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ERA ALERT
A news alert from Executive Research Associates (Pty) Ltd

Issue 79 12/2/2018
DRC FACES TOUGH 2018 AS PRESSURE MOUNTS FOR KABILA TO RESIGN
Instability in the DRC looks set to continue in 2018 after the year got off to a volatile start with a demonstration on New Year’s Eve 2017 that saw the killing of 12 people with another six left dead during 21 January protests demanding that President Joseph Kabila ‒ whose term of office expired over a year ago ‒ should step down. The security forces have been predictably heavy-handed, doing little to calm the national mood. Compounding this overtly political violence, February has also seen a flaring in inter-ethnic violence in the embattled Ituri province, where at least 23 members of the Hema ethnic group have reportedly been killed since 2 February

Kabila’s repeated failure to commit to an election date caused political gridlock in the country in 2017 and widespread uncertainty remains about his intentions. There has been some positive momentum in that an election date of 23 December 2018 has been set, funding for the election has been secured, and the DRC’s electoral commission confirmed 46 million voters had been registered ‒ 12% more than expected. However, the DRC’s main opposition groups have rejected the new electoral calendar and speculation is rampant that Kabila still intends to hold a referendum to amend the constitution to let him run for more than two terms. With the official position on Kabila’s plans vacillating frequently, clarity might have to wait until at least July ‒ the date set down for power contenders to declare their candidacy. Should Kabila indeed push forward, electoral progress and integrity will benefit little and dictatorial and repressive governance will intensify. This will fuel the state’s downturn under Kabila, who has tightened control of state finances and key institutions, helped by a weakened opposition after the death of key leader Etienne Tshisekedi and dwindling international attention.

Besides the erosion of security and stability, Kabila’s intransigence has fomented a stark deterioration in the economic and socio-economic environment. Last year the Congolese Franc lost half its value; the country saw a spike in fuel and food prices and the inflation rate ended on 41.7%. Persisting instability and policy uncertainty will sustain the pressure, exemplified by parliament’s January 2018 approval of a new mining code, which could see cobalt royalties rise five-fold to 10%, and the removal of a current law which protects miners. The critical mass of violence, economic strains, and policy and political uncertainty means that the national operating environment remains onerous and investor sentiment highly guarded.

While regional and international intervention may be vital, it has to date failed to yield significant positive results. In late January 2018 it was reported that secret meetings took place in Davos and later in Addis Ababa between Rwandan President Paul Kagame and DRC opposition leaders Moise Katumbi and Mbusa Nyamwisi, where Kagame reportedly assured the two opposition leaders of military and political support. The exact terms of the support remain unclear, but it is rumoured that Kagame’s agenda is to further weaken the DRC to serve his business interests, by covertly benefiting from the DRCs natural resources through proxy militias, looting and smuggling.

While international bodies such as the International Federation for Human Rights have accused the authorities of crimes against humanity, regional powers, including South Africa, the Southern African Development Community (SADC) and the African Union (AU) have been accused of ignoring the bigger picture in the DRC. While the AU was seen to take a strong lead at the start of the electoral crisis, it appears that SADC is now taking the lead, which could prove problematic as SADC has historically sided with Kabila.

Continued uncertainty and instability suggests that the DRC will remain a high-risk prospect climate, with no marked improvement in conditions anticipated without substantive external intercession. In this context, the next few months could prove crucial in defining the extent to which the country is able to avoid further backpedaling.

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