young, Crawford; Turner, Thomas Edwin (2013). The Rise and Decline of the Zairian State (illustrated, reprint ed.). Madison: University of Wisconsin Press. ISBN 9780299101138.