Tuesday, January 1, 2013

Press Round Up on Conflict Minerals

This post will be updated as new articles appear.

[A few recent articles pinned, then in chronological order]
Photo essay by Robert Carrubba

For the people in the eastern DRC, small-scale gold mining is a key source of income. The workers risk their lives digging for the ore, which passes through many hands before it becomes a gleaming bar of pure gold.

Sara Geenen
Lecturer in Globalisation, International Development and Poverty, University of Antwerp
Second, an indirect effect on health care and child mortality has been documented. Researchers from the United Nations University conclude that the probability of infant deaths near the policy-targeted mines increased by at least 143%. This they attributed to mothers’ reduced access to infant health care.
IRIN: The Inside Story on Emergencies
How advocacy gave Trump ammunition on conflict-free minerals
The law’s impact on reducing conflict, however, is harder to ascertain and dismissed by some as non-existent.
In one article, Gregory Salter, a former member of the UN group of experts and now a consultant, wrote that the “premise that the mineral trade is the root cause of conflict in the DRC, and that stopping this source of funding to militia or [the Congolese armed forces] will ‘end the conflict’… is rarely (outside the loopier side of NGOdom), if ever, claimed.”
Autesserre wrote that an over-emphasis on “conflict minerals” had come at the cost of neglecting other crucial factors.
“Focusing exclusively on [this] cause of violence… diverted attention from other much-needed policy actions in the field, such as resolving land conflict, promoting intercommunity reconciliation, jump-starting economic development, and fighting corruption.”
However, advocacy groups like the Enough Project, Amnesty International, and Global Witness constantly push the link between minerals and conflict and appear reluctant to genuinely accept and address the law’s shortcomings.
“It seems to me that the preponderance of evidence suggests that people’s livelihoods have been affected: a lot of people have become poorer,” an employee of one advocacy group told IRIN. “And yet, I think a lot of campaigners have difficulty accepting that was the case… there’s been a lack of willingness to look the facts in the face.”
This view was echoed by several employees from other advocacy organisations – all of whom preferred to remain anonymous. Some declined on-the-record interviews out of concern for their job prospects.
IRIN: The Inside Story on Emergencies
Who pays the hidden price for Congo’s conflict-free minerals?
An IRIN investigation finds merit in President Trump’s claims that a US law banning conflict minerals is leading to lost livelihoods
Valentin was in trouble. His arms were tied behind his back and he couldn’t move. The sun was beating down in the courtyard of the mining company where he and his friends were being held.
The men had been arrested by mining police for peacefully protesting the low price of the coltan ore they had dug out by hand from deep narrow shafts in the Democratic Republic of Congo.
Western activists have sought to help end violence in Congo by championing conflict-free mineral policies that aim to stop armed groups profiting from the trade. But thousands of miners like Valentin are paying a heavy price. At his mine, Kisengo, a monopoly on clean coltan has kept prices low, reduced revenues, and driven some miners to trade their wares illegally or move into the illicit artisanal gold sector.
Wall Street Journal
How Dodd-Frank Led to More Mayhem in Africa
A measure to curb violence from conflict minerals has caused militias to simply expand their looting.
Rep. Barney Frank (D., Mass.) famously said at the time that the bill was supposed to “cut off funding to people who kill people.” But new research shows the regulation has had the opposite effect and escalated violence in the eastern Congo.
The Conversation: Wall Street watchdog SEC can’t end violence in Congo
Karen E Woody
Assistant Professor of Business Law and Ethics in the Kelley School of Business, Indiana University
The SEC was created to help assure investors that their investments are safe.
Markedly absent from this congressional mandate is any administrative authority or charge to effect international, diplomatic or human rights-oriented goals. By charging the SEC with achieving goals of foreign affairs, as it has with the conflict minerals provision, Congress has doomed the SEC to fail at accomplishing the provision’s stated goals.

[now in chronological order]
Businessweek: A rule aimed at warlords upends African miners.

