Global Policy Forum

Picture Credit: Fastcoexist

These articles comprise 2 sides of the debate on the provisions of the Dodd-Frank Act which attempt to address the conflict minerals trade out of the Democratic Republic of Congo. The legislation, enacted in July 2010, aims to curtail the profitability of the trade in conflict minerals such as coltan, gold and tantalum by placing more prominence on due diligence procedures further down the supply chain. Critics argue that the legislation is throttling potential areas of economic growth for artisanal mining communities in the conflict ridden region, while supporters argue that the stricter compliances cut off a key form of funding for violent non-state actors. 

By Chuck Blakeman 

Stephen Groff’s article Conflict Minerals: Hands-Off is Not a Solution is remarkably naive and removed from the actual problem, and represents a pervasively uninformed and simplistic view of what is going on in the DR Congo. As a result of the Dodd-Frank Act’s demonization of minerals instead of criminals, exportation of the four minerals covered by the Act has nearly evaporated from the Congo.

A recent article in The Economist says that 95% of mineral exports have evaporated, while Motorola’s Solution for Hope Project argues that “Tens of thousands of people in the DRC depend on artisanal mining, many operating in regions where conflict is not present. Their livelihoods and the economic stability of the region have been threatened by the de facto ban.”

Personal experience backs this up. Our company, Groupe Weyi, has 50 tons of coltan from a local tribe sitting in a warehouse. Six weeks ago we had a buyer. Today we can’t find anyone buying coltan from DR Congo, anywhere in the world.

Our export process is well documented, government approved and done through a highly visible process that tracks it from the mine to the ship – but no one is buying. The smelters all say that minerals coming out of the Congo are “radioactive” now. Why buy from there when they can buy from a dozen other places on the globe without risking misperception? They have simply left the area.

So while all of those who are thousands of miles away pontificate about how great this solution is, honest miners all across the Congo are now starving because they can’t find a buyer.

Everyone likes to say this isn’t impacting people on the ground. But please note who everyone is quoting – giant NGOs, giant organizations, giant corporations and giant governments. Nobody seems to have spoken to anyone on the ground. That should say something very powerful to us. Why don’t the supporters of Dodd-Frank produce a poll of people in the Congo to tell us how much they love this law? Because the only support they can find is people who don’t live there.

I can produce chiefs and whole tribes who have been devastated by this demonization of minerals instead of criminals. Dodd-Frank is like blaming houses for the presence of a burglar. It burns down every house in the town so the burglar has nothing to steal. The burglar will simply move on to steal from stores instead of houses. Meanwhile 1 million people in the Congo who depend on mining for a living are being devastated by the universal collateral damage of this “nuclear” option.

The militias existed long before they found minerals as a source of revenue. What in the world makes anyone think that burning down the entire mining industry in the Congo will put the criminals out of business? What an incredibly naive and simplistic solution. The criminals will simply find something else to steal.

These minerals are mined in six regions – five of which are hundreds to a thousand miles from the conflict zone and aren’t even connected by a road. Dodd-Frank burns all of them down, too. The very people you think this is supposed to protect are being destroyed.

Get the United Nations to grow a backbone and go in and root out the militia. Or require Kinshasa to grow a backbone. Do anything we can to rid the world of those militias, but don’t do it at the expense of every man, woman and child throughout the Congo related to mining. A nuclear option that demonizes minerals instead of criminals is not acceptable.

Groups like ours are the solution, not another bureaucratic process that will only make it difficult for honest people to export while the criminals scoff and pay a bribe to make it all go away.

Groupe Weyi is not a mining company, not a multinational, but a company incorporated in the DRC, majority owned by a Congolese, that works with local tribes to build a local, sustainable economy and solve poverty within 5-10 years in the Congo and 10-20 years in Africa. Exporting minerals is what the tribes feel right now is their best, most stable and sustainable source of income, and one that can create higher wages almost immediately.

Mining will also generate revenues for creating other longer-term, much better local economic options at a much higher level than micro-financing could achieve, including agriculture, herding and husbandry, aviation and water transportation. We are already building our first commercial river barge. We will also use profits to rebuild infrastructure, water, schools, clinics and other necessary services.

