DRC Sets Artisanal Mining Scheme

Scruffy depots packed with bags of ore line a road leading to the Democratic Republic of Congo's mining capital Kolwezi, in the southeast of the vast mineral-rich African country.

Behind depot walls scrawled with "CoCu" - signifying cobalt and copper - traders assess the purity of illegally mined ore brought in by informal miners, and fix a price.

But the miners, who mostly work in dire conditions, complain that traders rig purity readings to rip them off.

"There's trickery everywhere," said miner Paul Bande, 45, at the Kamilombe artisanal mine near Kolwezi.

An ambitious scheme is now taking shape in Lualaba province to fix the problem by establishing a government-backed depot.

Known as the Musompo Trading Center, it would cut out mercenary middlemen by offering to test and warehouse ore on behalf of the miners.

Willy Yav, the head of Congolese firm SudSouth tasked by the Lualaba government with running the centre, described the average ore trader as a "mafia guy."

The trading center would also help burnish the image of artisanal cobalt, he explained, and lead to more money and better working conditions for miners.

A traceability and certification scheme, for example, would ensure that ore in Musompo has only been sourced from artisanal mines that meet certain rights and safety conditions.

DRC produces over 70 percent of the world's cobalt, a metal critical to batteries used in electronics and electric cars.

Most cobalt is extracted from giant industrial mines, but over 200,000 people are estimated to work as so-called artisanal miners at illegal mining sites.

Accusations of child labor, dangerous working conditions and corruption in the artisanal sector weigh on DRC's whole cobalt industry.

The impoverished country relies heavily on mining: the sector represented 95 percent of export revenues, and about a quarter of GDP between 2016 and 2021, according to the International Monetary Fund.

Under DRC law, artisanal miners are only permitted to work in government-designated zones and must be members of approved cooperatives.

Yet the law is not enforced. Most artisanal miners work outside the designated zones, in pits and tunnels dug with rudimentary tools, on concessions owned by mining multinationals.

Without a resolution of the legal issues, legitimate buyers will struggle to purchase ore from Musompo.

Other complications abound. For example, the role of DRC's Entreprise Generale du Cobalt (EGC), a state company with a monopoly on buying and marketing artisan mined cobalt, is unclear.

DRC launched EGC in 2021 hoping to develop the artisanal sector and to influence world cobalt prices. But the state firm has not yet bought any cobalt.

Yav hopes the trading center can work with the Kamilombe artisanal mine, on a pilot basis. Success could then serve as model for reforming the entire informal cobalt sector.

"It's very important to fix this," he said, noting that informal diggers will keep invading corporate concessions because they have families to feed.

"Everyone's interest is met through a model like the trade centre".

A USAID critical minerals adviser, who requested anonymity, said the scheme could work but that legal issues, as well as finding buyers for artisan mined cobalt posed complications.

"There's a lot of interest from the provincial government that has an interest in cleaning up this supply chain and also generating a fair tax revenue," he said.