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DRC President Joseph Kabila addresses supporters during an election event in Goma, North Kivu province, Nov. 14, 2011. A British MP is calling for a probe of the sale of mining assets in the wartorn African nation. (AFP/Getty Images/AFP/Getty Images)
DRC President Joseph Kabila addresses supporters during an election event in Goma, North Kivu province, Nov. 14, 2011. A British MP is calling for a probe of the sale of mining assets in the wartorn African nation. (AFP/Getty Images/AFP/Getty Images)

Congo asset sales lose state billions, British MP says Add to ...

A British lawmaker has accused the Democratic Republic of Congo’s government of selling off some of the country’s mining assets for an estimated $5.5-billion (U.S.) below the market value, largely through offshore shell companies that hide the new owners.

Eric Joyce, chair of Parliament’s Great Lakes of Africa Group, called on the British government and the International Monetary Fund, both leading donors to Congo, to immediately find out where the funds had gone.

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The DRC is gearing up for a Nov. 28 election that President Joseph Kabila is favoured to win.

A spokesman for Congo’s government was not immediately able to comment.

Mining in the gold, copper and cobalt-producing nation remains shrouded in secrecy, despite Kinshasa’s pledge to improve transparency in return for a three-year, $541-million credit line that was granted in 2009.

“This powerful evidence proves that the natural resources of the Congo are not being used as a legitimate source of revenue for the people,” said Mr. Joyce, citing a collection of documents detailing the reported sales.

“Instead, a series of complex arrangements between their own government and various (British Virgin Islands) shell companies means that a few are enriched at the terrible cost of the many,” he added.

Mr. Joyce said the documents showed that four sales of assets in Katanga had officially netted the government just $272-million, instead of $5.8-billion, which he said was the estimated total market value for the assets.

The involvement of offshore vehicles had made it impossible to track who had in fact benefited from the sale, he added.

At least one of the sales, involving the Frontier mine, was intended to help pay for the election this year, according to one Congolese lawmaker and documents.

Industry sources say that the actual value of assets may be lower due to the legal risks involved in the assets, some of which were stripped from First Quantum.

The DRC has so far failed to fulfill its pledge to publish its mining contracts and the IMF has called for more clarity on the deals. Through its development agency DFID, the U.K. is due to spend around £200-million ($316-million U.S.) a year on Congo until 2015.

“The IMF has not been firm enough with the DRC government and has allowed the president and his advisers to run rings round them,” Mr. Joyce said, calling on the British government to demand explanations from the IMF.

“I hope the U.K. Government will work with others to finally ask the question, where has all the money gone?”

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