How Foreign Trade Plays a Role in Illegal Mineral Extraction in the DRC
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
How Foreign Trade Plays a Role in Illegal Mineral Extraction in the DRC The Uplifting Africa Program 2/24/2021 Illegal Mineral Extraction – Democratic Republic of the Congo Mason Escamilla The Uplifting Africa Program https://www.upliftingafrica.org The Eurasia Center
How Foreign Trade Plays a Role in the Illegal Extraction of Minerals in the Democratic Republic of the Congo Illegal Mineral Extraction – Democratic Republic of the Congo Introduction As the African economy and its share of global trade continues to grow, its issues with illegal mining and resource extraction have also increased. The continent has faced severe conflicts over resources such as columbite-tantalite(coltan) and cobalt, both of which are key components of rechargeable lithium-ion batteries used in many devices. Devices such as laptops, cellphones and electric cars almost exclusively consumed and produced by American, European and a growing number of Chinese consumers have increased illegal mining in the continent, especially in zones of African nations rich in these resources. While foreign demand has increased, the development of nations with these resources especially in Africa, has not improved. This especially true for the case of the Democratic Republic of the Congo, a nation that for decades has been a place of conflict over its material wealth. The Democratic Republic of the Congo (DRC) has as much as 80% of the world’s coltan, with a projected total of mineral resources worth $24 trillion USD3, and even with this immense number of resources is one of the poorest and most unstable countries in the world1. The mining
industries of the DRC have been characterized by a mixture of both formal and informal activities, involving both international and government entities abusing this reality for their gain. Corruption, human rights abuses and warfare are issues surrounding the mining process which threatens the lives of thousands of Congolese. And while these atrocities are well documented the growth of the industry regardless of its practices has shown the lack of accountability when holding firms and individuals accountable for the profiteering of these resources. Because of this transient nature of the supply chain for these resources large corporations have been able to partner with smaller traders to avoid both paying fair prices and facing the reality of the abuses they encourage. Along with western tech brands, Chinese independent traders contribute to negligence by buying coltan and cobalt directly from minors without inspecting its extraction conditions and then sell it to larger smelters in the DRC to be exported. Coltan mining has been linked to Human Rights violations, environmental destruction and child labor, and initiatives to thwart these abuses have had mixed results. While previous attempts to prevent illegal mining in the region has been focused on supervising artisanal mining locations and domestic intervention, corruption and instability due to conflict make this difficult to enforce. Newer protocols have also been used that target foreign companies who play a role in the coltan supply chain and those not practicing due diligence to encourage supply chain transparency. Illegal Mining in the Democratic Republic of the Congo The aspects of mining have changed over time in the DRC, allowing the spread of illegal and inhumane mining practices to be pervasive and difficult to track. The mining industry has been a cornerstone of the Congolese economy since the colonial times with the Belgian UMHK being the first company to exploit Congolese mineral resources and develop the economy to facilitate resource export for Belgium’s empire. Historically, the mining industry accounted for 25% of Congo’s GDP ($47 billion USD) and about three-quarters of total export revenue5. Mining Cobalt and Coltan has occurred since its discovery in the Congo in the early 20th century, initial mining practices were large scale and industrial even after Congolese independence, with processing and mining facilities up until the 1990’s being controlled by nationalized companies.
