Thursday, 12 May 2016

RDC: GERTLER, KABILA, AND A WIN-WIN FRIENDSHIP

RDC: GERTLER, KABILA, AND A WIN-WIN FRIENDSHIP

12/05/2015


President of the Democratic Republic of Congo 
Joseph Kabila attending the US-Africa Summit 
in Washington, D.C., USA.

The story of Gertler's arrival in Congo and his relationship with its president sheds light on how informal networks often take the place of accountable government institutions in Congolese politics and business, and how a few well-placed men can use the secrecy of the offshore world to male hige profits. While the vast majority of Congolese people remain stuck in poverty.

It starts with a 23-year-old Gertler arriving in Congo in 1997, when the country was coming tthe end of a devastating civil war. He had arrivefrom Israel seeking rough diamonds, hoping for an introduction to the president.

Gertlers grandfather, Moshe Schnitzer, co-founded the Israeli diamond exchange in 1947 and his father was a diamond dealer. He grew up in the world of diamond trading, and from the mid-1990s he had started to buy and sell rough diamonds  that he sourced from some of the most precarious and war-torn countries in Africa.

In Congo, Gertler befriended Joseph Kabila, then in charge of the army. Kabilas father, Laurent- Désiré, had just deposed the dictator Mobutu Sese Seko and become president. A meeting between Gertler and the elder Kabila followed and the two men struck a $20 million deal for a monopoly on Congolese diamond exports.

Laurent-Désiré Kabila was assassinated in January 2001 and was succeeded by his son. Joseph Kabila surprisingly cancelled his friend Gertlers diamond monopoly, but the Israeli continued to trade diamonds  out of Congo. He began to take a more central diplomatic role and acted as an envoy between  Congo, Rwanda and the US as the war was coming to an end. By Gertlers own account, in those fraught and unpredictable years of Kabila juniors reign the diamond dealer stayed loyal to the young president and their bond was reinforced.


Dan Gertler prepares for a tour of the Mutanda copper
and cobalt mine in Katanga province,
Democratic Republic of Congo

In the aftermath of the war, which came to an end in 2002, Gertler re-established control over Congos diamond trade through a $15 million deal to sell 88 per cent of the production of the states diamond mining company, MIBA, for a period of four years. In 2006 presidential elections were held and Joseph Kabila became Congos first democratically elected leader since 1960.

The poll was beset by violence between rival factions, and Kabila's governmet had also courted contreversy in its fire-sale of mining rights to international companies in the wake of the war.

In the lead up to and period immediately after the next elections in 2011 more and more suspicious mining deals were signed, siphoning off Congos sovereign mineral wealth and profiting a small handful of companies and individuals. The deals tended to involve the transfer of assets by Gécamines, the state mining company, and Gertler. In just eight months leading up to the November 2011 elections, companies linked to Gertler bought shares in five mining ventures from state mining companies, according to Bloomberg.

Kabila retained power in the 2011 elections but his win was beset by claims of intimidation and ballot stuffing; independent observers including the UN, the Carter Center and the Catholic Church raised concerns over the validity of the result.

By Global Witness