Albert Yuma Chairman of the Board of Gécamines
Mining and Business Magazine met Albert Yuma, PCA of Gécamines. He delivers his truths in an open-hearted interview. secteur pétrolier.

MINING & BUSINESS MAGAZINE: Albert YUMA, we talk a lot about you, but we don't know you very well. Who the hell are you?

ALBERT YUMA : I'll be 63 soon. I was born on July 30, 1955 in Kongolo in Tanganyika. I spent most of my schooling in Belgium where I also studied at university and graduated from the Catholic University of Louvain in Economics, Labour Sciences, and Financial Management.

Then, I started my career with the TEXAF group of which I am still president and of which I was general manager. TEXAF is today a financial company in which I am a shareholder; it was a textile production company in the past, but has ceased this activity because of Chinese competition. Since then, I have personally taken over the clothing business via my company, TEXICO.

For 14 years now, I have been President of Congolese employers and I have had an international career in business. I headed the CPCCAF for four years, I am an administrator at the ILO, where I represent employers in Central Africa and, since 2017, President of "Business Africa", which is the grouping of all African employers. I have also been Chairman of the Audit Committee of the Central Bank of Congo for 14 years.

MB : You are however known all over the world for your functions at Gécamines !

AY : No ! No ! I am first and foremost the boss of the Congolese private sector. If I was called by President Kabila, it was to give the GCM private management  it is very clear ! And I hammer it constantly: I do not have vocation to remain with the GCM. I came here to reform it, to revive the mining company that it was no longer. Gécamines was considered dead, we didn't even talk about it anymore! My ambition is to put her back in the spotlight. In April 2010, the World Bank issued a report recommending that the Congolese Government close Gécamines. That's when I was called in. I accepted the mission, but refused general management; to be PCA. My mission is to give impetus, to structure, to give a vision, but not to be an operational !

Anyway, people are wrong! First of all, I'm a private operator... coming to the GCM.

MB: You announced at the DRC Mining week a reorganization of Gécamines. What's going to happen?

AY : CMG has three priorities: one, reform. We commissioned an organizational audit of the company. Secondly, finally being able to really benefit from partnerships and thus renegotiate them. Third, to invent new forms of collaboration in our future partnerships, by developing the production sharing system that comes from the oil sector. Gécamines will no longer have the minority joint ventures it has today. These are the three axes, recalling that this strategic orientation follows the results of three years of Audit and economic and financial modelling of the results of all our JVs.

MB: Why did you take so long? It took three years?

AY : Yes, three years. First, there was resistance from the majority partners who did not want to give access to the documentation (smiles); we had to force and push. And, you saw, in the case of KCC, we went as far as the judicial procedure suspended following their decision to want to negotiate. I started this audit because, as I told you, the World Bank had recommended closing, but regardless of that opinion, Gécamines had to be liquidated!

At the time, the company had nearly 12,000 workers for a production of 10,000 tons per year! She had a liability of a billion and a half dollars... It was no longer a company, it was a museum! A museum because the last investments were made over 45 years ago. There is no longer a single mining company that uses this type of equipment. Mining is not cooking: you don't make good soup in old pots! Museum also because the average age of the staff was 59 years! With this cocktail, you couldn't hope to run a business.

In November 2010, when I was appointed, the government was going to assume the financial liability, but in the end it did not. He couldn't afford it and I don't condemn him. So we had to find a way to survive while we waited to recover the income we had been promised.

As a bonus, international donors had said to the Congolese government: "Give your deposits to foreign partners, they are more qualified than you to manage them and you will get dividends for the profits".

MB: So they were telling you: "Turn CMM into a Portfolio company"?

AY: Exactly! Stop production, you are not capable and you no longer have any equipment or deposits. And it was actually a truth! Since 2000, CGM has sold more than 32 million tons of copper and nearly 3.5 million tons of cobalt in partnerships. GCM kept only two old mines with a maximum potential of 500,000 tonnes. It's a miracle we're still alive ! with a clear future ahead of us. And if I accepted this mission, it was because I too was revolted that a sovereign State had been told to liquidate the mining flagship that was the CGM, which represented 70% of its revenues. It was the Head of State who refused and asked me if I could accept this mission to turn the company around.

