15th March 2018
Data source: S&P Global Market Intelligence
The Democratic Republic of the Congo’s will declare cobalt, coltan, lithium and germanium as strategic, resulting in higher royalties for the government, Reuters reported March 15, citing Jean Nkunza, an adviser to the prime minister.
President Joseph Kabila recently signed a new mining code into law, despite opposition from mining companies. The new mining code hiked mining royalties to 3.5%, however, strategic minerals will be taxed at 10%.
“We need to make enough money before we run out of these minerals so that is why they are strategic to the country,” Nkunza said.
“We have to make sure for the next 20 years we make money from these minerals because demand is going to be so high. It’s going to continue to grow and we are not going to stop raising the royalties on these minerals.”
The report said the announcement was viewed as an attempt to pre-empt negotiations to determine how metals would be classified. According to the report, the mining code also scrapped a 10-year stability clause.
The Chilean analyst agreed. Rio Tinto, among others, may still make bids. Would it hurt Nutrien? “We’ll see.”