Friday, 31 December 2021

DR Congo: All the president’s promises. Congo’s president has not kept his word

DR Congo: All the president’s promises

Congo’s president has not kept his word


From free schools to peace in the east, Félix Tshisekedi has failed to deliver



Louis bahati, a teacher at a primary school in Goma, a city in the east of the Democratic Republic of Congo, has not been paid for more than two years. Struggling to feed his family and on strike for a second time, he took up a job painting a neighbour’s house. When a passing pupil spotted him, he was humiliated. “My class mocked me,” he says. “The student told them that he had seen their teacher, covered in dirt, doing this painting work.”

Although Mr Bahati has been a teacher at a state school for six years, he has not yet been added to the government payroll. This meant that when President Félix Tshisekedi (pictured) announced that primary education would be free from September 2019—which was one of his main election promises—Mr Bahati stopped receiving any pay. Like thousands of other teachers who were not on the books, he relied on fees from parents. After the president’s announcement, they stopped paying.

 The snag with the president’s pledge was that his government does not have enough money to pay teachers’ wages. Even some of those who were on the payroll had their salaries chopped in half, to $140 a month in most cities and $90 in villages. When teachers went on strike for two weeks in October, schoolchildren stormed parliament chanting, “We want to study,” and “If we do not study we will end up on the streets taking drugs.”


To make matters worse, scores of fake teachers working at non-existent schools have somehow made their way onto the payroll, according to a report by the Inspectorate General of Finance. It revealed that some $31m earmarked for education had been embezzled. This prompted the World Bank to suspend its first payment of the $800m it had committed in support of Mr Tshisekedi’s free-schooling programme. The government has since told teachers that they will be paid in January, which encouraged some to go back into their classrooms. But many, including Mr Bahati, do not believe the government and are still on strike.

 The fiasco highlights a wider problem: Mr Tshisekedi’s tendency to promise the moon. As well as his pledge of free primary schooling, he also campaigned on a vow to bring peace to the east of the country and to stamp out corruption. The electorate seems to have placed little faith in these undertakings. In presidential elections in 2018 he came a distant second, with about 19% of the vote, according to an independent tally by the Catholic church. It said the poll had been won by Martin Fayulu, a charismatic anti-corruption campaigner. Mr Tshisekedi nonetheless claimed victory and came to power, seemingly after a back-room deal with the outgoing president, Joseph Kabila, whereby he is alleged to have promised to leave the unpopular Mr Kabila in control of much of the state.

 Since then, however, Mr Tshisekedi has cunningly managed to distance himself from his predecessor, form a new coalition and consolidate his grip on power. He has even managed to fire some of Mr Kabila’s closest allies, including the chairman of Gécamines, the national mining company and piggy-bank to Mr Kabila’s friends. Its former chairman, Albert Yuma Mulimbi, has been accused of diverting more than $8bn in revenue from copper and cobalt mining. Even so, the president can hardly claim to have stamped out graft. Since he came to office Congo has slipped by nine places to 170th out of 180 in a ranking compiled by Transparency International, an anti-corruption watchdog.

 The president has also made little progress in honouring his pledge to restore security and defeat the armed groups that have terrorised eastern Congo for 25 years. More than 5.5m people who have been forced from their homes are still unable to return. Many live in miserable camps that are sometimes attacked by rebels. In November a militia stormed one in Ituri province, killing 44 people. Soon after that an armed group kidnapped two aid workers near Goma. In a bid to restore order Mr Tshisekedi imposed martial law on two of the bloodiest eastern provinces in May, though to little effect. In November he allowed troops from neighbouring Uganda to cross the border to attack one of the more dangerous groups, the Allied Democratic Forces (adf), a militia that has links to Islamic State, after it detonated bombs in Kampala, Uganda’s capital. But this has not made locals feel any safer. Many fret that the Ugandan troops will outstay their welcome and plunder the region’s minerals, as they did during Congo’s second civil war, which raged from 1998 to 2003.

 To be fair, Congo is not an easy place to run. “Tshisekedi has the hardest job in Africa,” says Piers Zvegintzov, a security adviser based in the capital, Kinshasa. It entails “managing an impossible coalition of adversaries while desperately trying to build a real power base, drive through reforms and not get assassinated.” Trying to win a fair contest in the next presidential election in 2023 must now be added to that list. Some worry that because Mr Tshise kedi has failed to honour any of his campaign pledges, he may simply try to rig the vote. “There are two ways to stay in power,” says a ruling-coalition mp who asked not to be named. “One is to become popular by doing the work you promised—another is to be strategic.” By “strategic” he means cheating, adding that “Tshisekedi has gone for the latter.”

