September 21, 2012 / 7:28 PM / 7 years ago

Congo mining code changes must be consensual - business leaders

* Government seeks to review decade-old mining code

* Mining was key driver in 2011’s economic growth

KINSHASA, Sept 21 (Reuters) - A planned revision of Democratic Republic of Congo’s mining code must be done quickly and consensually or risk scaring off investors and stunting economic growth, the mineral-rich but impoverished country’s business federation said on Friday.

The government of President Joseph Kabila is looking to review the decade-old code, with key changes expected to focus on increasing state revenues from the sector.

Investors keen to tap into its under-exploited mineral wealth poured into the vast central African nation following the 2006 elections that were seen as drawing a line under decades of political instability and one of the world’s deadliest wars.

Economic growth hit a healthy 7 percent last year, largely driven by the expanding mining sector.

But the World Bank ranks Congo the sixth worst country in which to do business, and the Federation of Congolese Enterprises, its national chamber of commerce, warned that a poor handling of the review could affect investment.

“Despite all the difficulties and harassment and despite a business climate that remains bad, the efforts developed by the industry are starting to bear fruit,” the body said at the end of a two-day meeting to discuss the mining code.

“Non-consensual (changes) to the current mining code risk bringing to a halt current growth,” the statement added.

The government revisited all its mining contracts three years ago, a process that saw First Quantum lose its concessions. New owners ENRC later agreed to pay the Canadian miner $1.25 billion as part of a settlement package.

New Prime Minister Augustin Matata Ponyo has vowed to improve the country’s business climate after critics last year accused the government of selling off billions of dollars of mining assets at knockdown prices.

Congo is Africa’s second largest copper producer, exporting around half a million tonnes last year. It also possesses vast and largely untapped reserves of cobalt, gold, tin, and diamonds. (Reporting by Jonny Hogg; Editing by Joe Bavier and Bob Burgdorfer)

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