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The DRC is sometimes called the “the Saudi Arabia of the electric vehicle age” because it produces roughly 70 percent of the world’s cobalt, which is a key component in the production of lithium-ion batteries that power phones, computers, and electric vehicles. Electric vehicle sales are predicted to grow from 6.5 million in 2021 to 66 million in 2040.
The DRC is also Africa’s largest copper producer with some of the mines estimated to contain grades above 3 percent, significantly higher than the global average of 0.6 – 0.8 percent. It also has 70 percent of the world’s coltan, which is also critical to cell phone and computer manufacturing. All in all, it is estimated that the DRC has $24 trillion worth of untapped mineral resources.
On Dec.13, the US signed deals with the DRC and Zambia (the world’s sixth-largest copper producer and second-largest cobalt producer in Africa) that will see the US support the two countries in developing an electric vehicle value chain. US Secretary of State Antony Blinken said the US Export-Import Bank and the International Development Finance Corporation will explore financing and support mechanisms, and the US Agency for International Development, commerce department and Trade and Development Agency will provide technical assistance.
Aside from a Jeff Bezos and Bill Gates-backed copper-cobalt mine in northern Zambia, details are sparse, but it does mark a major turning point for the DRC.
For more than a decade, Chinese companies have spent billions of dollars buying out U.S. and European miners in the DRC’s Cobalt belt, leading to control of 15 of 19 of the primary cobalt mines in the country.
China sources 60 percent of its cobalt needs from the DRC, and about 80 percent of the world’s cobalt processing occurs in China before being incorporated into lithium-ion batteries.The DRC-China relationship is on the rocks, however, and Chinese mining is starting to encounter an increasing amount of bumps in the road.
In July the DRC halted exports from the world’s second biggest cobalt mine amid an ongoing dispute between the Chinese mining company and the DRC state mining company. (China Molybdenum bought the controlling stake in the project in 2016 from US company Freeport-McMoRan.)
With US encouragement, last year DRC President Felix Tshisekedi began accusing his predecessors of signing lopsided contracts with Chinese mining companies and is now attempting to renegotiate them. In a rare sign of DRC bipartisanship, opposition politician Adolphe Muzito who was prime minister at the time the deals were signed with China, has also come out in support of renegotiating the deals with Beijing.
China defends the deals, saying it has built several projects in the Central African nation despite obstacles, increased tax revenue, created more jobs, and provided investment in infrastructure projects such as roads, hospitals and hydropower stations.