Lawmakers have appointed one of his allies, Denis Kadima, as the head of the electoral commission. The constitutional court, which would have the final say if the vote were contested, is being stacked with Mr Tshisekedi’s loyalists. The Catholic and Protestant churches, which are among the few respected institutions in Congo, have criticised Mr Kadima’s appointment. So have opposition parties, which say it will erode trust in the election. “We will intensify our protests until they depoliticise the electoral commission,” says Mr Fayulu. But the protesting has not gone well. When a sit-in was organised outside the electoral commission in November, truckloads of heavily armed police blocked the road leading to it. At another rally there were clashes between protesters and Mr Tshisekedi’s supporters, some of whom the president has allegedly shipped in from his home region, the Kasai provinces.

 As for those living under Mr Tshise kedi’s rule? “Life is unmanageable, we are even struggling to eat,” says Mr Bahati. “I do not see any change with this regime.” It is unfortunate, then, that the regime seems set on staying.

 

By The Economist

 

 

Thursday, 1 July 2021

L’histoire méconnue d’une production rizicole ratée : Feronia Inc. en République démocratique du Congo

 L’histoire méconnue d’une production rizicole ratée : Feronia Inc. en République démocratique du Congo

01/07/2021


Meurtres, accaparement des terres, engagisme. Voici quelques-unes des accusations portées par des communautés de RDC à l’encontre de Feronia Inc., une entreprise canadienne qui a reçu plus de 150 millions de dollars de financement de la part de banques européennes de développement.

La plupart de ces accusations troublantes concernent les grandes plantations de palmiers à huile situées dans les provinces de l’Équateur et de la Tshopo, que l’entreprise a rachetées à Unilever en 2009. Mais les premières années de Feronia en RDC avaient aussi pour projet une grande ferme rizicole au Bas-Congo qui, selon l’entreprise, permettrait à terme de libérer le Congo de sa dépendance vis-à-vis des importations alimentaires.

En 2016, Feronia avait déjà englouti au moins 14 millions de dollars dans ses projets rizicoles avant de brutalement « mettre fin » à toute sa division « Arable Farming » en 2017, sans aucune explication. Quelques années plus tard, Feronia déclarait faillite et à la fin 2020, ses plantations de palmiers à huile passaient aux mains d’un fond de capital-investissement.

On soupçonne depuis longtemps que les projets agricoles de Feronia servaient de façade pour transférer des fonds à un éminent homme politique congolais qui avait facilité l’entrée de Feronia en RDC. Les accusations d’éventuelle corruption étaient bien connues quand la banque britannique de développement, le CDC Group et d’autres banques de développement ont commencé à financer Feronia. L’entreprise comme les banques de développement ont contesté ces accusations et aucune enquête sérieuse n’a jamais été menée.

Les nouveaux éléments d’information évoqués ci-dessous fournissent des raisons supplémentaires de soupçonner que la division Arable farming de Feronia était peut-être impliquée dans des activités frauduleuses, alors même que l’entreprise recevait des fonds de plusieurs banques de développement. Cela suffira-t-il à déclencher une enquête en bonne et due forme pour déterminer le rôle que le financement de Feronia par les banques de développement a pu jouer dans la corruption en RDC ?

Des liens étroits avec le plus proche conseiller de l’ancien président Joseph Kabila

En 2009, quand Feronia a acheté PHC, l’entreprise de plantation de palmiers à huile d’Unilever, la transaction s’est faite via une entreprise des Îles Caïman, Feronia JCA Limited. « JCA » faisait référence à la SARL Jean Collette Afrique, une entreprise détenue à 100% par Kikaya Bin Karubi, homme politique de haut niveau, alors très proche du président de la RDC Joseph Kabila. Lorsque Kabila accède au pouvoir en 2001, Karubi devient ministre de l’information, avant d’être nommé ambassadeur au Royaume-Uni en 2009. En 2014, il est rappelé à Kinshasa où il devient conseiller principal du Président jusqu’à la chute de Kabila en janvier 2019.

