Bloomberg News

Death of Kabila Mine Adviser May Cause Congo Power Struggle

February 14, 2012

(Updates with comment from MagEnergy International in sixth paragraph.)

Feb. 13 (Bloomberg) -- The death of Democratic Republic of Congo President Joseph Kabila’s senior business adviser may trigger a power struggle in one of Africa’s biggest mineral- producing countries, said analysts including Thomas Wilson at London-based consulting firm africapractice.

Augustin Katumba Mwanke, the former governor of copper-rich Katanga province, was among five people who died yesterday when a Gulfstream IV jet crashed after overshooting the runway at an airport outside the eastern city of Bukavu. Congolese Finance Minister Matata Ponyo and at least three other government officials were injured in the incident.

“The death of Augustin Katumba Mwanke will have serious repercussions for the Kabila regime and in particular for the mining sector,” Wilson, senior consultant at africapractice, said by e-mail today. “His removal from the political scene will encourage a power struggle among politicians keen to fill the void.”

Congo holds about 4 percent of the world’s copper reserves and about half its cobalt, a mineral used in rechargeable batteries, according to the U.S. Geological Survey. The Central African nation is the continent’s top tin producer, has deposits of gold and diamonds, and is exploring for oil.

‘Power Behind Throne’

Foreign diplomats and businessmen regarded Katumba Mwanke as “the power behind the throne,” according to a December 2009 secret diplomatic cable published by Wikileaks, the anti-secrecy website. He was instrumental in negotiating a $6 billion minerals-for-infrastructure contract with China and was a confidant of Israeli investor Dan Gertler, who works with companies including Glencore International Plc and Eurasian Natural Resources Corp. in the country, according to the cable.

“Most big businesses needed to work through Katumba and he was also a guarantor of their deals,” Georges Kyriakos, president of Mauritius-based MagEnergy International, which is seeking to develop two hydropower projects in Congo, said today in an interview in Johannesburg. “Without him there there will be a great deal of uncertainty about who will ensure that agreements remain intact.”

Those seeking to take Katumba Mwanke’s place in Kabila’s inner circle may include Evariste Boshab, the head of Congo’s National Assembly, Interior Minister Adolphe Lumanu and Pierre Lumbi, the national security adviser, Jason Stearns, former head of the United Nations group of experts on Congo, wrote yesterday on his blog, Congo Siasa.

Intellect And Network

“No one had the combination of intellect, business know- how and expansive networks that Katumba did, especially in the business sector,” Stearns said“To that extent, no one can easily fill his shoes.”

Katumba Mwanke worked as an “ambassador” for Congo and his death left “a great void” for Kabila’s family, Lumanu told reporters yesterday in Kinshasa, the capital. He didn’t comment further. Boshab wouldn’t comment on the issue to reporters at a briefing held at his house yesterday in Kinshasa. Lumbi’s phone didn’t connect when Bloomberg called him seeking comment today.

Re-elected to Congo’s National Assembly in the country’s Nov. 28 elections, Katumba Mwanke was a former representative of the government on the board of directors of Anvil Mining Ltd., the Australian mining company that produces copper in Congo. The former banker kept a low public profile and worked for Kabila behind the scenes, Wilson said.

The Gatekeeper

“Katumba acted as the gatekeeper to Katanga’s lucrative copper assets for much of the past decade and developed close relationships with many of the country’s largest investors,” he said.

Congo is one the most difficult places in the world to do business, according to the World Bank, which placed Congo 178th out of 183 countries in its Doing Business survey last year. The government is also in transition while it waits for the Supreme Court to certify parliamentary election results.

Parties allied with Kabila won more than 260 out of 500 seats, according to provisional results from the electoral commission. They are expected to form a new government after the Supreme Court announcement, which is scheduled for March 16.

The elections, which also saw Kabila re-elected in November, were criticized by international and domestic electoral observers including Congo’s Catholic Church.

A 2002 UN report on illegal resource exploitation during Congo’s wars, which stretched from the mid-1990s until 2003, recommended Katumba Mwanke be sanctioned.

--With assistance from Franz Wild in Johannesburg. Editors: Paul Richardson, Karl Maier, Antony Sguazzin, James Hertling

To contact the reporter on this story: Michael J. Kavanagh in Kinshasa at mkavanagh9@bloomberg.net

To contact the editor responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net


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