Lack of transparent and accountable ownership of gold mining companies

When the Congolese finally achieved independence in 1960, they may have gained a measure of political freedom, but economically the umbilical cord through which Belgium and Belgian investors had sucked the Congo dry for decades was not severed. It took another six years and very drastic measures by Mobutu to finally gain economic control over the major mining companies, including the gold mines at Kilo-Moto. Even then, whether ownership was truly unencumbered remains unclear and part of an opaque history.
A few years after gold mining began at Kilo and Moto, the Régie Industrielle des Mines de Kilo-Moto was created under the colonial regime, with the entire share capital fully owned by the Belgian State\ and its colonial authorities. By 1926, the company was ‘denationalized’, turned into a stock company with its headquarters in Brussels and re-named the Société des Mines d’Or de Kilo-Moto (SOKIMO). However, the Belgian State through its colonial administration still maintained both capital and managerial control. Another important mining company was the Compagnie Minière des Grands Lacs Africains (MGL), which emerged in 1923 as a subsidiary of the government-controlled railroad Compagnie des Chemins de Fer du Congo Superieur des Grand Lacs Africains (CFL).
The transport company also invested in other gold mining companies, such as the American-Belgian joint-venture Société Mines d’Or Belgika (Belgiakor) and the Mines d’Or de Kindu. There were a number of other companies that where not principally established to mine gold but nevertheless dabbled in it, including a Belgian-American venture, the Société Internationale Forestière et Minière du Congo (Forminière), and the Société Colonial Minière (Colomines), which was formed by private investors and engaged in gold mining through its Société Minière du Congo Belge (Mincobel).
Subsequently, even more convoluted transactions transferred ownership to private sector shareholders or individual investors (see sections on Sokimo Concessions, Concession 38, Concession 39, and Concession 40). In the end, Mobutu’s government enacted the Bakajika Law in June 1966 to finally secure full Congolese control over its land and natural resources. The law gave ownership of all assets above and below the ground to the state, ensuring that the government could claim all public mineral rights – and, in effect, cancelled all previous mining concessions. When Belgium rejected demands to surrender assets associated with its colonial companies, Mobutu broke off negotiations on June 13, 1966, freezing and seizing all major mining assets.
Two days later, the now nationalised Régie Industrielle des Mines de Kilo-Moto was re-established as L’Office des Mines d’Or de Kilo-Moto (OKIMO) and its official headquarters were moved from Brussels to Kinshasa, although the original Belgian office continued to operate for many years as a sales office for OKIMO. Nevertheless, the handover from Belgium to the new Congolese owners was still not complete. Original company documents, and reports and analysis of test-drilling – all of which are critical to the successful management of a mining company – continued to be stored in a private archive in Brussels owned and controlled by Belgian interests.
The acquisition and transfer of gold mining companies did not become more transparent or accountable after the Cold War ended when Mobutu was no longer a protected ally of the West. Under pressure from the World Bank and the International Monetary Fund (IMF) to privatise the country’s mining sector, Mobutu allowed Western mining conglomerates to take their pick. The two areas with the richest gold deposits, which had historically seen the most industrial extraction, were swiftly sold off to Canadian buyers.
  • The Canadian company, Barrick Gold secured the richest parts of OKIMO’s concessions with conditions that were never disclosed.
  • In South Kivu and Maniema, five gold deposits as well as vast areas containing other minerals that were operated by the Société Zaïroise Minière et Industrielle du Kivu (SOMINKI) were sold in a non-transparent manner to a consortium led by British mining magnate Algy Cluff to establish the Canadian company Banro Corporation.