by John Lasker Tuesday, October 6, 2015
Deep within the eastern Democratic Republic of the Congo (DRC), in a mountainous jungle that is home to volcanoes and silverback gorillas, lies a mining region like no other. The ore pulled from the ground here helped the U.S. build the atomic bomb and supplied the Western world’s technology revolution of the 1990s and 2000s, which brought consumers devices like the mobile phone and laptop computer.
This proverbial gold rush, however, has come at a cost. Over the last 25 years, an estimated 5 million to 7 million Congolese have died in a series of conflicts over ethnic rivalries and land disputes. According to the United Nations (U.N.), the violence is being financed by the DRC’s abundant mineral resources, such as gold, tin, tungsten and tantalum, which are needed for technology. Most of the violence has occurred in the eastern DRC in the provinces of North and South Kivu. Brutal militias have dominated the quarter century of fighting, using slaves and children, and forcing “artisanal miners” to mine the mineral resources. These mineral resources are then smuggled out of the DRC to Uganda and Rwanda, from where they are eventually sold into the supply chains of multinational companies, often unknowingly.
As with the infamous conflict diamonds also mined in this region, the plight of the eastern DRC related to conflict minerals has gained attention among Western consumers. As the West became more aware of how the diamond trade was financing brutal wars and human rights abuses in Africa, consumers began demanding more transparency in that industry. Likewise, now, the U.S. and several other nations, along with a number of nongovernmental organizations (NGOs) and multinational technology corporations such as Intel and Apple, are striving for transparency to eliminate conflict minerals from the supply chains of many consumer products. And while some experts say the situation on the ground in the DRC is improving due to these efforts, others say there’s still a long way to go.
The DRC has an estimated $24 trillion worth of untapped mineral deposits, including 45 percent of the world’s reserves of cobalt (the world’s largest reserve) as well as significant portions of the world’s copper, diamond, tantalum and tin deposits, according to the U.S. Geological Survey (USGS). In 2012, the DRC produced 55 percent of the world’s cobalt; 21 percent of the global production of industrial diamond and 5 percent of the world’s gem-quality diamond; 12 percent of the world’s tantalum; 3 percent of the world’s copper; and 2 percent of global production of tin.
By 2014, the DRC was the world’s second-leading producer of tantalum, according to Thomas Yager, the DRC country specialist for USGS. Shadowed by two volcanoes (Mount Nyiragongo and Mount Nyamuragira), the eastern DRC is rich in igneous rocks that host deposits of coltan — short for columbite-tantalite —a black metallic ore from which tantalum is recovered.
“Coltan is found in granite or pegmatites associated with granites — these are primary deposits,” Yager says. Additionally, “quite often coltan is mined from alluvial deposits,” from which it is relatively easy to extract because such deposits are close to the surface and are composed of gravel rather than bedrock, he says.
Coltan is one of the most coveted Congolese resources because of tantalum, which conducts heat and electricity very well and is also very resistant to corrosion. It is mostly used in powdered form for manufacturing miniature tantalum capacitors. Just a tiny amount of tantalum is needed to achieve a high capacitance, making it ideal for mobile phones and other personal electronics.
“The ‘smarter’ your phone or tablet is, the more it needs tantalum because tantalum capacitors are the smallest and most reliable instruments to make your text messages, your email functions and app functions work,” says Sasha Lezhnev, a senior analyst with the Enough Project, a Washington, D.C.-based NGO working to end genocide and human rights atrocities in Africa. “Without tantalum you’re going to get large bulky products that don’t work as well,” Lezhnev says.
But the DRC’s history with conflict minerals didn’t start with tantalum. It started with uranium back in the 1940s. In 1939, Germany’s National Socialist Party was secretly trying to acquire uranium for atomic bombs, but the U.S. Army, tipped off by Albert Einstein, beat them to the best source. The Manhattan Project used pure uranium ore from what was then the Belgian Congo to manufacture atomic bombs.