MB : It is indeed useful to redo a little history!

AY : Workers had nearly 14 months of back pay. We paid them three or four times a year. Today, they are paid every month and we are only 6 months in arrears by paying every month and gradually clearing the arrears.

MB: How many employees do you have today?

AY : About 8700. Because, in parallel, we have launched a social plan, with the agreement of the unions, to reduce the workforce. 2279 people have already left the company with, for the first time in a company of the Portfolio, the total compensation provided for both by law and by the collective agreement.

MB: When was this done?

AY: Since 2015 and fully funded by the GCM, now $42 million, with no government or other assistance. I remind you that under the leadership of the World Bank, the GCM had already offered a voluntary departure to 10,000 people with packages, but they were never paid their final legal statement...

MB: That was World Bank financing?

AY : Yes, but these were flat rates and the final settlements were not paid. There's a lawsuit against the BM. Some people left 41 months late... We told them: we can no longer pay you... The World Bank gives you a package to leave. Take it or leave it!

Today, we are working with the unions and agreeing on a payment deadline. All workers have been paid in full; senior managers are paid in instalments, but in full under the collective agreement.

As far as employees likely to retire are concerned, they can and must now leave, it is legal. But others are now less tempted to leave society despite the incentives, because they see it restructuring and we pay salaries with more regularity.

MB: Still in that DRC Mining week speech, you explained that you had an ambitious program to increase the company from 8500 employees to 3200. Is that correct?

AY : Yes, but without breakage ! This is the result of an organisational audit carried out by EY which concluded that the GCM structure is totally unsuited to international competition because of its overstaffing, obsolete equipment and management model. Elderly staff, overly hierarchical structure, administrative burdens that prevent efficiency, etc. We're going to transform this company - and it's a revolution! - into a modern company by eliminating hierarchical levels and really bringing decision-makers closer to production. We will create business units and remove unnecessary management.

Listeners interviewed about 100 executives. They worked with everyone, including the unions. The originality of the approach is that we keep only 3200 people operational, 2000 in what we will call social activities (schools, clinics, hospitals...) which may eventually be sold, and 3000 in an operational reserve.

MB: What is an operational reserve?

AY : The operational reserve is workers who will no longer have a place in the new organisation chart, but who are still of working age and who can probably be integrated in future projects, such as the Deziwa project for example.

This is part of the agreements with our partners. In this unique agreement, GCM will recover the entire deposit company within ten years. Therefore, the partner must recruit first from the CMG operational reserve. So out of the 3000, we are almost certain that two thirds will find an industrial job within 24 months.

MB : What kind of jobs is it? Technicians? Mining engineers?

AY : Yes, but also a lot of enforcement staff of the Kolwezi factories that have been closed for example, and also of the administration linked to our old organisation, but which no longer have their place in the new structure. We eliminate hierarchical levels, and we only keep what will be comparable to most companies, to the size of TFM, or KCC for example. However, there, we have at least 5,000 too many people, including 2,000 we are obliged to keep, because we have a historical social obligation. Did you know that all hospitals in Katanga belong to the GCM?

MB: That, you did not plan in the long run to privatize it?

AY : There are three options on the table. Either we make it an autonomous foundation in which we put the initial funds - hoping that it will have external contributions to make it work. Or, we are looking for private partners interested in taking over some of these activities. Last option, we have approached the two governorates of Lualaba and Upper Katanga to see to what extent they can resume these activities. In two years, the question will be decided.


MB : Let's go back to the future of the staff in the operational reserve? They'll all eventually be involved in a JV?

AY : A JV or a company owned by us, such as Kingamyambo which will be the first new plant built by GCM.

