Tag Archives: diamond trade

At Gunpoint in Congo: Is Coltan Worse than Oil?

Tantalum, a metal used in smartphone and laptop batteries, is extracted from coltan ore. In 2019 40% of the world’s coltan was produced in the Democratic Republic of Congo, according to official data. More was sneaked into Rwanda and exported from there. Locals dig for the ore by hand in Congo’s eastern provinces, where more than 100 armed groups hide in the bush. Some mines are run by warlords who work with rogue members of the Congolese army to smuggle the coltan out.

When demand for electronics soared in the early 2000s, coltan went from being an obscure, semi-valuable ore to one of the world’s most sought-after minerals. Rebels fought over mines and hunted for new deposits. Soldiers forced locals to dig for it at gunpoint. Foreign money poured into Congo. Armed groups multiplied, eager for a share.

Then, in 2010, a clause in America’s Dodd-Frank Act forced American firms to audit their supply chains. The aim was to ensure they were not using minerals such as coltan, gold and tin that were funding Congo’s protracted war. For six months mines in eastern Congo were closed, as the authorities grappled with the new rules. Even when they reopened, big companies, such as Intel and Apple, shied away from Congo’s coltan, fearing a bad press.

The “Obama law”, as the Congolese nickname Dodd-Frank, did reduce cash flows to armed groups. But it also put thousands of innocent people out of work. A scheme to trace supply chains known as ITSCI run by the International Tin Association based in London and an American charity, Pact, helped bring tentative buyers back to Congo.  ITSCI staff turn up at mining sites to see if armed men are hanging about, pocketing profits. They check that no children are working in the pits. If a mine is considered safe and conflict-free, government agents at the sites put tags onto the sacks of minerals. However, some unscrupulous agents sell tags on the black market, to stick on coltan from other mines. “The agents are our brothers,” Martin says. It is hard to police such a violent, hilly region with so few roads. Mines are reached by foot or motorbike along winding, muddy paths.

For a long time those who preferred to export their coltan legally had to work with itsci, which held the only key to the international market. Miners groaned that itsci charged too much: roughly 5% of the value of tagged coltan. When another scheme called “Better Sourcing” emerged, Congo’s biggest coltan exporter, Société Minière de Bisunzu, signed up to it instead.

Excerpts from Smugglers’ paradise: Congo, Economist, Jan. 23, 2021

Natural Resource Curse – Central African Republic

Gold and diamond sales are being used to finance conflict in Central African Republic and United Nations peacekeepers should monitor mining sites to clamp down on illicit trade, a U.N. panel of experts * [pdf]said.In a report, the panel also said the peacekeeping mission (MINUSCA) should deploy troops to the remote north of the country and use drones to monitor the rebel-controlled region to put an end to simmering violence there.  The mission, which launched in September, is operating at only two-thirds of its planned 12,000-strong capacity.

Central African Republic was plunged into chaos when northern, mostly Muslim Seleka rebels seized control of the majority Christian country in March 2013, prompting a vicious backlash by the largely Christian ‘anti-balaka’ militia.  The panel said that some 3,000 people had been killed between December 2013 – when the U.N. Security Council imposed an arms embargo – and August 2014.  The Kimberley Process – a group of 81 countries, including all the major diamond producers, formed to prevent ‘blood diamonds’ from funding conflict – imposed an export ban on raw gems from Central African Republic in 2013.  But since then, an additional 140,000 carats of diamonds, valued at $24 million, had been smuggled out of the country, the panel estimated…..

In their northern enclave, the former Seleka fighters are imposing taxes on a wide range of goods from gold mining to coffee, livestock, and diamonds to fund their operations, the report found.  Former Seleka fighters were issuing mining licences to gold miners at the Ndassima mine near the rebels’ headquarters of Bambari, in the centre of the country, it said…

It suggested that interim President Catherine Panza’s decision to name representatives of the armed groups to cabinet roles may have fuelled conflict.”Competition among political representatives of armed groups for ministerial positions, as well as among military commanders for control of resources, accounts for of the recent infighting between former components of Seleka and rival factions of anti-balaka,” said the report, dated Oct. 29 but only made public this week.

Excerpts, Gold, diamonds fuelling conflict in Central African Republic, Reuters, Nov. 5, 2014

*Letter dated 28 October 2014 from the Panel of Experts on the  Central African Republic established pursuant to Security Council  resolution 2127 (2013) addressed to the President of the Security Council [S/2014/762]