- The close-down of several copper and cobalt mines in the Democratic Republic of Congo's (DRC) southern Katanga Province has now developed into "an economic crisis", according to UN sources.
According to the UN's peacekeeping mission in the DRC, MONUC, today expressed its concern over "the current economic crisis in south-eastern DR Congo’s Katanga province, which has led several mining companies to stop their operations." The crisis was said to be "so alarming" that MONUC was now "assessing the social and security related problems which could result from the situation."
afrol News has earlier reported about several international mining companies that have closed down their copper and cobalt mines in Katanga, referring to the 60 percent reduction of copper prices on world markets. The DRC tops the list of internationally closed copper mines, much due to the country's poor infrastructure and political risks.
The UN peacekeepers have already taken steps to address the situation. Yesterday, the Civil Affairs (CAS), Political Affairs and Electoral Support sections of MONUC met with the Federation of Congolese Enterprises (FEC) in Katanga's capital Lubumbashi to discuss the economic situation in the mineral-rich province, and more specifically the expected job losses in the mining sector.
According to MONUC sources, approximately 52 out of 56 mining companies in Katanga have significantly reduced their output with a view to possible closures, which would ultimately result in 300,000 job losses by the end of this year.
With the world demand decreasing for key raw materials such as cobalt and copper, prices have plummeted and some quoted mining companies have seen their share prices fall by an average of 70 percent.
"The social and economic consequences of the global crisis are being severely felt in Katanga province," MONUC warns. Here, next to Zambia's less affected Copperbelt, the majority of mining activities in the DRC are concentrated.
Statistics provided by the Provincial Labour Division had shown that the mining sector shed in excess of 200,000 jobs in the August to November 2008 period.
"This situation worries MONUC, and during its 10 December last meeting with FEC, CAS recommended a number of actions," the UN peacekeepers announced.
These included educating future laid-off personnel on how to manage effectively the money they will receive in severance pay - amounting to roughly six months salary or US$ 600 - and so avoid sudden impoverishment; establishing a strategy for professional conversion before the layoff; rapidly identifying those professional sectors which can absorb such high numbers of workers; and assessing social and insecurity problems that can result from this situation.
The informal miners, who represent a good portion of the Katanga population, are already clearly hit by the social and economic repercussions of the crisis.
As a result of this meeting, MONUC said it planned to set up an expert committee to conduct an in depth evaluation of the situation, its impact on the security of the population and on the peaceful coexistence of the communities in the province.
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