MONUC to Pull Out of DR Congo

Withdrawal of UN could set DRC on fire  
May 16, 2010

By Franz Wild and Michael J Kavanagh

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Congolese President Joseph Kabila’s insistence that UN peacekeepers end a decadelong mission may hamper the operations of firms, including AngloGold Ashanti and Mwana Africa, and deter further investment in the mining industry.

A UN security council delegation was expected in the country on Friday to set out security objectives it says must be met before 20 500 troops are pulled out by the end of next year. The UN officials are expected to leave by today and the council will meet in New York before the end of the month to discuss a phased withdrawal from the Democratic Republic of Congo (DRC).

Mwana, based in London, is among companies that say the withdrawal of the force, known as Monuc, may create a security vacuum in the east of the country, leaving its operations vulnerable to armed groups.

AngloGold, which in 2008 evacuated staff over security fears, and Toronto-based Banro operate there.

"If there is no good security this could jeopardise the mining projects," said DRC country manager for Mwana, Jean-Prosper Ngandu. "There is a risk. This is scary for investors."

Kabila says the UN is impinging on DRC's sovereignty and the country will be ready to take care of its own security needs when elections are held next year, according to Guillaume Lacaille, an analyst at International Crisis Group.

"Even though there are problems, we can resolve the problems to ensure the security of our economic partners," said Communications Minister Lambert Mende. "We don't need Monuc. We'll be able to resolve the problems ourselves."

The majority of Monuc's forces are based in the DRC's eastern borderlands, which are rich in gold, tin and coltan, an ore containing tantalite that is used in the manufacture of cellphones. Various rebel groups roam the region, which stretches about 1 000km along the border with Rwanda, Uganda and Sudan, frequently attacking civilians and mines.

"The security situation isn't totally guaranteed," said Guy- Robert Lukama, AngloGold's representative in the DRC. "However, we invested long term, so we calculated that Monuc will leave at some point."



Monuc's exit

The DRC is Africa's biggest tin producer, holds a third of the world's cobalt reserves and 4 percent of all copper, according to the US Geological Survey.

The Mines Ministry projects that gold production may increase sixteenfold to 3.6 tons by 2012, when AngloGold and Banro mines begin operations.


Randgold Resources also plans to invest about $480 million (R3.6 billion) in the DRC.

Mining exports from the DRC last year were estimated at $3.1bn, making up four-fifths of total exports, according to the International Monetary Fund.

Since Monuc's arrival in 1999, Kabila has been able to consolidate his power across most of the country, in step with an economic recovery.

Growth is forecast at 5.4 percent this year, compared with a 10.4 percent contraction in 1999, and the country's inflation is projected to slow to an annual 15 percent this year, from 280 percent in 1999.

The UN mission arrived in the middle of a conflict that would eventually kill about 5 million people, mostly from disease and starvation.

The peacekeepers helped end the war in 2003 and secured the country's first multiparty-vote in four decades in 2006. Still, since the end of the war, Monuc has been criticised by groups, including Human Rights Watch and Oxfam, for not doing enough to protect civilians in the country.

The UN will pull out 2 000 of its troops by the end of next month, secretary-general Ban Ki-moon said last month, adding that a full withdrawal might follow next August.

The DRC wants to boost the revenue it earns from mining to help fund its $5bn annual budget. Those plans may be stymied by Monuc's withdrawal, according to Philippe de Pontet, an analyst at New York-based Eurasia Group.

"Investors are concerned about a precipitous Monuc withdrawal and the possibility of new security vacuums arising in the east," he said.

Monuc's presence has not been enough to end all conflict. In the eastern Kivu provinces, Rwandan rebels control swathes of territory and mines, and attack civilians.

Uganda's rebel Lord's Resistance Army killed 1 100 people in the northeastern Orientale province last year.

Last month, insurgents briefly took control of the airport in Mbandaka, the capital of the northern Equateur province. "The situation remains extremely fragile, so we have to do it right rather than do it quickly," Gerard Araud, France's ambassador to the UN, who is leading the security council delegation to the DRC, said of the withdrawal timetable. - Bloomberg