MB: With a Chinese general management, for example, will these people have to meet Chinese standards? What are we gonna do with them if they don't perform?

AY : We are not going to impose anything on our partners, all the more so as we are the ones who eventually take over the company, so we must give it the chance to achieve its objectives. It is very clear, the partner will take, I apologize for the term, the best... And those who cannot be taken will have their final count.

MB : So there will still be some "breakage"? And it's already negotiated with the unions?

AY: Unions were the only ones involved in the process! And the three senior stewards have always attended boards of directors.

MB: I come back to what happened with KCC. Were you really ready to go all the way?

AY : If we had not reached an agreement, we would go to the dissolution. They were scared, but finally, KCC understood his interest.

MB: So you hit really hard starting with the biggest one! And they're all gonna die?

AY : I think it will be done on an amicable and voluntary basis, but we will indeed review them all, because the results of the audits are there and it is clear that no partner has behaved well with the GCM.

One of the biggest reforms we're making is the new CMG Holdings Branch. We want the Investments Department to be the point of contact for enforcing agreements and partnerships. The first symbolic gesture in this direction is the construction of a new building in Lubumbashi whose work has begun. We will recruit top-level executives, engineers and financiers who will have a working tool commensurate with our ambitions.

I recently received about forty young Congolese executives from all our partnerships to talk to them about our future. Most of them had left CMG because there was no future, the others having started their careers directly in the partnership. They explained to me that they had been attracted by better financial and material conditions. And that they are ready to rejoin the CMG if we reassure them on these two points.

MB: You arrived in 2010, and the first audits took place in 2015, why did you wait 5 long years?

AY : One, I had to get to know the mining sector myself. Two, audits are very expensive, and money has always been the weakness of the Congolese state. Three, most partnerships were systematically in renewal of investment. Finally, GCM was obliged, in order to survive, to sell the non-strategic assets.

MB : Like real estate in Brussels?

AY: (...) This case is really ridiculous. This new company is managed according to the most modern rules and the most total transparency. But again, our financial difficulties are real, and we are the portfolio company that contributes the most to the Congolese state with tax advances... by continuing to pay salaries every month! The GCM described from the outside does not exist! And when NGOs claim millions have disappeared, they prove it by adding apples and pears!  

MB: So why don't you prove them wrong?

AY: But I did it! In writing!  

MB: Really every time? With the Carter Center, for example?

AY : Yes  And they could never react to our positions !

MB : GCM has just recovered 150 million, you already know what you are going to do with it?

AY: All right! The money will contribute to the execution of our transformation plan. Everyone thought I was crazy to dare to fight Glencore, and I won the game, I got 150 million, but it's "peanuts"! CMG's needs go well beyond;

MB : What about production objectives?

AY : It was difficult to make them with the equipment we had and yet we invested. But one of the findings of the audit is that investing in this old equipment is a waste of time. Do you realize that we had come to produce at costs close to 10 000 USD per ton of copper when the copper price was at 4000 ! That's $6,000 loss per ton produced! But we didn't stop because of our social obligations. You know, here in Katanga, it's known, when the GCM pays everyone with a smile and the bars are full!    And then there are the 35,000 schoolchildren and students, the GCM plays an indispensable role from a social and educational point of view.

MB: 35,000 school children...?

AY: 35,000 children of staff whose school fees are all paid by the company. I am a private sector manager, so we are going to rebalance the company and start with an initial production phase of 30,000 tonnes this year, to reach 75,000 tonnes in three years, but in the larger structure that we keep.

MB : On the three sites you were telling us about?

AY : Yes, which is grouped into a single business unit for which $64 million has been invested since mid-2016, with a single manager from the mine to the metallurgical unit and to which a modernized plant is being handed over to increase copper quality. Because in addition to producing at a very high cost, we offered a product of poor quality, which had a discount on sale! Today, for example, CMG copper is being discounted by nearly 20% due to its poor quality. We were the only ones in Katanga who didn't have SX.