Companies like the Zaire-Eitan and publicly maintained Gecamines2 existed as the main facilities for coltan and cobalt to be prepared for export3, these government run and large-scale mines employed 20% of the labor force during the 70’s and 80’s1. Initially these worked to fulfill foreign demand, domestic problems with corruption and government negligence led to increasing problems which peaked a decade later. The collapse of President Mobutu’s government and the transition of power to President Kabila in 1997 left many government mining employees unpaid, and government incompetence led to destabilizing Congolese owned mining operations7. This was paired with the first Congo War (1996-1998) where political instability and rising prices in Cobalt and Coltan encouraged local and foreign militant groups to invade and loot Congolese resources; smuggling them out of the country for export4. President Laurent Kabila’s reign was mired with violence as well, as multiple nations and militant groups returned to warfare in the second congo war lasting until 2003. The Kabila regime, anticipating military defeat given the poor state of the Forces Armées Congolaises (FAC), mobilized support among other African nations. Angola was the first to intervene militarily on behalf of Kabila in August 1998, fighting the Rwandese-Ugandan forces in western Congo. Subsequently, troops from Chad, Sudan, Namibia and Zimbabwe intervened to support Kabila6. Violence surrounding the industries led to devolving conditions and tech development in America and Europe caused rising prices of Coltan to its highest peak for $600 per kilogram, increasing artisanal mining practices. Today 1 kilogram of coltan sells for $100 while artisanal miners are paid around $1 a day to retrieve it8. As the Congolese government could not maintain industrial facilities; makeshift artisanal mines started to appear and processing plants in the DRC became mostly
foreign owned enterprises, principally by Chinese mineral processing companies. This brings us to the current state of affairs where small scale artisanal mines produce raw minerals to be exported by international producers. ASM (Artisanal and Small-Scale Mining) operations began to appear to meet the demand for Cobalt and Coltan, they are characterized by miners’ usage of primitive hand tools and water panning, independently selling their finds to industrial processors who export refined materials. As demand grew due to an increase in demand for computers and smartphones in the early 2000’s ASM’s became the backbone of the industry during the late, and even with the poor conditions, the so-called ‘coltan fever’4 made being a miner even more lucrative. Since ASM is based on extensive use of labor, low wages are also essential for its economic competitiveness, factors that make large mining investment more expensive or risky also make ASM comparatively more attractive5. Since the booms large portions of the population have left other fields such as agriculture and education to pursue higher paying yet dangerous mining positions. These issues have changed over time with the current methods of dealing with illegal mining somewhat lacking. While today some of these Artisanal mines are government regulated in Areas for Artisanal Exploitation (ZEA’s) since 2002, ensuring relatively safe work environments, these zones do not encompass large enough areas and many mines and miners operate outside of government regulations. Currently it is estimated that 300,000 individuals work in the coltan mining trade, and this industry alone employs approximately 19% of the total population5. With cobalt there is similar scale; 110,000-150,000 recorded workers making up the industry and a large proportion in illegal mining practices7. ASM operations are also characterized for causing both environmental and social problems in the areas they exist in including child labor, water contamination and severe health hazards. UNICEF estimated in 2014 that approximately 40,000 boys and girls work in all the artisanal mines across the whole of the province, many of them involved in cobalt mining1. One of the main issues of illegal mining and how to prevent it is the transient supply chain that exists. From artisanal mining, ores are then sold to traders or buying houses who then sell the bulk amounts of ore to smelters and refineries. Most of these refineries are foreign owned business such as the Congo Dongfang mining international (CDM)7 is one of the largest buyers of artisanal cobalt ore. Refiners then export these illegally produced resources to be turned into manufacture products such as smartphones, laptops and other products that use rechargeable lithium-ion batteries. Coltan has a similar issue with its’ supply chain, unregistered
materials make their way into factories in China, Europe, Japan and the United States where they are used to produce alloys and computer parts5. Overall, the DRC has approximately 60% of the worlds Cobalt and a projected 80% of the worlds Coltan making it one of the most mineral rich countries in the world, with this in mind we can assume the industries of mineral extraction are most likely here to stay. Effects of Illegal Mining As said before mining of minerals like cobalt and coltan in underdeveloped and unstable nations such as the DRC can cause serious problems, and these issues become even larger when mining activities are illegal and unsupervised. Because of the lack of development miners in the DRC typically use hand tools such as mallets and chisels to retrieve minerals, with no boots, gloves or face masks to prevent breathing in toxic cobalt dust2. The mining sites are also just as underdeveloped; shafts that are dangerous and prone to collapse are prevalent