À propos de Dan Gertler, magnat corrompu de l’industrie minière,
 l’homme politique congolais Kikaya Bin Karubi (ci-dessus) répond
 à Bloomber News : « Ce n’est pas un Gertler qu’on veut, mais 10. »

À travers son entreprise Jean Collette Afrique, Bin Karubi détenait 20% de l’entreprise Feronia JCA Limited enregistrée aux Îles Caïman. Mais un an seulement après son arrivée en RDC, Feronia affirme avoir racheté les 20% de Bin Karubi ainsi qu’une ferme qui lui appartenait située juste en-dehors de Kinshasa, à Kasangulu, pour un total de quelque 2,2 millions de dollars. Karubi a également perçu chaque année 120 000 dollars de loyers pour sa maison de Kinshasa (pendant qu’il était ambassadeur au Royaume-Uni) ainsi qu’une rémunération pour sa participation au conseil d’administration de Feronia.

En 2012, un communiqué de presse de Feronia affirme que la ferme de Kasangulu produit des mangues, des avocats et des ananas, mais la ferme n’est jamais mentionnée dans les rapports financiers de l’entreprise ni sur son site Internet. Elle n’apparaît pas non plus dans la procédure de faillite entamée par Feronia Inc. en 2020. Cette ferme que l’entreprise prétend avoir achetée pour environ 600 000 dollars a tout simplement disparu des registres de Feronia.

Ce que Feronia nomme sa division « Arable farming » concernait une autre ferme, plus grande, située près de la ville de Kimpese dans la région du Bas-Congo. Cette division agricole appartenait à la filiale Feronia de Kinshasa, Feronia JCA Ltd. SPRL, qui supervisait trois autres filiales congolaises : Feronia PEK (l’entreprise agricole de Kimpese), Kimpese Agro Industries (l’entreprise de transformation des récoltes) et Bas-Congo Ferti (responsable des achats d’engrais pour les divisions agriculture et huile de palme de Feronia).



L’entreprise agricole Feronia PEK était détenue à 20% par Plantations et Élevages de Kitomesa, une entreprise locale qui semble être la propriété de la famille Tuluka (connue aussi sous le nom de Groupe Yaya). Selon les rapports d’entreprise de Feronia, Feronia aurait acquis sa ferme de 10 000 ha près de Kimpese auprès des propriétaires de cette entreprise, qui auraient reçu en échange une participation de 20% au capital de Feronia PEK.

Des documents de l’entreprise montrent aussi que l’entreprise Feronia JCA Ltd SPRL de Kinshasa était gérée par l’ancien patron de la plantation d’Unilever, Raymond Batanga, et était détenue à 20% par Bin Karubi au moins jusqu’en février 2014, date à laquelle l’entreprise a été dissoute et fusionnée avec le groupe Feronia. Cette entreprise a donc fonctionné encore longtemps après que le CDC Group et le fonds pour l’agriculture africaine (l’AAF, fonds mauricien géré par Phatisa et appartenant à de nombreuses banques de développement) ont commencé à investir dans Feronia.


Politique africaine du gouvernement fédéral :
 des millions pour les despotes

Une enquête sur les dossiers de Feronia JCA Ltd SPRL, obtenus auprès du registre des entreprises de Kinshasa, a révélé toute une série de dépenses douteuses, dont des paiements non spécifiés pour « services » et des loyers de quelque 150 000 dollars annuels versés à Bin Karubi pour un appartement situé à une adresse différente de celle de sa maison. Feronia a reçu au moins 28 millions de dollars de prêts grâce à cette entreprise et versé des millions de dollars de « services » pour des raisons non précisées dans les rapports financiers de Feronia Inc. Aux questions posées à Feronia par une équipe de journalistes allemands concernant les prêts accordés à Feronia JCA Ltd SPRL, le PDG affirme que l’argent a servi principalement à la construction d’une usine de traitement du riz à Kimpese et à la préparation des terres agricoles par Feronia PEK. Selon lui, au moins 8,6 millions de dollars ont été dépensés pour préparer la terre et 5,6 millions pour construire l’usine.