The mine where the uranium originated is located in the eastern DRC, near the town of Shinkolobwe. In 1960, when the Belgians left the Congo, they closed the Shinkolobwe mine, flooding the shafts and sealing the entrance with a slab of concrete. With independence, however, came corruption and greed. An inept government took control in the capital of Kinshasa. Law and order broke down, and mines like Shinkolobwe became fair game. Over the years, political stability hung by a thread in the DRC. In 1994, in the aftermath of neighboring Rwanda’s genocide between the ethnic rivals Hutus and Tutsis, 2 million refugees poured into the eastern DRC.
The exodus further destabilized the region into a morass of ethnic animosity, warfare, national hegemony and blatant theft. Shortly thereafter, regional militias and neighboring rival militaries began taking over the eastern DRC and pillaging minerals. What followed in the eastern DRC is what some called “Africa’s World War,” as nine African nations and some 25 militias became embroiled in the combat.
As the war raged on, the United Nations began to realize that billions of dollars worth of minerals were being smuggled out of the eastern DRC. In its 2003 report, “The Illegal Exploitation of Natural Resources and Other Forms of Wealth of the DRC,” the U.N. noted that some of the most active thieves were the neighboring countries of Rwanda and Uganda and their militias, along with, unwittingly, a number of Western-based mining companies, metal brokers and metal processors. The U.N. stated in 2010 that in the Kivu provinces of the eastern DRC, “almost every mining deposit was controlled by a military group.” And in 2013, the U.N. accused the DRC’s own military of smuggling gold and tin.
As prices of resources like tantalum rose, so did the scale of the smuggling operations. Over the past 15 years, prices of tantalum have fluctuated from $30 per pound to $275 per pound, with current prices about $110 to $120 a pound. Nevertheless, once Western governments and companies became aware of the smuggling and the violence waged by the smugglers, changes quickly began to be implemented.
In 2010, following the financial crisis of 2008, the U.S. Congress passed the Dodd-Frank Wall Street Reform and Consumer Protection Act. Quietly squeezed into Dodd-Frank was Section 1502, a law requiring any company registered on a U.S. stock market to conduct due diligence to determine if its supply chains were using conflict minerals from the DRC, and to publicly declare any such mineral resources. Under the law, the companies are not forced to stop using the resources — they just have to file special disclosures with the Securities and Exchange Commission (SEC) describing their sources. Congress and some Congolese activists proclaimed that Dodd-Frank Section 1502 would soon financially cripple the militias of the eastern DRC.
The U.S. Chamber of Commerce and a number of multinationals argued, however, that costs are simply too high to establish fully transparent supply chains, and continue to challenge Section 1502 with lawsuits filed against the SEC. The SEC refused to comment for this story due to the ongoing litigation. Nevertheless, the first filing deadline for Dodd-Frank was in June 2014 and more than 1,300 companies submitted reports to the SEC. Dodd-Frank has forced U.S. companies to demand transparency from mineral suppliers, and encouraged them to purchase from sources that have proven to be conflict-free. In 2014, 21 companies, including giants like Intel and Apple, claimed they were DRC conflict-free by sourcing from 16 certified mines in the DRC. In 2011, there was just one such conflict-free mine.
In a joint statement posted on Intel’s website, Intel and the Enough Project reported that Dodd-Frank Section 1502 and other traceability efforts had resulted in “a 55 percent reduction in armed-group profits from tin, tungsten and tantalum mined in the region.”
As the militias' profits took a hit, defections from the militias soon followed, says Enough’s Lezhnev, who has spent months on the ground in the eastern DRC investigating mines. “That’s very significant,” he says. “If we did not have Dodd-Frank, all these armed groups that are giving up would still be running many, many of these mines. The general trend is positive. This economic component [in the fight against conflict mineral smuggling] was missing for years in the DRC.”
However, U.N. investigator Dan Fahey, currently a visiting scholar at the University of California at Berkeley, says that there isn’t enough credible information coming out of the DRC to back the positive reports about cuts in profits and defections from militias. “It’s too early to say anything about Dodd-Frank,” Fahey says. Fahey’s report for the U.N., published in January, stated: “While there has been progress on traceability and due diligence efforts concerning minerals produced in the DRC, smuggling continues. Efforts to negotiate the disarmament of [armed groups] failed to produce meaningful results.” Really, Fahey says, there are so many unknowns with respect to Dodd-Frank, especially about potential unintended consequences such as possible negative impacts on the legitimate livelihoods of artisanal miners, that “I think it’s too early to call it a success and too early to call it a failure.”