New York Times: How Congress Devastated the Congo
(The op-ed by yours truly)

The Economist: The conflict mineral campaign has been a disaster for Congolese.

Reuters: US Buyers Shun "Conflict minerals" in Congo's east

The World: Why Chinese Mineral Buyers are Eyeing Congo

Reuters: Conflict Minerals Crackdown Backfiring in Congo--UN
n.b., for a discussion of whether the UN report really said this, see Stearns.

May 02, 2012
Bloomberg News: Congo Clashes Thwart Plans to Export Conflict-Free Minerals

BBC: Rebels make their money from many sources, not just conflict minerals

Reuters: 'Conflict gold' trade continues in face of U.S. law

Reuters: Exclusive: Mineral traders in Rwanda helping fund Congo rebels

Financial Times: Central Africa: The quest for clean hands
A Dodd-Frank act provision on stemming ‘conflict minerals’ trade has failed to rein in Congo militias

Wall Street Journal: Inside Congo's Link in the Gold Chain
"Opportunities for Illicit Gain Only Increased After Conflict Minerals Law"

Associated Press: Officers in Congo benefitting from mineral trade

Politico, "Dodd Frank's Misadventures in the DRC"
"If there is a lesson of 1502, it may be this. It’s relatively easy to source minerals in a warzone and pour them into an international market that demands ever niftier gadgets. But regulating the supply chains of our global economy—without inflicting harm on whole communities by choking off livelihoods in far off lands—is an altogether harder task."

The Guardian, Obama's Conflict Minerals Law has Destroyed Everything, say Congo Miners
"When his father could no longer make enough money from the tin mine, when he could no longer pay for school, Bienfait Kabesha ran off and joined a militia. It offered the promise of loot and food, and soon he was firing an old rifle on the frontlines of Africa’s deadliest conflict. He was 14.

But what makes Kabesha different from countless other child soldiers is this: his path to war involved not just the wrenchingpoverty and violence of eastern Congo but also an obscure measure passed by US lawmakers. Villagers call it Loi Obama – Obama’s law."

Foreign Policy, How Dodd Frank is Failing Congo
"The campaign to stop conflict minerals is supposed to be protecting people’s lives in one of the most fragile parts of Africa. In fact, it seems to be doing the opposite."

11.11.11, Dans les Mines Du Kivu, Contre Les Minerais du Sang
Pour lutter contre ce trafic, des ONG et des parlementaires souhaitent mettre ces minerais sous embargo afin de couper les vivres aux milices et d’en finir avec la guerre. De leur côté, les États-Unis ont déjà légiféré dans ce sens avec l’adoption par le congrès du Dodd-Frank Act. Ainsi, depuis janvier 2012, tout achat de minerais en provenance de la région par des entreprises américaines doit être certifié « propre » et ne plus alimenter les conflits. Si la législation a atteint son but – bloquer les importations frauduleuses –, elle a néanmoins produit des effets collatéraux désastreux pour les populations locales.« Nous ne pouvons qu’être d’accord avec la volonté d’éradiquer ce marché illégal. Mais cette initiative nous a fait beaucoup de tort » réagit Milabyo Basila, de la Fédération des entreprises du Congo. « Faute de certification, le Dodd-Frank Act a créé un embargo de fait sur tous les minerais provenant du Kivu, y compris ceux qui sont exploités légalement, confirme Aimable Muneza, président d’une coopérative de creuseurs artisanaux de la mine de Rubaya, dans la zone du Masisi, au nord-est de Goma. Des milliers de creuseurs artisanaux et toute la filière d’exportation des minerais qui travaillent en toute légalité se retrouvent maintenant sans travail faute de clients. » « Une telle mesure a contribué à rendre la situation intenable pour beaucoup de familles, ajoute Laurent Mikalano, coordinateur de l’ONG Copare. Certaines n’ont plus de revenus fixes depuis des mois. »

Round Up of My Writings about the Conflict Minerals Campaign

Round Up of My Writings about the Conflict Minerals Campaign

The New York Times oped:
How Congress Devastated Congo
IT’S a long way from the marble halls of Congress to the ailing mining towns of eastern Congo, but the residents of Nyabibwe and Nzibira know exactly what’s to blame for their economic woes.

