Michael Demey, Regional Manager, BCDC

BCDC is the oldest bank operating in DRC and speaks to GBR about its activities with the mining sector.

BCDC was founded in 1909, and as such is the oldest bank in the DRC. How has the institution evolved and what role does it play in the mining sector?

With more than 100 years of experience in Congo, BCDC is a long-lasting and a robust institution that inspires respect in the DRC and beyond. Despite regulatory constraints and economic situations, we have strong fundamentals and the profitability of the last years prove it by.

Through our expertise, BCDC is the partner of all major players in the DRC including the biggest mining projects. BCDC has played a major role in the mining sector for decades. Through our vast network located in the mining area and even within some mining sites, we provide the different banking services needed: facilities for the working capital, payroll solutions, follow-up on transactions and regulations…

What are some of the key services BCDC offers and how would you describe your role in the mining industry?

DRC banks offer more-or-less the same kind of banking services. We strongly believe that BCDC stands out amongst its competitors by its knowledge of the local regulations as well as foreign exchange regulations which are of particular importance given the investments that mining companies realize in the DRC. As an example, BCDC is proud to say that, given the volume of transaction given by mining companies, we have achieved with success and for many years the different control from local authorities. We strongly believe that our regular reporting and follow-up on import/export licenses and documentary bills is the core of that achievement.

Basically, BCDC is the long-term partnership of the long-term mining projects of DRC. From the exploration of the project to the installation of the company (importation stage), the beginning of production and finally the exportation stage, the bank will accompany our customer in the different steps in order to mitigate their risk. Through close follow-up on the transactions related to import and export, we protect the interests of our client and by doing so, the interest of the bank.

From a banking perspective, what are the most significant risks of which investors interested in the mining sector here should be aware?

The political situation of the country remains unclear for 2018. The business climate is really challenging and the mining code is on the way to be reviewed. Let’s be clear, all theses aspects will not encourage new players to come now to DRC and invest millions of dollars.

But on the other hand, the current price for copper and cobalt, the perspective of these commodities and the proven reserve in the Copperbelt make DRC a strategic place for mining investors.

In the face of these complex challenges and reality, it is very important to work with financial partners that fully understand the rules and regulations in the country.

What does the splitting of the provinces mean for the world of finance for DRC?

The ongoing reorganization of the new provinces is complex. It can take some time and adjustments but the process is on the way. It can result in situations that are a bit more complicated with duplication of different regional taxes and numbers of interlocutors.

For the mining companies in the former of Katanga province, it can have some consequences. They have to deal with different provinces on the field. For instance, the location of the mine site could be located in one province and the location of the DRC exit point for the commodities located in another province.

The bank’s comprehensive network across the DRC enables us to provide the financial services and advises requested by our clients wherever they are.

What sort of initiatives does BCDC have in place to support the capacity of local players to participate in the mining sector?

There is a law (not yet in force) regarding the subcontractors in DRC that want to boost local SMEs to participate in the mining sector. The ongoing discussion on the revision of the mining code also emphasizes on that local content.

BCDC has always been a key actor for local subcontractors. Even before the ongoing initiatives, BCDC has shown an appetite to follow them from training, advisory to access of finance. BCDC has developed a strong footprint in order to fulfill their expectations. As an example, BCDC has been a key actor of local players in the city of Kolwezi where you find some of the biggest mining projects. Our knowledge of the market after more than a century in DRC and the fact that our decision makers are all based in DRC, allows us to have a comprehensive approach on these challenges.

What is BCDC’s outlook for the DRC over the next few years?

The demand for copper is on the rise and will be for a while. The run on cobalt price is vertiginous with the largest reserves known in the world. Whether we want it or not, DRC is a strategic place for the coming years. A strong political vision and pragmatic approach from different companies will help to bring up DRC’s overall economy and standing. The Copperbelt is here to stay and companies are looking to enter the DRC. We do not have to promote the DRC; everyone is already convinced. All we have to do is to straighten out the political situation and a stable mining code providing the base for all parties to get benefits.

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