in unauthorized areas, some that go deep enough require oxygen be pumped down with high risk that machinery can fail leaving miners trapped and suffocated7. Along with the lack of health and safety, many working in unauthorized artisanal mines face strenuous 12-hour workdays giving their higher chances of injury and exposure to harmful chemicals. Those involved in the mining face serious chronic health issues such as respiratory issues, broken limbs and stressed muscles along with the possibility of death. In multiple mines annually mineshaft collapses or accidents account for multiple deaths consistently7, almost all illegal mines have had worker deaths related to collapses. Even with these problems becoming a miner can be in the short run very lucrative especially for younger and poorer Congolese workers. Since over three quarters of the population live on less than $1.90 a day6 and a vast majority of workers suffer from underemployment, coltan and cobalt
mining have become major industries for sustenance. This dependence on illegal mining for many Congolese has also encouraged children to join the mining workforce. In 2000, the ILO estimated that nearly 2 million children aged between 10 and 14 were economically active in the DRC, with an almost equal number of girls and boys8. Children working in mining camps and quarries comprise on average of about one third of the workforce, most of which involves carrying over 20-40kg bags of mining refuse and panning for ore. The mining environment also puts children at even more risk for sexual, physical and psychological abuse perpetrated by mining managers and armed militants who own the mines2. Along with being part of the mining process; some children are coerced into military service by armed groups8, resulting in thousands of child soldiers fighting in local conflicts. The pervasiveness of mining as a main source of Income for the Congolese economy has hampered attempts at development and shown that DRC economic viability is heavily tied to different mining industries, inflaming the main problem of lack of economic diversity and underemployment6. The profiteering of unregulated artisanal mines has also enticed militant groups and corruption to leak into resource rich regions such as eastern Katanga, North and South Kivu, and Masisi. Recent investigations say 110,000 artisanal miners work in regions rich in Cobalt and Coltan like Katanga Province, 20% of the DRC’s total exports of these minerals comes from this region alone, Katanga at the same time hosts multiple armed insurgent groups most of which involved in illegal mining4. Armed Rebel groups such as the FDLR from Rwanda who have consistently taken up residence in the Kivu provinces make millions off the artisanal mines through extracting taxes from miners and coercive illegitimate governance in the area4. This includes setting up road blockades to demand tolls and forcing whole villages to take part in nearby mining operations, usually with the threat of violence. Illegal mining operations are susceptible to being controlled by unauthorized militant and governmental groups and these
mining sites are major spots where groups can gain funding and forced conscripts to maintain their operations. This needs to conquer and control mining locations has led to outright pillaging and warfare between the Congolese government and other entities, fighting for control of mining sites has led to deaths and serious instability. The social and economic problems brought about by illegal coltan and cobalt mining is also paired with its large environmental impact. Since both these resources are highly valued, wherever ore is found is turned into a mining site as quickly as possible. This action has resulted in steady deforestation, trees are cut down to make room for mining facilities including places for miner to live5, along with timber for firewood. This deforestation has caused several issues with endangered species, as miners hunting for sustenance has had a massive impact on Ape populations including gorillas, chimpanzees and bonobos, causing prediction of extinction in the region to occur within 10 to 20 years10. Other species effected include water buffalos and elephants, with some sources saying areas close to mining sites have already brought local elephant populations to extinction. The washing and sorting of ores are another part of the industry that impacts the environment specifically water ways. Because washing and panning is used, mining sites typically occur close to bodies of water like streams or streams10, and the usage of water to clean and sift ores leads to large deposits of silt into rivers and streams. This can lead to water contamination as coltan is mildly radioactive11, at the same time the silt deposits can lead to erosion and landslides, deteriorating the soil quality and lowering fish harvest to those nearby. Cobalt has similar effects, with copper and cobalt leeching into groundwater and disrupting wildlife. Foreign Demand and the Supply Chain The effects of illegal mining on the DRC are staggering, and foreign increase in demand for these minerals has exacerbated the effects. It is estimated that the illegal trade of coltan in the DRC is worth $203 million USD annually, one fifth of the entire world market volume. With the
