Saturday, May 18, 2024

US Explores Easing Sanctions on Israeli Mining Magnate Dan Gertler

SATURDAY MAY 18 2024

Artisanal miners work at the Tilwizembe, a former industrial copper-cobalt mine, outside of Kolwezi, the capital city of Lualaba Province in the south of the Democratic Republic of the Congo on June 11, 2016.

By JAMES ANYANZWA

The US Treasury Department is exploring a limited easing of sanctions on Israeli mining magnate Dan Gertler to facilitate his exit from the Democratic Republic of Congo, a US official said on Thursday.

The US Treasury imposed sanctions on Gertler and more than 30 of his businesses in December 2017 and June 2018, accusing him of leveraging his friendship with former DR Congo president Joseph Kabila to secure lucrative mining deals.

“We are working to support the Government of the Democratic Republic of the Congo ... as it endeavours to remove corrupt actors from its mining sector,” the official said.

“We have indicated that we are open to exploring limited sanctions relief as a conduit to the complete removal of Daniel Gertler and his business operations from DRC.”

The Wall Street Journal reported on Thursday that the Biden regime and DRC government had proposed reducing sanctions on Gertler in exchange for his permanent exit from the country and said the Congolese government presented the plan to Gertler earlier this week and is awaiting his response.

The official said Washington's goal was to facilitate the removal of significant assets from Gertler’s control and that any potential sanctions relief would need to be subject to strict guardrails, including provisions that would facilitate the snapback of the measures.

The official made clear that Gertler remains under US sanctions “for his corrupt actions” and that his assets remain blocked.

Washington was seeking to support Congo’s efforts to improve transparency and economic opportunity in its mining sector and diversify critical supply chains to increase global security and prosperity.

The US has previously said mineral resources in Congo and Zambia were essential to meeting enormous global demand for clean energy components and power infrastructure to support the growth of artificial intelligence.

Aggressive Chinese investment across Congo, Zambia and elsewhere in Africa has raised concern in the US.

Under the plan, which has angered human rights activists and some government officials, Gertler will sell off his remaining stakes in three giant copper and cobalt mining operations in DRC.

According to media reports, Mr Gertler, would, in exchange, receive a “general licence” from the US that would broadly reopen international financial markets to him worldwide.

But if he is accused of corruption again the full sanctions could be re-imposed.

The proposed deal comes as US plans to impose tariffs on an array of Chinese imports, including electric vehicles and advanced batteries as part of a wave of protectionist positioning by both Republicans and Democrats.

According to the New York Times, a framework has been presented to Mr Gertler’s lawyers in the past week that would allow him to cash out of his stakes in Kamoto Copper Company and Mutanda Mining, both primarily owned by Switzerland-based Glencore and Metalkol RTR, which is owned by the government of Kazakhstan.

These three mining operations produce 30 percent of the world’s supply of cobalt, which is an important ingredient in longer-range electric vehicles because it helps to give the batteries the ability to hold more of a charge.

They are also major global sources of copper, a metal increasingly in demand as the revolution in artificial intelligence is prompting the construction of new data centers filled with copper wiring.

Mr Gertler no longer has a formal ownership in the Glencore mines; the company bought him out in 2017, but he is still paid royalties on cooper and cobalt production at these facilities, according to the New York Times.

It is estimated that cumulatively Mr Gertler’s business entities now earn about $110 million a year in royalty payments from Congo.

No comments:

Post a Comment