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Viewing cable 07KINSHASA674, SOUTH KIVU ECONOMIC OUTLOOK: MUCH POTENTIAL,

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Reference ID Created Released Classification Origin
07KINSHASA674 2007-06-18 10:34 2011-08-25 00:00 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Kinshasa
VZCZCXRO8122
PP RUEHBZ RUEHDU RUEHGI RUEHJO RUEHMR RUEHRN
DE RUEHKI #0674/01 1691034
ZNR UUUUU ZZH
P 181034Z JUN 07
FM AMEMBASSY KINSHASA
TO RUEHC/SECSTATE WASHDC PRIORITY 6336
INFO RUEHXR/RWANDA COLLECTIVE
RUCNSAD/SOUTHERN AF DEVELOPMENT COMMUNITY
RUEAIIA/CIA WASHDC
RHEFDIA/DIA WASHDC
RHMFISS/HQ USEUCOM VAIHINGEN GE
RUFOADA/JAC MOLESWORTH RAF MOLESWORTH UK
UNCLAS SECTION 01 OF 03 KINSHASA 000674 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: ETRD EINV ECON PGOV KDEM CG
SUBJECT: SOUTH KIVU ECONOMIC OUTLOOK: MUCH POTENTIAL, 
LITTLE INFRASTRUCTURE 
 
REF: 05 KINSHASA 1067 
 
1. (SBU) Summary: South Kivu, much like many other parts of 
eastern DRC, is an area of great economic potential with 
little means to realize it. Years of conflict, neglect, and 
mismanagement have turned the province into a shadow of its 
former self. Port facilities are in a state of disrepair; 
passable roads are nearly non-existent; and decades of war 
have ruined the region's industrial base. Provincial 
officials remain hopeful for a brighter economic future and 
talk of plans to revitalize the region. Their efforts, 
however, will be hampered by continuing insecurity and 
budgetary constraints. End summary. 
 
2. (SBU) Officials throughout South Kivu portray the province 
as a potential catalyst for eastern DRC's economy. PolOff 
toured South Kivu May 22-29, meeting with a variety of 
political officials and community leaders, who all expressed 
optimism that the province was on its way towards greater 
development and economic vitality. South Kivu in the past was 
a producer of agricultural goods including processed sugar 
and cotton, as well as a major point-of-entry for foreign 
goods. Years of conflict, neglect, and mismanagement slowly 
destroyed much of the province's economic capacity. 
 
------------------------------ 
ROAD REHABILITATION A PRIORITY 
------------------------------ 
 
3. (SBU) South Kivu Governor Celestin Cibalonza told PolOff 
in Bukavu that one of his main development priorities is 
rehabilitating the province's roads and infrastructure. He 
said rural development in particular will be key -- 
connecting the province's cities and villages with the 
provincial capital. Cibalonza said many areas, including the 
High Plateau region around Minembwe, remain cut off from much 
of the rest of the province. Such conditions, he said, stymie 
economic growth, leaving some communities little opportunity 
to engage in trade. 
 
4. (SBU) The province's roads are in a state of serious 
disrepair. South Kivu's main highway runs from Bukavu to Fizi 
in the south, though the only paved section is from the Lake 
Tanganyika port city of Uvira to the border town of 
Kamanyola, about 25 miles south of Bukavu. The remaining 
sections of the road, originally built in the Mobutu era as 
part of the Pan-African Highway, are little more than rutted 
dirt and boulder-strewn tracks. Many portions are often 
impassable during the rainy season. 
 
---------------------- 
AGRICULTURAL POTENTIAL 
---------------------- 
 
5. (SBU) Governor Cibalonza highlighted his plans for 
economic development and his desires to increase agricultural 
production. Without providing details on how he intended to 
do so, he claimed he wanted to make South Kivu a leading 
producer of goods such as sugar, cement, cotton and 
livestock. Cibalonza added that South Kivu also has 
significant mining potential, especially in gold. Uvira 
Territory Administrator Daniel Eloko echoed the governor's 
optimism, saying there was also a huge potential for 
commercial fishing in Lake Tanganyika. Eloko said the port in 
Uvira could also be a major source of revenue from trade 
along the lake. 
 
