Blood & Gold: The High Price of Mining

Written by on December 11, 2013 in Africa, CSR, Green, Measure Impact, Strategy - No comments

1871875063_5e2eff217eExploitation and the trading of conflict minerals originating in the Democratic Republic of the Congo (DRC) is helping to finance conflict characterised by extreme levels of violence in the eastern DRC. This battle has claimed more than 5.4 million lives since it began in the late 1990’s. Mining activity is crucial to the DRC economy. However, some mines are controlled by militant groups causing serious social and environmental issues in the region such as grave human rights abuses, theft, extortion, violence over control and taxation of mineral resources and forced child labour.

A new report by the International Peace Information Service (IPIS), an independent research institute devoted to peace and development in sub-Saharan Africa, states that out of the 800 mines in DRC, 200 are involved with armed groups and 265 are involved with the army.  Both of which impose illegal taxes on miners. Many of these mines are gold producing, which are targeted by the armed groups because of the hike in price of gold and the ease of smuggling gold. Gold along with tin, tantalum and tungsten (3Ts) make up the conflict minerals mined for in the DRC.

The IPIS report highlights that in spite of the implementation of the Dodd-Frank 1502, which requires U.S.-based companies to have due diligence of their supply chain so that they know and can trust in their gold supplier, it is still tough for these companies to retrieve all the necessary information. Plus, even once these businesses obtain the facts, it is hard for them to assess the data. Most international buyers have boycotted the “three T’s” from the region, but gold is easily melted down, so it is difficult to source what mine it came from. Many American companies acknowledge that it is just not that easy to keep track.

The exploitation of minerals is an important source of income for many communities in eastern Democratic Republic of Congo (DRC). Yet this mineral wealth also plays a significant role in the continuation of insecurity in parts of the country. Revenues from the mineral trade have given armed groups the means to operate, and wield power. While recognising that this mineral wealth is not the root-cause of the conflict here, their trade does play a central role in funding and fuelling conflicts in the DRC, further weakening the already fragile government.

Over recent years, several domestic, regional and international initiatives have been developed to address the so-called ‘conflict minerals’ problem and the approaches taken by these initiatives include the development of certification schemes, traceability systems and due diligence measures. However, when all is said and done, the Dodd-Frank 1502 ruling is a major victory in the fight to protect human rights in the DRC and is an important step towards improving corporate accountability globally.
Photo Credit: Julien Harneis

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