People think there's a lot of income... and there's nothing to hold on to! But still, she's holding, and tomorrow she'll hold more! Already, thanks to our efforts, we produce without losses! Moreover, in the agreement with KCC, people only saw the 150 million, but nobody saw that thanks to the revision of the borrowing rate, and the cancellation of a large part of the debt, as of next year, it is 200 million dividends per year for GCM, and this over the next ten years.

MB: This will make it possible to renovate the headquarters in Kinshasa?

AY : I guess it's also said that I already sold it to the Chinese to make a hotel, like in Lubumbashi when the work started! More seriously, the headquarters in Kinshasa, the SOZACOM building, will be renovated within 5 years. The floor occupied by the Board of Directors has already been renovated. We cannot deal with international partners or banks in unhealthy buildings; I do not accept that. The new mining code also requires all foreign investors to build a head office to international standards.

MB: Have you discussed this with President Kabila?

AY : Yes, we discussed it with him when he came to the inauguration of the new headquarters. He said to me, "Yuma, why don't all these strangers build? "That's where the idea started.

MB: You have been one of the kingpins of this new Code...

AY: Absolutely! Based on the audits, I could inform the government that the mining code had been too favourable for foreign mining companies and that reform was needed. But that was the will of the Government and the Head of State because the population was growling. We see trucks leaving with minerals, holes that remain on the ground, and there are no roads or hospitals, nothing new... We wonder where the money is going. The World Bank acknowledged in 2016 in a report that the 2002 mining code had been too advantageous for foreign investors at the expense of the local partner, the GCM. The contribution of mining companies was the lowest of all Sub-Saharan African countries. This is serious!

MB : A question on subcontracting. Do you not think that this law remains too vague?

AY : I have worked hard for the adoption of this law, but it is true that certain aspects can be enriched. One of the things the audit showed us was that many of the companies in the majority of partnerships were subcontracting within groups. Another source of money evasion. There would be no local businesses with the capacity to manage these services! That's a great excuse. So this legislation was essential, but I agree that the implementation measures must be clarified. The FEC has written to the Government asking for a joint commission to address the applicability of certain measures. That said, we had to have this law.

MB: In Katanga, the Chinese seem to have developed the habit of working only among themselves, because of the language barrier. How can a young Congolese entrepreneur access this market?

AY : This is very important. And the Chinese cannot evade the law. I also insisted that Chinese companies be subject to the new Code. Language should not be a barrier. The requirement of at least 40% subcontracting must be applied and beyond.

We, for example, have included in the partnership contract with CNMC, in which we hold 49% of the capital, and the Chinese company 51%, that it is Gécamines, as a partner, which will entrust the FEC with the task of allowing as many people as possible to apply and become subcontractors (...).

MB: What if I say "traceability" of Gécamines' accounts?

AY : If GCM is alive, could have invested hundreds of millions of dollars, it does not come from the State. It's not from any bank. The government that is supposed to fund has never donated a dollar, but we have contributed more than $524 million to the government between 2009 and 2016. You know, everything's traced. Carter Center says that between 2011 and 2015, 750 million out of 1.1 billion partnership revenues were lost, while our accounts show that the 865 million received are there. This is confirmed by our auditors mandated by the State and by external auditors who are part of the big four, and moreover all our flows are controlled, since they pass through the Central Bank. Everything is perfectly traceable.

MB: Some NGOs talk about your personal enrichment. You don't seem too impressed with money, though.

AY : Absolutely not. All the assets I have, I had before I came to CMG, because I come from an entrepreneurial family. My father, who is 86 years old, was the first Zairian private businessman to have an airline, and was a member of Parliament. I studied in Europe at my parents' expense...

Gécamines' reorganisation is a considerable financial challenge when one takes into account the state in which the company finds itself. The ambitious Transformation Plan that we have established and are implementing will provide a future for CMG by repositioning it on the international mining scene. It is also a personal challenge for the general interest of my country. That explains my strong involvement.


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