A local economy will never be built on the backs of large corporations or multi-national entities, but by the emergence local businesses throughout the Congo creating a sustainable local economy that is not dependent on large corporations or mining for their existence.

Everybody seems to think (mistakenly) that they can say: “I’ve been to the Congo and met the local communities. These communities live mainly by exploiting minerals. Section 1502 of the Dodd-Frank Act affects their means of living, and the economic stability of the region is threatened by a de facto ban. This law deprives thousands of people of their livelihood, etc.”

To be frank, this simplistic view is irritating. People who share it shouldn’t believe they’re helping us. On the contrary, they’re destroying us and working against the interests of Walikale. Have they really met local communities, or are they just interested in the minerals and, given the difficulty in getting to the communities, limited themselves to talking to city-based mining interests? Interests that will exploit such talk in their own interests to make official declarations that engage local communities for no reason at all.

Anybody claiming to defend a people should first get to know that people – its history, culture, way of life – and know where to find it. Otherwise, you’re only mocking this people. Experience has shown how tricksters pass themselves off as the people’s champion. They show the world the people’s misery and highlight the need to improve its well-being. But at the end of the day, you realise they’re looking after their own interests.

Who can seriously claim that before the mining sector was liberalised, Walikale’s population went hungry? Mineral resources aren’t Walikale’s only source of wealth: it also has vast tracts of very rich farmland. It’s a territory made for agriculture .

Before 1985, Walikale had numerous pasturelands. Apart from abundant rice crops, there were also many plantations producing high quality coffee, cocoa, plantains and maize, to name only the main cash crops, as well as market gardening, vegetables and palm oil.

These haven’t all disappeared, and the population won’t starve just because mining has been suspended. Artisanal miners with no plots of land complain about mining being stopped, not the local communities.

As everyone knows, over the past decade, the great powers, dictators, private firms, criminal networks and rebel forces have ruthlessly exploited our wealth, plunging most of the population into extreme poverty. The profits from mining haven’t helped local development or local communities. These minerals were exploited with nothing given back in return. Taxes and state levies rarely if ever reach the local community. This windfall didn’t go unnoticed by the DRC’s neighbours, who helped themselves.

These minerals don’t just create conflicts and wars, they help to sustain them, with armed groups fighting for control of mining areas, as happened in Kaseke in July 2011, when a large share of the population had to flee fighting between two groups. We suffer more from having to watch passively how our minerals are exploited than from leaving them buried for the good of future generations.

Mineral resources are by definition non-renewable, making it urgent to find solutions for the harmonious, viable and sustainable development of the mining sector. And Walikale is ready to support the suspension of mining activities for another five years to help reform the sector.

To this end, Walikale’s local communities renew their support to national indicatives (ITIE/RDC, Revision of the Congo Mining Law) sub-regional ones (CIRGL) and those at international level (ITRI/OECD). And in particular, we reaffirm our support for Section 1502 of the July 2010 Dodd-Frank Act, because it marks a break. It contributed to implementing solutions allowing for the traceability of resources from the mine to the point of export in view of local development.

The communities are therefore placing all their hopes in this law. Thanks to this law, they stand to benefit from their natural resources one day. As well as that, this law intends to cut the link between trade in these minerals and the conflicts that bring grief to the people of the Congo daily. Walikale’s local communities there call for the application without further delay of the regulations based on the Dodd-frank Act concerning conflict minerals. This is what we need now.

Desirable economic transformation of this wealth requires good governance, transparency and a stable socio-political climate. It is the state’s responsibility to ensure that this natural mineral wealth is exploited in the most beneficial, efficient and best way. The state must ensure that due diligence in minerals supply is observed and discourage campaigns against the citizens’ interests.

A well-regulated mining sector governed with transparency, and well organised and supported  can help lift the Congo’s people out of extreme poverty, restore public finances to help the state function properly, and contribute to regional and international development, as is the case for many other countries in the world.