A Response to Enough
The Huffington Post has published Enough's response to my New York Times op-ed. I think it's unconvincing, for several reasons

What Should We Have Known? (First of several)
None of the people responding critically to my op-ed in the NYT letters section or the blogosphere denies its principal claim: that the law has immiserated a million or so highly vulnerable people. None of them, however, suggests this information has spurred them to reconsider their support for the law, slow their efforts to see it implemented, or make any effort to help the miners whose livelihood the law has all but eliminated. In fact, with one exception, none of them discuss the plight of the miners and their families at all: it's as if they don't exist

The Spurious Claims (Second of several)
Defenders of Dodd-Frank make several arguments on its behalf: that it has done a great deal of good and has the potential to do much more good; that it cuts the Gordian knot tying mineral profits to conflict (and therefore rape); that, contrary to my assertion, it does in fact enjoy the broad support of local communities and Congolese civil society organizations; and that miners have not been substantively harmed by the virtual elimination of the trade in minerals. I want to consider each of these arguments in turn, but before I do I want to deal with a few of the less serious objections to my op-ed.

27,000 Americans Call on Congolese to Boycott Money
With apologies to The Onion.
A swelling chorus of Americans is calling on Congolese to help bring an end to the painful cognitive dissonance they feel whenever they play Angry Birds on their iPhone. Led by lovable celebra-dog Houser, best known for rescuing refugees in the former Zaire, the Americans are asking Congolese miners to boycott all forms and specie of money until they sort out their feelings.

Were Congolese Excluded? (Third of Several)
In my NYT op-ed I reported that knowledgeable Congolese felt excluded from the conflict minerals debate. It was, they told me, a dialog in which their voices went unheeded, dominated by Western advocacy groups confronting Western electronics companies. As a result, immensely important decisions about the lives of millions of Congolese were made without any input from them.

Eighty-eight Less than Luther
I spoke last month at the New York City Bar Association* on the predictable but unintended consequences of DF 1502 on armed conflict and economic development in eastern DRC.

Are Enough and Global Witness Violating the Very Guidelines They Promote?
A penpal sends me the following observation: Activist groups like Enough appear to be in violation of the OECD Guidelines they promote as part of the solution to the problem of "conflict minerals."

My Comments at the World Bank
I spoke at a World Bank event last week (November 9) on the various initiatives underway to develop conflict-free mineral sourcing from the DRC.

Yay Us! The Private Public Alliance for Conflict Minerals
There's nothing like watching diplomats at work to make me feel like Holden Caulfield. Last week's launch of the Private Public Alliance at the US Institute of Peace is a case in point.

RePublishing: Why We Need a Social Impact Assessment on Conflict Minerals
How many Congolese children are going to bed hungry tonight because of Dodd-Frank 1502?
This is not a rhetorical question. In fact, we have no meaningful data regarding the extent of the harm caused by DF-1502.

Have Global Witness and Enough Brought Kwashiorkor to Central Africa?
Imagine that your stated goal is to advocate for patients suffering from a terrible, debilitating disease, and that a new drug comes along that promises to alleviate many of the worst symptoms of this disease.

Now imagine that reports start filtering in from clinics where patients are being treated experimentally with the drug. The reports, at best, are mixed. At worst, they suggest that the drug may be truly harmful.

What do you do?