------------------------ 
OBSTACLES TO DEVELOPMENT 
------------------------ 
 
6. (SBU) Cibalonza's and Eloko's dreams of economic 
prosperity, however, face a harsher reality, as South Kivu's 
industrial base is almost non-existent, aside from a 
pharmaceutical company and a brewery, both of which are 
majority foreign-owned. A case in point is the former sugar 
refinery in the town of Kiliba outside Uvira. At the height 
of its production in the early 1990s, the plant reportedly 
employed some 5,000 workers and processed nearly 18,000 tons 
of sugar a year. According to the plant's current managers, 
the facility generated its own electricity, using the steam 
from burning sugar cane husks to power on-site generators. 
The Kiliba refinery closed in 1996, however, after the start 
of hostilities, and has not operated since. While much of the 
physical plant still exists, it needs a major overhaul. Plant 
 
KINSHASA 00000674  002 OF 003 
 
 
managers said it would require at least USD 17 million over 
three years to rehabilitate the entire facility. 
 
7. (SBU) Eloko's vision of a revitalized port in Uvira also 
faces obstacles. While the port always required regular 
dredging due to silting, it is the DRC's largest after Matadi 
in Bas-Congo province. Correctly, as Eloko himself admitted, 
the port barely functions. The only crane in use is the one 
owned by the World Food Program. Eloko said in order to make 
the port fully functional, the lake needs to be dredged, 
security measures must be put into place, and warehouses and 
docks must be built. Eloko estimated it would cost tens of 
millions to rehabilitate the port, and there is no sign of 
any money forthcoming to do so. 
 
------------------------- 
PROBLEMS IN MINING SECTOR 
------------------------- 
 
8. (SBU) In the mining sector, government officials admit 
corruption and security remain serious issues, and local 
government has little control. Cibalonza said he wanted to 
"clean up" South Kivu's mining industry and was looking into 
changing the province's mining authorities. He claimed as 
well that many mines are under the control of FDLR forces, 
who illegally exploit and traffic gold in the areas of 
Shabunda, Walungu and Misisi. Canadian Banro Gold has several 
exploration permits in South Kivu and adjacent Maniema 
province, but no industrial production is occurring. 
Artisanal gold and cassiterite mining are leading sources of 
income throughout the province, according to MONUC officials. 
PolOff saw several newly-dug cassiterite mines near the 
village of Lemera (an area with heavy FDLR presence), with 
several dozen men digging. Most vehicle traffic in the 
southern part of the province, according to Fizi 
Administrator Alfred Efoloko, is of trucks crammed with 
diggers heading to the gold mines near Misisi. 
 
--------------------------- 
SECURITY VERSUS DEVELOPMENT 
--------------------------- 
 
9. (SBU) South Kivu officials themselves are divided on how 
best to achieve conditions for economic growth and 
development. Cibalonza argued that improved security is the 
first priority, which could then lead to more investment and 
reconstruction. Eloko and Efoloko maintained that poverty and 
a lack of economic opportunities drive conflict. Eloko said 
that in the absence of jobs or constructive alternatives, 
many people -- especially young men -- are more apt to join 
militias and commit violence. Efoloko added that nearly half 
of the population in Fizi is illiterate, making it even more 
difficult for many to find sustainable employment. 
 
10. (SBU) Despite these challenges, most officials were 
upbeat about the province's prospects. Cibalonza said that 
even though his provincial budget faces serious constraints 
due to a lack of resources from Kinshasa, he intends to press 
for major development projects. Efoloko said he is encouraged 
by the recent return of some 40,000 refugees from Tanzania 
who can add to the human resources available in the province. 
He cautioned, however, that many returnees had become 
accustomed to life in refugee camps, where nearly everything 
was provided them, and have lost the desire to work. 
Nonetheless, he and Uvira Administration Eloko claimed there 
is a new "dynamism" growing in their communities, with signs 
of new construction and investment appearing throughout the 
province. 
 
------------------------------------- 
COMMENT: SOUTH KIVU'S WOES NOT UNIQUE 
------------------------------------- 
 
11. (SBU) Comment: South Kivu's economic difficulties are not 
unique in the Congo, as nearly all the provinces have been 
beset by violence, a lack of resources, degraded 
infrastructure, government neglect and overzealous and/or 
illegal tax collection. What sets it apart, though, is its 
significant unrealized potential, aided by its access to both 
East and Southern Africa markets. Provincial leaders 
nonetheless face significant obstacles in realizing greater 
development. The newly-formed provincial government has 
little capacity to manage the few resources it has and will 
receive little immediate support or financing from a 
cash-strapped central government in Kinshasa. Security 
 
KINSHASA 00000674  003 OF 003 
 
 
remains the biggest problem, however, in a region that has 
been the cradle of many of the DRC's wars and insurgencies. 
Without a durable peace, South Kivu will remain in its 
current condition. End comment. 
MEECE