En 2011, Feronia annonce sa première production de riz à la ferme de Kimpese, affirmant avoir récolté sur 1 200 ha mais déplorant des rendements peu élevés. En 2012, l’entreprise récolte du riz sur 305 ha et plante 140 ha de haricots. La même année, la construction de l’unité de stockage du riz et de l’usine de traitement du riz de Kimpese est terminée. L’entreprise affiche fièrement sur son site Internet les photos des sacs de riz qu’elle vend avec le logo de Feronia.a de haricotsh

Sacs de riz Feronia

En 2014, Feronia déclare que les actifs de sa division agriculture représentent une valeur de 7 millions de dollars et que de lourdes dépenses dans cette division ont entraîné des pertes de 4,9 millions de dollars sur l’année. C’est à ce moment que l’enthousiasme de Feronia pour sa section agriculture commence soudainement à faiblir. Dans son rapport annuel de 2015, Feronia indique avoir passé un accord avec un « partenaire » non nommé pour mener une étude de faisabilité de sa division agriculture sur deux ans et un « test de dépréciation » qui ont révélé une charge de 3,5 millions de dollars. Les pertes déclarées dans la comptabilité atteignent 5,9 millions de dollars ; elles sont dues en grande partie aux charges de dépréciation.

Dans son rapport annuel de 2017, Feronia déclare 2 millions de dollars supplémentaires de pertes pour sa division agriculture et annonce mettre fin à ses activités agricoles suite à l’étude de faisabilité. Aucune raison n’est donnée pour expliquer la décision. Tant pis pour ce que le PDG de Feronia avait un jour nommé « l’un des plus grands projets d’expansion agricole jamais entrepris ».

Luc Gérard entre en scène

Des informations obtenues via le compte Twitter de l’homme d’affaires belgo-congolais Luc Gérard Nyafé suggèrent que son entreprise, Strategos Plantations, a été associée à l’usine de traitement du riz de Kimpese en 2017, ou même plus tôt (voir Encadré 1 : le groupe Strategos). Ses tweets indiquent que Strategos a acquis l’usine à une date antérieure à 2017 et commencé à produire son propre riz avant 2018. On ne sait pas exactement si Strategos a également racheté la ferme de Kimpese. On ne sait pas non plus si le rachat de l’usine a eu lieu avant que la division palmier à huile de Feronia ne reçoive un prêt de 49 millions de dollars de la DEG (Allemagne), la FMO (Pays-Bas), BIO (Belgique) et d’autres banques de développement.

L’annonce de l’achèvement de l’usine sur le site Internet de Feronia en 2012 et 
le tweet de Luc Gérard du 4 novembre 2017

GRAIN a demandé des éclaircissements à Strategos, mais l’entreprise a refusé tout commentaire. Voici sa réponse : « Veuillez noter que même si Strategos Plantations a eu des relations commerciales avec Feronia par le passé, ces relations sont terminées. Veuillez également noter que nous ne sommes pas libres de révéler l’ampleur desdites affaires pour des raisons de confidentialité. »

Ce qui est certain, c’est que Strategos a racheté une usine ayant autrefois appartenu à Feronia et dont la valeur serait d’au moins 8 millions de dollars, sans que les comptes de Feronia n’enregistrent la moindre trace de cette vente.


Le Groupe Strategos

Le Groupe Strategos (enregistré dans le paradis fiscal du Delaware, aux États-Unis) appartient à l’homme d'affaires belgo-congolais Luc Gérard Nyafé. Celui-ci a fait fortune en Colombie où il s’est joint à des acteurs financiers locaux au bras long pour lancer un fonds de capital-investissement, Tribeca, qui a eu accès à des centaines de millions de dollars du fonds de pension national colombien. Il a également obtenu un master en sécurité et défense de l’École supérieure de guerre colombienne. Gérard s’est rapidement lancé dans le secteur minier et les soins de santé privés. En 2015, il a jeté son dévolu sur la RDC.

Le père de Gérard était propriétaire d’une plantation de café en RDC et il semblerait que Gérard ait investi dans l’agrobusiness en RDC dès les années 1990. Mais en 2015, il revient en force dans le pays, fonde la société Strategos Plantations, et rachète deux des grandes concessions de plantation d’Unilever et deux exploitations agricoles (dont celle de Feronia à Kimpese, semble-t-il).

Luc Gérard en couverture de Forbes Africa. Luc Gérard Nyafé serre la main du Présidentde la RDC 
Félix Tshisekedi

Puis en 2018, avec l’élection de Félix Tshisekedi, Gérard prend un rôle bien plus important : nommé ambassadeur itinérant par Tshisekedi, il devient aussi l’un de ses principaux conseillers. Il est chargé de la lucrative zone économique spéciale de Maluku. Il met aussi en place une société minière, la Compagnie des minerais stratégiques (CMS) à Kinshasa en juin 2019, pour étudier les données géologiques de 17 projets miniers en RDC et au Mali, dont il avait fait l’acquisition en décembre 2018. En décembre 2020, Gérard est élu président du Parti d'Union Républicaine, un parti politique récemment formé en RDC.