Bisie: A Reality Check
One of the most repeated criticisms of my NY Times piece about conflict minerals is that in my zeal to make the case against Dodd Frank I ignored the many positive developments that were happening on the ground as a result of it. Principal among those developments was said to be the de-militarization of Bisie, the largest tin mine in the Kivus

Questions Enough and Global Witness Refuse to Answer
Global Witness and The Enough Project pride themselves on their hard-hitting, pull-no-punches research into malefactors around the world, from African warlords to corrupt Western bankers. Central to their ethos is a belief in openness and transparency--in the idea, as the cliche goes, that sunshine is the best disinfectant.

Where Now with DF-1502 and the Conflict Minerals Campaign?
A conference on conflict minerals at the Center for Global Development last week revealed that the gulf between advocates and critics of DF-1502 remains as wide as ever. The speakers were Corinna Gilfillan of Global Witness, Mvemba Dizolele of Stanford, Laura Seay of Morehouse, and Enough's Sasha Lezhnev. To my mind, the most revealing statement of the day came from Corinna, who at one point plaintively asked the room, "Can anyone honestly say that having people with guns running around in mining communities is a good thing?"

Why Companies Will Avoid DRC
Given just how incredibly complex and ever-shifting supply chains are, at both upstream (from the mine to the smelter) and downstream (from the smelter to the finished product) ends, it is all but impossible to envision companies ever buying minerals from eastern DRC until rigorous, stable, closed loop supply chains are established. And it is hard to imagine how those closed loop chains could ever incorporate more than a handful of mines, given current conditions.

Rosenblum's Cant and Stearns' Guild
A few weeks ago, a friend sent me a link to Peter Rosenblum’s latest broadside, a letter he addressed to the SEC excoriating my New York Times’ op-ed. The note she attached to the link said, “What did you do, run over his dog?!”

My Testimony before the House Monetary and Trade Subcommittee of the Financial Services Committee
Unfortunately, in their quest to fashion a narrative that would resonate with and therefore galvanize their largely Western audience, activists ignored the complexities of the local context and brushed aside Congolese experts who repeatedly warned them of the dangers the conflict minerals campaign posed to their people.In doing so, they developed policy prescriptions that damaged an already tenuous economy, entrenched the position of the warlords, and accomplished little by way of resolving the conflicts.

Round Up of Congolese Voices on Conflict Minerals

Serge Mulumba, president of the mining cooperative CDMC, in a letter to the SEC:
"We can not give you exactly the number of lives that are lost each day following the cessation of artisanal mining in the DRC and yet even if a child died or who is hungry or do not go to school because his father digger lacked money, this is a tragedy, it is a sad news that should challenge our humanity."

Pastor Raymond, in an open letter posted on Fair Jewelry Auction:
"Please listen attentively to our cries of weeping and anguish. Our families and us will be doomed to death if you do not hear these cries of alarm. Do not wait to rescue us when we will be already in the grave. Act in time to avoid the humanitarian catastrophe that would arise from the consequences of your suspension to purchase our minerals."

Heads of three South Kivu mining associations, in a letter to the SEC, begging them to reconsider DF-1502
"What is the refuge of all the Congolese jobless, around 85 % of the population. Is it to make peace or to trouble the peace, when the life is stopped for a population? No job, no life. Please imagine the consequences…"

Pere Didier de Failly s.j., in a letter to the SEC:
"Now if the Dodd-Frank regulations are applied from April this year it will ruin all these efforts and condemn hundreds of thousands of people in Eastern DRC to keep under the terror of these maffiosi barons, instead of improving the whole situation. Even in Rwanda, Uganda and Burundi, thousands of people will be badly affected."

Open letter to President Barack Obama and SEC Chair Mary Schapiro from 50 religious, civil society and business leaders in South Kivu Province, DRC, July 5, 2011:
In this environment, artisanal mining has emerged as one of our only economic lifelines, and has directly and indirectly provided milions of jobs. The abrupt cessation of this trade has had devastating impacts on our people:

1. Millions of our artisanal miners have suddenly h.d their livelihood cut from under them. (Many of them continue to mine, finding small-scale buyers who are either buying on speculation or smuggling abroad, but at less than a half of what they making before.) They find it increasingly difficult to pay school, health, or maternity fees; some even report having diffculty providing food for their families.

