EU shuns DRC minerals
September 6, 2013
The EU says it is concerned about "blood minerals" making their way to Europe. It has joined the US in targeting minerals from conflict zones like the eastern Democratic Republic of Congo (DRC).
The EU trade commissioner for trade, Karel de Gucht, said European economies need conflict-free mobile handsets. "I know the Congo quite well. I have been there and often met with President Kabila," said Karel de Gucht, a former Belgian foreign Minister.
In 2008, de Gucht threatened to withdraw aid to DRC if President Joseph Kabila didn't address issues of governance. This led to a diplomatic crisis between the DRC and its former colonial power Belgium.
President Kabila declared him a ‘persona non grata'. Since then, de Gucht no longer enjoys the good relations with Kinshasa that enabled him to secure mining licenses for prospective clients.
His opinion of President Kabila has not changed. And in his capacity as the EU trade commissioner, Karel De Gucht, hasn't been allowed to enter the DRC since 2010.
Commodity trading finances civil war
Now Karel de Gucht wants to proceed with a new initiative against the intolerable conditions in the ore mines in the eastern Congo. The EU wants to emulate the new U.S. model following the import of rare metals such as coltan from the Congo.
"You need trade to survive. But sometimes it brings you into contact with conditions that you would not tolerate any minute at home," said Karel De Gucht.
Militias, rebels and government troops continue to fight each other in eastern Congo.
The mines are under extremely dangerous conditions and children have to break down the mineral ores under the watchful eyes of the militias.
"The situation in the Congo is very complicated," Karel de Gucht points out.
The United States calls for complete proof of business
In the US and other industrialized nations protest groups have been formed, calling on large companies like Apple, Microsoft and Samsung to sell products that are conflict free.
The rare minerals from the Congo are used in the manufacturing of mobile phones, computers, electronic equipment and cars.
In the US, the Dodd Frank Act requires persons or a company to disclose the source of raw materials such as tantalum, tungsten or gold from the mine to final production, especially minerals coming from the DRC.
A study conducted by the Öko-Institut in Freiburg, found that the Dodd- Frank Act could lead to cases where the company would to completely withdraw from doing business with the Congo.
“The required proof is simply too expensive and too complicated,” said Andreas Manhart from the Öko-Institut.
“Best evidence can only be achieved if we rethink strategies for mandatory origin of the whole production chain.”
This means not only the illegal mines run by rebels would be considered but also other regular mines.
German economy resists strict conditions
The Federation of German Industries (BDI), has also criticized the conditions in the Congo as well. Ulrich Grillo who heads the federation, believes that certification of raw materials and limiting exports from eastern Congo , will not bring any meaningful change.
“The UN group of experts confirmed that the trade of minerals in the eastern part of the Democratic Republic of Congo was partially used to finance the ongoing conflicts,” said Grillo, “the past and present conflicts were not caused by minerals.”
The BDI and the Öko-Institut urge the European Commission to work together rather than simply imitating the Dodd- Frank Act in the U.S. for European companies.
EU seeks “viable” remedy
Commissioner De Gucht will submit the bill with all stakeholders in the coming year after intensive discussions. “We need to find a system that is feasible,” said de Gucht.
"De Gucht quoted a research institute that estimates that 20 percent of all wars were related to the world of raw materials.
The U.S. Securities and Exchange Commission will also soon present a first report how the Dodd- Frank Act has impacted the American public companies trading with the Congo.