En 2020, Gérard a déclaré que Strategos avait vendu son usine et ses activités rizicoles à Bio Agro Business (BAB), une entreprise congolaise profondément impliquée dans les projets agricoles du Président Felix Tshisekedi. L’un des dirigeants de l’équipe de BAB est Raymond Batanga (l’ancien directeur de Feronia JCA Ltd SPRL). L’un des autres acteurs clés de cette entreprise est l’agronome italien Giovanni Mazzotti, qui a travaillé auparavant pour le projet entaché de scandales mené par Senhuile au Sénégal.

Tweet de Luc Gérard du 7 juin 2020

Pour la distribution de son riz, BAB a passé un accord avec EGAL Sprl, une entreprise congolaise qui a été accusée d’avoir facilité le détournement de millions de dollars vers les comptes bancaires d’acolytes de l’ancien Président Kabila à travers un programme gouvernemental de sécurité alimentaire qui était censé fournir à la population des produits alimentaires importés bon marché.

La vacuité des mesures anti-corruption des banques de développement

Sacs de riz produits par BAB et distribués par EGAL Sprl

Il est déplorable qu’aucune enquête n’ait jamais été diligentée pour déterminer comment les banques de développement ont pu favoriser la corruption en finançant Feronia. Le fait qu’elles investissaient dans une entreprise sise aux Îles Caïman et détenue en partie par le bras droit du Président Kabila, quelqu’un qui a publiquement défendu la corruption parmi les hommes politiques de RDC, aurait dû suffire à tirer la sonnette d’alarme sur l’indice de corruption.

Aujourd’hui, même si Feronia a fait faillite et que ses plantations congolaises de palmiers à huile se trouvent entre les mains d’un autre acteur du capital-investissement - qui semble encore plus inepte et sans scrupules que Feronia - quelqu’un doit rendre des comptes. Si la « finance pour le développement » a un sens quelconque, alors les banques de développement qui ont financé Feronia et les gouvernements qui sont censés les superviser doivent se justifier.

par GRAIN | 18 mai 2021 | 










The untold story of Feronia Inc's failed rice operations in the DR Congo

The untold story of Feronia Inc's failed rice operations in the DR Congo

01/07/2021


Murder, land grabbing, indentured labour. These are some of the allegations that have been brought forward by communities in the DR Congo against the Canadian company, Feronia Inc, a company that received over US$150 million in financing from European development banks.


Most of these troubling allegations concern the company's vast oil palm plantations in Équateur and Tshopo Provinces that it bought from Unilever in 2009. But Feronia's initial years in the DRC also involved a large-scale rice farm and mill in the Bas-Congo that the company said would eventually save the Congo from its dependence on food imports.

By 2016, Feronia had sunk at least US$14 million into its rice operations before suddenly "discontinuing" its entire "arable division" in 2017 without explanation. A few years later, Feronia filed for bankruptcy and its oil palm plantations were handed over to a private equity fund in late 2020.

It has long been suspected that Feronia's arable operations were a front to channel funds to a high-level Congolese politician who facilitated Feronia's entry into the DRC. Allegations of possible corruption were well known when the UK's development bank, the CDC Group, and other development banks began financing Feronia. The company and the development banks denied these allegations and no serious investigation was ever undertaken.

New information discussed below provides further reason to suspect that Feronia's arable division may have been engaged in corrupt activities while the company was receiving funds from development banks. Will this be enough to launch a proper investigation of how development bank financing of Feronia may have contributed to corruption in the DRC?

Feronia's deep involvement with former President Joseph Kabila's closest advisor

When Feronia acquired Unilever’s oil palm plantation company PHC in 2009, it did so through a Cayman Islands company called Feronia JCA Limited. The "JCA" was in reference to Jean Collette Afrique SARL, a company entirely owned by Kikaya Bin Karubi, a high level politician, very close to the DRC President Joseph Kabila. He served as Kabila's Minister of Information from the time Kabila took power in 2001 until he was named Ambassador to the UK in 2009. In 2014 he was summoned back to Kinshasa where he became Chief Advisor to the President until Kabila's fall from power in January 2019.