expected current rate of 5% increase in demand for cobalt7 foreign demanders have continued to demand cobalt regardless of human rights abuses, as significant decreases in the problem have not occurred. In a recent groundbreaking case12, it has more recently been brought to the attention of NGO group ‘International Rights Advocates’ that corporations such as Tesla, Microsoft and Apple that inhumane practices have been acknowledged and allowed at illegal sites where these firms receive coltan. Multiple child workers12 came forward to demand restitutions for injuries, while others demanded reparations for deaths related to mining collapses and health issues resulting in mining where these companies were known patrons. This is an important step as this is the first US case filed against large tech companies related to their usage of conflict minerals. Although all three of these companies have established policies about conflict minerals, especially coltan, there is still considerable evidence suggesting their usage of problematic extraction methods. Foreign demand by Chinese manufacturers has also been a pressing part of coltan and cobalt productions. The ability for many tech producers and manufacturers around the world to exploit these resources is mostly because of the organization of the supply chain and its lack of transparency due to instability and conflict. The main issues of lack of traceability of coltan and Cobalt are mainly in the ‘upstream’ aspects of the extraction, this includes the artisanal miners, the independent traders who directly buy from them, and the smelting houses that export refined materials to component producers abroad. Most artisanal miners in mineral rich regions such as Katanga and Kivu sell their finds to Chinese owned buying houses and traders, major contributors have been Congo Dongfang Mining international (CDM) and its parent company Huayou Cobalt. It has been reported that through CDM Huayou cobalt receives 40% of its total supply of cobalt7, selling a total of $235 million USD worth of cobalt alone in 2013 to Chinese, American, Korean and European manufacturers. Manufacturers on this list include Apple, Microsoft, Samsung, Huawei, and Sony. Chinese buying houses and refineries of Cobalt and Coltan make up the backbone of this part of the process and continue to buy these resources as low-price margins to be sold for immense profits14. Along with both manufacturers buying illegal and inhumane resources in the DRC, some have even tried to find safety from scrutiny through buying from nearby regions and nations who contribute to instability in the DRC. Such is the case for Uganda and Rwanda, both of which have since the Congo Wars sold more resourced
than they had reported on hand4. Even though Rwanda possesses small reserves of Coltan within its own boundaries, in 2008 it earned US$19.2 million from Coltan sales, with an increase of profits of 72.1 percent compared to the previous year3. The ability for traders to retrieve foreign documents through the black markets has also allowed illegally produced minerals such as cobalt and coltan to travel to Rwanda where it is sold to foreign manufacturers12. Because the exploitation of cobalt and coltan mining shuffles into so many hands from individual miners to traders to smelters then to manufacturers and finally to tech producers, it is important that each step is met with due diligence and ensuring all policies outlined under OECD Guidance7. On the one hand, public statistics indicate that most cobalt used in the world comes from the DRC. Yet, on the other hand, most of the companies contacted by Amnesty International as identified in this report, deny sourcing cobalt from the DRC and/ or from Huayou Cobalt, a company which has a considerable presence in the industry as well as in that country. The companies have made these denials despite publicly available information identifying them as part of the supply chain. However, without any legal requirement for these companies to disclose the basis on which they are coming to these conclusions (i.e., no links to child labor, DRC cobalt or Huayou Cobalt), Amnesty International cannot independently evaluate or challenge their assertions8. As a result of this lack of transparency, the people at the beginning of the supply chain, who suffer human rights abuses, are no better off in terms of having their situation improved and right to remedy realized. Yet, companies are still able to profit.
Citations 1. https://www.theguardian.com/global-development/2019/dec/16/apple-and-google-named-in- us-lawsuit-over-congolese-child-cobalt-mining-deaths 2. http://afrewatch.org/sites/default/files/amnesty_afrewatch_2016.pdf 3. https://globaledge.msu.edu/countries/democratic-republic-of-the-congo/economy 4. https://www.files.ethz.ch/isn/112272/SIPRIInsight1001.pdf 5. https://css.ethz.ch/content/specialinterest/gess/cis/center-for-securities- studies/en/services/digital-library/articles/article.html/96390 6. https://hcss.nl/sites/default/files/files/reports/HCSS_21_05_13_Coltan_Congo_Conflict_web.pd f 7. https://www.afdb.org/en/countries-central-africa-democratic-republic-congo/democratic- republic-congo-economic-outlook 8. https://www.amnesty.org/download/Documents/AFR6231832016ENGLISH.PDF 9. https://globalmarch.org/child-labour-in-the-democratic-republic-of-congo/ 10. https://reliefweb.int/sites/reliefweb.int/files/resources/67F4422FF32419124925751E001D2482 -Full_Report.pdf 11. http://bornfree.codeomega.co.uk/wp-content/uploads/2016/12/coltan.pdf 12. https://www.researchgate.net/profile/Eduardo_Salcedo- Albaran/publication/322338059_Trafficking_of_Coltan_in_the_Democratic_Republic_of_the_C ongo/links/5a54d510aca2726c0ff1fd87/Trafficking-of-Coltan-in-the-Democratic-Republic-of- the-Congo.pdf 13. http://iradvocates.org/sites/iradvocates.org/files/stamped%20-Complaint.pdf 14. https://www.aljazeera.com/features/2016/1/19/blood-and-minerals-who-profits-from-conflict- in-drc 15. Bleischwitz, Raimund & Dittrich, Monika & Pierdicca, Chiara, 2012. "Coltan from Central Africa, international trade and implications for any certification," Resources Policy, Elsevier, vol. 37(1), pages 19-29.
You can also read