Questions have also arisen about the effectiveness of traceability and certification efforts. For example, many Congolese activists say that far fewer mines have been certified than touted. According to a public letter released in 2014 by 70 Congolese activists and experts, only “a small fraction of the hundreds of mining sites in the eastern DRC have been reached by traceability or certification efforts.” And at one mine hailed by Western NGOs as “conflict-free,” the 70 activists wrote, “the mine still suffers from the sporadic influence of armed actors.” An investigative report last year by the Washington Post indicated that in South Kivu, only 11 mines out of more than 900 are conflict-free.
Identifying the number of mines in the eastern DRC that have been certified is challenging. Mining expert Murray Hitzman, a geologist at the Colorado School of Mines who conducts research in the DRC, says most tantalum ore is mined by artisanal miners at these uncertified sites. The challenge in terms of tracing it, he says, is that much of it is then smuggled out of the country by militias and sold to middlemen who ship it to smelters.
Obviously, not a lot of reporting gets done here due to the ongoing civil war in that part of the DRC," Hitzman says. “In some cases, [the militias] try to export to an area where the ore can be certified, as if it came from a certified mine.”
The traceability efforts that do exist in the eastern DRC begin upstream on the mineral supply chain with artisanal miners at NGO- or DRC-government-certified mines. Also helping certify eastern DRC mines is the U.S. Agency for International Development and the Organization for Economic Co-operation and Development (OECD). Under the guidance of Congolese authorities, and with assistance from the foreign NGOs, artisanal miners “bag and tag” their minerals in a large clear plastic bag with a tag that bears the name of the certified mine and a bar code that’s electronically logged by DRC authorities and NGOs.
According to one transparency effort, the Tin Supply Chain Initiative, the bar code allows them to track the bagged minerals' weight and price, the date of extraction, initial and subsequent buyers, transportation method and routes, and finally, where the minerals were processed.
Another program, called Solutions for Hope Project, involves the AVX Corporation, a manufacturer of electronic capacitors based in Greenville, S.C. Following OECD guidelines for a “closed-pipe” supply model, AVX is purchasing and delivering conflict-free tantalum from a single certified site in the eastern DRC that is owned by the DRC government, and transporting the ore to a certified conflict-free smelter, with the final product shipped to an AVX plant.
Other manufacturers and retailers, such as Apple, are utilizing third-party auditors to conduct due diligence in the upstream supply chain as the minerals are shipped from certified mines, sold to metals brokers in nearby eastern DRC cities, and exported and sometimes exported again to another country to smelters. Once the certified bagged and tagged minerals arrive at a smelter, in China, for example, they are considered downstream on the mineral supply chain. Here, personal consumer electronics companies like Apple and Intel have established a last wall of traceability at the smelters themselves. This program is run by the Electronic Industry Citizenship Coalition, or EICC, a nonprofit with more than 100 corporate members, including Apple, Intel, Microsoft, IBM, Sony and Motorola.
According to a 2015 report from Responsible Sourcing Network — a project of the nonprofit As You Sow, which works to end the human rights abuses and forced labor associated with raw materials — Intel, Qualcomm and Apple are leading the global industries in sourcing their minerals and reducing their use of conflict minerals. “Intel started our work to achieve a conflict-free supply chain in 2009, and it was a proud moment when we reached that goal for our microprocessors in 2014,” said Jackie Sturm, vice president for global supply management for Intel, in a statement released with the report. “Now we are on track to make all of our products conflict-free starting in 2016.”
“Qualcomm is proud to be recognized as a leader in the effort to ensure industry supply chains aren’t supporting groups that commit human rights violations in the Democratic Republic of the Congo or adjoining countries,” said Roawen Chen, senior vice president of operations at Qualcomm, in the same statement. “But this is not a single company or industry effort – cross-industry collaboration, engagement with nonindustry stakeholders and support for projects on the ground are critical to our effort to promote the responsible sourcing of raw materials.”
Protocols are in place to prevent fraudulent tags from reaching certified smelters, says Michael Rohwer, program director for EICC. “If tags are used with numbers that have not been issued [by traceability programs], or if people create their own tags with the same numbers, they are highlighted as invalid or as duplicates at the point they entered the supply chain and investigated,” he says.