When asked about the corrupt mining magnate Dan Gertler, 
DRC politician Kikaya Bin Karubi (above) told 
Bloomberg News: 
“We don’t want one Gertler, we want 10 Gertlers"

Through his company, Jean Collette Afrique, Bin Karubi held 20% of Cayman Islands-based Feronia JCA Limited. But only a year after Feronia's entry into the DRC, Feronia claims that it bought back Bin Karubi's 20% as well as a farm he owned just outside of Kinshasa, in Kasangulu, for a total of around US$2.2 million. He was also paid US$120,000 per year as rent for the use of his home in Kinshasa (while he was in London as the Ambassador) as well as fees for his service on Feronia's Board of Directors.


In 2012, Feronia claimed in a press release that it was growing mango, avocado and pineapple at this farm in Kasangulu but the farm was never mentioned in any of the company's financial reports or website nor was it part of Feronia Inc's bankruptcy proceedings in 2020. The farm, which the company says it acquired for around US$600,000, simply vanished from Feronia's books.

What Feronia referred to as its “arable” farming division revolved around another, larger farm near the town of Kimpese in the Bas-Congo region. This arable division was structured through Feronia's Kinshasa subsidiary, Feronia JCA Ltd SPRL, which oversaw three other DRC subsidiaries: Feronia PEK (the Kimpese farming company), Kimpese Agro Industries (the crop processing company), and Bas-Congo Ferti (which handled the purchase of fertilisers for Feronia's arable and palm oil divisions).

Figure 1. Feronia's structure in April 2014

The Feronia PEK farming business was 20% owned by Plantations et Elevages de Kitomesa, a local company that appears to be owned by the Tuluka family (a.k.a Yaya Groupe). Feronia's company reports indicate that Feronia acquired its 10,000 ha farm around Kimpese from the owners of this company, who were given a 20% share of Feronia PEK in return.

Company documents also show that Kinshasa-based Feronia JCA Ltd SPRL was managed by former Unilever plantation manager Raymond Batanga and was 20% owned by Bin Karubi until at least February 2014, when the company was disbanded and fused into the larger Feronia structure. This company was thus still in operation well after the CDC Group and the African Agriculture Fund (a Mauritius-fund managed by Phatisa and owned by numerous development banks) began investing in Feronia.

Africa Policy of the Federal Government: Millions for Despots


An investigation into company records for Feronia JCA Ltd SPRL obtained from the Kinshasa business registry uncovered numerous dubious expenditures, including unspecified payments for "services" and a second rental payment of around US$150,000 per year to Bin Karubi for an apartment at a different Kinshasa address than that of his house. Feronia made at least US$28 million in loans through this company and paid millions of dollars for "services" for reasons that were not made clear in Feronia Inc’s financial reports. When questions were put to Feronia about its loans to Feronia JCA Ltd SPRL by a team of German journalists, its CEO claimed that they were spent mainly on the construction of a rice mill in Kimpese and the preparation of the farmland undertaken by Feronia PEK. According to him, at least US$8.6 million was spent preparing the land and US$5.6 million building the rice mill.

Feronia made its first announcement of rice production at the Kimpese farm in 2011, saying that it had harvested on 1,200 ha but that yields were low. In 2012, it harvested rice on 305 ha and planted 140 ha of beans. That year it also completed construction of its rice storage and mill facility in Kimpese. The company proudly displayed images of the bags of rice it was selling with the Feronia logo on its website.

Bags of Feronia's rice



In 2014, Feronia declared that the assets of its arable division were worth US$7 million, and heavy spending on the division pushed losses to US$4.9 million for the year. But it was at this point that Feronia's enthusiasm for its arable division suddenly began to wane. In its 2015 annual report, Feronia stated that it had entered an agreement with an unnamed “partner” to conduct a 2 year feasibility study of its arable division and an "impairment test", which revealed a charge of US$3.5 million. The claimed losses on its books climbed to US$5.9 million, mainly because of this impairment charge.

In the 2017 annual report, Feronia booked another $2 million in losses for its arable division and announced that, following the feasibility study, it was discontinuing its arable operations. No explanation was given as to why. So much for what Feronia's CEO once called "one of the largest arable farming expansion programmes undertaken anywhere".

