Kinshasa - DR Congo state-owned mining company Gecamines said Thursday that key indicators were flashing “red” owing in large part to “serious management errors.”
“All indicators are red owing to weak production which is mainly the result ... of serious managment errors” related to the launch of a factory, a company statement said.
Another issue was “the ill-considered halt of out-sourced work following a murky contract for the purchase of used mining equipment,” it added.
In late July, Democratic Republic of Congo President Joseph Kabila fired the chief executive of Gecamines, Ahmed Kalej Nkand, after the management problems emerged.
The company is active in the production of copper and cobalt in DR Congo, the world's leading source of cobalt, which is a key element in high-strength metal alloys.
An internal probe “provided irrefutable proof of the central role” played by Kalej Nkand in the group's problems, and legal action has not been ruled out, the statement said.
He is accused in particular of having bought 73 pieces of used mining equipment in doubtful circumstances for much more than they were worth.
Forty years ago, Gecamines was the goose that laid DR Congo's golden eggs, accounting for more than half of the country's revenues.
Wars that ravaged the country from 1996 to 2003 took a heavy toll on both the country and the company however.
Gecamines' most prized mines were sold to private investors at bargain basement prices to fill state coffers, with the publicly-owned company retaining only minority holdings.
In 2010, new management was brought in to turn the group around and prepare it to compete on the global stage.