“We have seen a growth in compliant smelters that is tremendous,” Rohwer says. “The number of compliant smelters has doubled from the end of 2013 to the end of 2014. It’s been an exciting experience.” In addition, he adds, “we have roughly 80 to 85 percent of the total [world] tantalum supply chain validated as conflict-free.”
But Fahey says his team of U.N. investigators suspects some militias may be circumventing the bag and tag program. The U.N. investigators discovered copycat or fake duplicates of the tags circulating through the eastern DRC and Rwanda.
One way to avoid any such problems is for mineral purchasers to avoid using Congolese minerals at all, something some companies have done. However, avoiding all material from the DRC has unintentionally undermined the livelihoods of artisanal miners as well, adding to the plight of the Congolese people, according to the Washington, D.C.-based NGO, Friends of the Congo.
“Even if there have been unintended consequences, that is part-and-parcel to dismantling the illicit way these minerals are being mined and traded,” says Alan Martin, spokesperson for Partnership Africa Canada (PAC), an NGO that investigates conflict and natural resources in Africa. “This process takes time, but there is movement. You are seeing significant actors in the supply chain, whether you’re talking about … Apple and Intel, or whether you’re talking about Motorola and Boeing, doing their due diligence.”
Martin says PAC — which has representatives on the ground monitoring mines in the eastern DRC as Canada considers a law similar to the Dodd-Frank Act — is fully aware of the limitations Westerners have in such chaotic and unsafe places. Thus, he says, certifying mines in rugged and remote areas of the eastern DRC at the moment is “very fluid,” adding, “there are mines where the militias are not in place one month, and then they reappear” the next.
Although the jury may still be out on how much Dodd-Frank has helped in the DRC, Martin says that there’s not much disagreement that the law’s fundamental job — forcing multinationals to demand transparency from their mineral suppliers — is beneficial.
“The war in the DRC is not about minerals in the first place; it is about politics and power,” says Christoph Vogel, a researcher at the University of Zurich’s Political Geography Unit. “As much as any war in history, it must be funded, either by minerals or something else,” he says. In addition, there is instability within the DRC federal government, and instability being initiated by the DRC’s neighbors, Rwanda and Uganda, as both strive for regional influence and protection of their own interests. Both nations have also been accused by the U.N. of backing an unknown number of militias entrenched in the DRC. And, according to the U.N., the Rwandan army in 1999 made $250 million selling tantalum to metals brokers even though Rwanda did not have a single source for tantalum within its borders that year — suggesting most or all of the tantalum came from Congolese mines.
Rwandan support for militias in the DRC continues to be a source of instability, says Maurice Carney, executive director of Friends of the Congo. Following a 2011 investigation, in 2012 the U.N. Security Council issued a report stating it found substantial evidence attesting to support from Rwandan officials to armed groups operating in the DRC. Rwandan President Paul Kagame has repeatedly denied any involvement, but when President Obama in 2012 personally warned Kagame that supporting eastern DRC militias would strain relations, Carney says the effects were tangible, with at least one militia handing over guns soon thereafter (although there may have been other factors that prompted the group’s surrender as well).
“These proxy militias within the country are a major barrier to peace,” Carney says. “When pressure is applied [from outside sources], we see an appreciable and noticeable difference on the ground.”
So what else can be done? Both Fahey and Carney call for implementing Dodd-Frank in phases with benchmark goals, such as providing assistance to affected mining communities — especially to those miners who can prove they lost reliable sources of income to any de facto ban on Congolese minerals — and turning traceability programs into job programs.
“Why not build manufacturing and smelter plants within the [DRC] where everything is right there?” Carney asks. “Then you don’t have to worry about tracing minerals across the world.” Smelters, he says, would bring needed investment and jobs.
Still, lasting impacts of Dodd-Frank on the violence in the eastern DRC could take years to decades to materialize, if they come at all, given that the law is still under litigation in the U.S.
For now, however, U.S. companies will continue complying with the transparency laws, and experts will continue documenting conditions and working for change in one of the poorest nations on Earth.
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