Copper ran about 11 per cent ahead while electricity, beverages and port volumes stood nearly still.

By Kanisa Magazine · July 2023

By July 2023 the BCC’s own production table told two stories at once. Copper output in the first half ran about 11 per cent above the pace of 2022, while electricity generation, soft drinks, flour milling and port handling were all within a few points of last year’s rate. A country can post headline growth above 6 per cent and still hand its households a flat year, and Congo’s data show how.

The figures come from the BCC statistical digest of 26 July, which reports provisional output to the end of June 2023 beside full-year results for 2022. Comparing the half-year with half of the 2022 total ignores seasonality, but the gaps are large enough to read.

Mining pulled ahead of everything else

Copper tonnage kept climbing while the broader basket stood still.

Copper reached 1,326,109 tonnes in the first half, against 2,394,630 tonnes for all of 2022, which itself was about 33 per cent above 2021. That puts 2023 roughly 11 per cent ahead of the 2022 average pace. Cobalt told a different tale: 41,682 tonnes in six months compares with a 2022 half-year equivalent of about 57,700 tonnes, a drop near 28 per cent, consistent with producers reacting to a price that had halved.

Against that, electricity generation stood at 6,712 gigawatt-hours, about 1 per cent above the 2022 pace. Soft drinks ran about 2 per cent ahead, beer and spirits about 3 per cent, wheat flour about 1 per cent, and telephone minutes were level. Port handling at Kinshasa, Matadi and Boma slipped about 3 per cent. These are volumes, not values. The BCC’s Kinshasa retail index had risen about 23 per cent since December by the third week of July, so flat volumes at higher prices mean shoppers were paying much more for the same basket while sellers saw little growth in the number of units moved.

Power is the shared constraint

Mines absorb the new electricity, leaving little for factories and homes.

Power output that barely moved while copper tonnage jumped suggests that incremental supply is going to the mines first. That would be rational for a grid operator, since the mines take bulk supply and pay in dollars, and it fits the pattern in the BCC table: the sectors that need power and franc-paying customers are the ones that stalled. It is an inference from the numbers, not a finding the BCC makes. Coffee, up about 8 per cent, and cocoa, up about 20 per cent on the 2022 half-year pace, show farm exports can still respond when prices cooperate, but they sell abroad and add little to domestic demand.

Why the GDP print and the shop floor diverge

Growth in a dollar-priced, capital-intensive sector spreads slowly into franc incomes.

The BCC’s provisional national accounts put 2022 growth at 8.9 per cent and its 2023 figure at 6.6 per cent. The World Bank’s Albert Zeufack, speaking in Kinshasa in January, gave a lower 6.1 per cent for 2022 and said growth was driven by a commodity price upswing as well as better macroeconomic management. The two estimates differ, but both attribute the lift to extraction.

The transmission to households is thin for three reasons. Mines import most of their inputs and pay many suppliers in dollars, so little of the spending turns over in francs. Employment per dollar of output is low. And the state captures part of the gain through royalties and taxes, which feed a 2023 budget of CDF 32,457 billion, about US$16 billion, only as fast as the Treasury actually pays.

What business should do with this

Sell to the mines’ supply chain and to power, and price consumer lines for flat volumes.

A consumer-goods company should plan for flat unit volumes in 2023 and defend margin through price discipline rather than expect a mining dividend to arrive in the till. A supplier of equipment, maintenance, logistics or camp services to the copper belt faces the opposite environment: demand is rising with tonnage.

The sharper opportunity lies in electricity. Captive solar, hydro and efficiency projects serve both camps, easing the constraint that the production table makes visible. Congo’s growth will broaden when power does.