Enter Luc Gérard

Information obtained from the twitter account of Belgian-Congolese businessman Luc Gerard Nyafé suggests that his company, Strategos Plantations, became associated with the Kimpese rice mill in 2017 or earlier (see Box 1: Strategos Group). His tweets indicate that Strategos acquired the mill at some point prior to 2017 and began producing its own rice by 2018. It is not clear if Strategos also acquired the Kimpese farm. Nor is it known if the takeover of the rice mill took place before Feronia’s oil palm division received a US$49 million loan from DEG (Germany), FMO (Netherlands), BIO (Belgium) and other development banks.

Feronia's website from 2012 announcing the completion of the rice 
mill and the tweet by Luc Gérard from Nov 4, 2017: “End of stay.
 Agriculture: We are entering the Bas Congo by taking over an
 existing factory. And in Kwilu things are moving slowly. The
 road conditions and the permanent "taxing" of the
 Policemen, DMG and others, make the 
work difficult.”

GRAIN asked Strategos for clarification but they refused to comment. This was their response: "Please be informed that even though Strategos Plantations has had commercial relations with Feronia in the past, said relationships have terminated. Note further that we are not at privity (sic) to disclose the scope and/or extent of said business affairs due to confidentiality concerns."

What is clear is that Strategos acquired a mill reportedly worth at least US$8 million that was once owned by Feronia, without Feronia having registered any amounts for a sale of the mill in its accounts.

Strategos Group

The Strategos Group (registered in the tax haven of Delaware, US) is owned by the Belgian/Congolese businessman Luc Gerard Nyafé. He made his fortune in Colombia, where he teamed up with some well-connected local financial players to start a private equity fund (Tribeca) that got access to hundreds of millions of dollars from Colombia's state pension fund. He also received a Master's in Security and Defence from the Colombian War School. Gerard soon got into the mining sector, as well as privatised health care, and in 2015 he turned his sites to the DRC.

Gerard’s father was a coffee plantation owner in the DRC, and Gerard seems to have made some early investments in agribusiness in the DRC in the 1990s. But in 2015, he came back with much more force, founding the company Strategos Plantations, and taking over two of Unilever’s big plantation concessions and two farming operations (including, it seems, Feronia’s in Kimpese).

Luc Gérard on the cover of Forbes Africa; Luc Gérard Nyafé shaking 
hands with DRC President Felix Tshisekedi


Then, in 2018, with the election of Felix Tshisekedi, Gerard made a much bigger play. Tshisekedi made him an ambassador at large and one of his main advisors. He was handed the lucrative Maluku Special Economic Zone. He also formed a mining company, Compagnie des minerais strategiques (CMS) in Kinshasa in June 2019, to pursue the geological data for 17 mining projects in the DRC and Mali that he acquired in December 2018. In December 2020, Gérard was elected president of the Parti d'Union Républicaine, a recently formed national political party.

In 2020, Gérard claimed that Strategos sold the mill and its rice operations to Bio Agro Business (BAB), a Congolese company deeply involved in the agricultural projects of President Felix Tshisekedi. One of BAB’s team leaders is Raymond Batanga (the former manager of Feronia JCA Ltd SPRL). Another key player is the Italian agronomist Giovanni Mazzotti, who previously worked for the scandal ridden Senhuile project in Senegal.

Tweet from Luc Gérard on June 27, 2020: “No competition but complementarity,
 it is to BAB that we sold our Kimpese rice factory! We are handing it over to
 them to focus on corn!”

BAB has a distribution agreement for its rice with EGAL Sprl, a Congolese company that was accused of facilitating the disappearance of millions of dollars into bank accounts of former President Kabila's cronies through a government food security programme that was supposed to provide people with cheap imported foods.

Development bank policies on corruption are empty promises

Bags of rice produced by BAB and distributed by EGAL Sprl

It is a shame that no thorough investigation has ever been made into how development banks may have facilitated corruption in their financing of Feronia. The fact that development banks were investing in a company operating from the Cayman Islands that was part owned by President Kabila's right hand man, someone who has publicly justified corruption among DRC politicians, should have been enough of a red light on the corruption index.

Feronia may now be bankrupt and its Congo oil palm plantations in the hands of a new private equity player, who seems even more inept and ruthless than Feronia, but someone needs to be held to account. If "development finance" means anything, that accountability must rest with the development banks that bankrolled Feronia and the governments that are supposed to oversee them.

by GRAIN | 18 May 2021 |