2. Mining enclaves have emerged over the past decade in places so remote that only planes can access them. The world's sudden refusal to buy these minerals means the planes no longer service these communities; with nothing to trade, they are unable to provide themselves with such basic necessities as salt, sugar, oil, cloths, soap and so on.
3. Because artisinal mining was one of our only engines of economic growth, secondary econòmic impacts are being felt throughout the province. Even in our large tòwns, economic activity has diminished; construction slowed; trade in everyhing fallen. People with very little to begin with are now doing with less.

Dominic Johnson, Senior Analyst
NO KIVU, NO CONFLICT? The misguided struggle against “conflict minerals” in the DRC 
The Pole Institute, April 2013

Thus, a pattern is emerging in which Kivu's mining sector is being asphyxiated in the name of reform. Before 2010, Kivu's mineral traders had willingly participated in moves to strengthen formal and legal channels and to safeguard Kivu livelihoods by creating “conflict-free” production and trading chains within Eastern Congo. The mining ban killed this off, and today the focus has moved to Katanga and Maniema, increasingly apparently favouring a nexus of mining firms closely linked to the power-holders in Kinshasa. Because they do not finance armed groups, these firms are seen as “conflict‐free,” but no criteria exists to judge the wider political ramifications of their activities, their benefits for local development and the possible exacerbation of local conflict caused by favouring certain firms in collusion with international partners to the detriment of others. 
Kivu Times interview with Soraya Aziz Souleymane, human rights activist, and deputy director of the Carter Center in the DRC:
What do you think that the appearance of theories of ore blood and certification process brought more into local economies in the mining areas? Do you think for example that the Dodd-Frank Act has led to the restoration of the social climate in the mining areas of the DRC?That's a good question since many communities depend on natural resources. Some international initiatives have decried the problem of conflict minerals. This led the US government to adopt the Dodd-Frank Act which requires all US companies trace their minerals. The Congolese Government has also conducted the suspension of mining activities in some squares. However this has had the effect of further impoverish communities that depend mainly from the exploitation of these resources and has resulted in the creation of major clandestine networks that have propelled him to the rank of Rwanda leading producer of Coltan. For me it must apply the solutions I mentioned earlier, namely the creation of alternative economic activities for communities to survive without these mining revenues. Hail why the recent regulation of the European Union that took this aspect of the local economy into consideration.  [Google translated from French] 
Testimony of Evode Imena, Minister of State in charge of Mining, Ministry of Natural Resources, Government of the Republic of Rwanda
Before the U.S. House Financial Services Committee, Monetary Policy and
Trade Subcommittee
“Dodd-Frank Five Years Later: What Have We Learned from Conflict
Minerals Reporting?”
Despite all these efforts and the costly investments in due diligence, we have noted since 2013 a negative international market bias against Rwandan minerals, and in particular against tungsten, as Dodd-Frank has been fully implemented. This situation worsened in 2014, when companies that process tungsten ore stopped buying from all Central African countries – despite the fact that Rwanda was fully implementing both OECD due diligence recommendations related to conflict minerals and the ITRI minerals traceability mechanism.
The region is now suffering from an “Africa-free” and not a “conflict-free” minerals situation. Section 1502 has caused a de-facto boycott by companies in the US and much of Europe on our most valuable resources. The result is a very limited customer base, which further drives down mineral prices because these customers know they have no competition for our resources.
The situation has largely impacted the livelihood of thousands of miners and their families, as the costs for due diligence are passed down from mineral exporters to mining companies, and then on to mine workers. Based on our calculation, the revenues for mining companies and wages for mine workers have decreased by 3 to 6 percent in the last year. Coupled with price fluctuation,
the situation has become very difficult to miners and to an industry with tight profit margins.