Category Archives: Trade

Connecting the Congo, Consumers and Changing Fortunes?

After writing back in November about the connections between global consumerism and conflict minerals in the Democratic Republic of the Congo (DRC), I was delighted to read this week a report from the ENOUGH Project suggesting that militias in the DRC are ceding control of illicitly held mines. According to the report, legislation passed in the US in 2010 (known as the Dodd-Frank Act) that requires companies to specify the origin of minerals used in their products has had a significant impact.

“Armed groups and the Congolese army are no longer present at two-thirds (67 percent) of tin, tantalum, and tungsten mines surveyed in eastern Congo’s North Kivu, South Kivu, and Maniema provinces, according to a major international survey followed up by Enough Project field investigations. By contrast, in 2010, before the passage of Dodd-Frank, “In the Kivu provinces, almost every mining deposit [was] controlled by a military group,” according to the U.N. Group of Experts on the DRC” – Enough Project

As a result of the legislation and industry audits, a two-tier market has been created for tin, tantalum and tungsten (which are used in electronics produced by companies like Apple and Intel), and minerals that are not traded as part of conflict-free programmes now sell for 30% to 60% less. This means that the profits that militia groups can derive from control of these minerals have diminished significantly and that the illegal operations are much less economically viable.

This progress demonstrates the power that consumers, with the help of transparency-promoting legislation, can bring to bear in order to address global issues. With supply chain information being disclosed, and companies being aware of the public relations implications of being connected with militias in the DRC, the case for such companies to support the implementation of validation processes in Congolese mines is compelling.Intel is now producing the world’s first fully conflict-free product containing Congolese minerals, while Apple has validated its tantalum supply chain as conflict-free.

Encouragingly, the ENOUGH project suggests  that most former miners have been able find other sources of income, though more can be done to facilitate entrepreneurship for ex-miners. This should be a crucial factor in assessing the success and appropriateness of the Dodd-Frank Act. Moreover, questions need to be asked about the impact of the legislation on demand for minerals from the DRC and on the livelihoods of artisanal miners.

Additionally, thought must be given to the implementation of similar reforms in the gold mining industry, in which armed groups remain heavily involved.

Read the full ENOUGH Project report here

The Biofuels Agenda: Who is driving it? Where is it going?

Jatropha fruit. Image credit: Ton Rulkens
Jatropha fruit. Image credit: Ton Rulkens

The biofuels agenda highlights the importance of looking at power and politics in order to understand international decision-making in a globalised world. Few agendas show so clearly the linkages between environmental, social and economic concerns (such as climate change, poverty and profit) and our willingness to act against our long-term interests.

If a politically meaningful movement towards a paradigm of sustainable development really existed, the biofuels agenda would mark a critical juncture in that movement. Leaders would make decisions that reflect a long-term perspective, with due consideration of issues such as climate change, food security, and the voices of those stakeholders that have the most to lose. Unfortunately, this is not the case. Despite growing concern over the environmentally and socially damaging consequences of biofuels, EU proposals on November 29th of this year look set to increase a proposed cap on production from 5% to 7%.

It’s easy to see why biofuels are an attractive option. In one sense, they are an ideal substitute for fossil fuels: existing vehicle technology requires little or no modification in order to use them. Energy security concerns, high oil import costs and carbon emissions reduction targets have also contributed to increasing demand.

But the mounting evidence against biofuels is impossible to ignore.

  • While the EU’s 2009 Renewable Energy Directive (RED) (which promotes biofuels) was designed, at least in part, to ‘greenify’ energy-use in Europe by reducing the greenhouse gas emissions associated with fossil fuels, a growing body of research suggests that biofuels can lead to an overall increase in greenhouse gas emissions (as a result of land-use changes).
  • By diverting important crops, like wheat and maize, away from food markets, biofuels cause food prices to increase. Biofuels production contributed to dramatic increases in the 2007-2008 food crisis, which led to riots in 31 countries. In the aftermath of the crisis, Jean Zieger, former UN Special Rapporteur on the Right to Food, described biofuels as a ‘crime against humanity’.
  • Rising food prices and growing demand for biofuels make land an attractive investment opporutnity. Large-scale land deals often occur in rural areas in developing countries where people may not have legally recognised land rights. Poor people can find themselves powerless in the face of large foreign corporations, and ultimately end up dispossessed of the land on which they rely.

The fact that industrial biofuels production is being promoted despite (or without due regard for) the potential consequences shows that policymaking in Europe is not entirely evidence-based. It is also indicative of a severe power imbalance in decision-making. While there is a wide range of stakeholders that stand to be affected by the biofuels agenda, not all stakeholders have equal power in shaping that agenda.

Corporate interests have had a significant influence. Biofuels TP, for example, an industry organisation, was funded by the EU in 2006 to assist in the formulation of Europe’s biofuels strategy up until 2030. Commentators at the time observed that the organisation’s steering committee lacked civil society representation, and was made up almost entirely of industry representatives. Furthermore, suggestions were made that the evidence was found to support the 10% target in the EU, rather than the other way around.

Maybe it shouldn’t be surprising then that profit is being prioritised over environmental issues and the concerns of the poor. And while negotiations among EU member states in November and December of this year looked like an opportunity to respond to the evidence and mounting calls against biofuels, maybe it should come as no surprise that effective corporate lobbying has again proven influential.

The biofuels agenda makes it clear that sustainable development will require policymakers and civil society to understand the roles of power and politics in shaping planning processes. Care must be taken to increase the bargaining power of people in rural areas in developing countries. Civil society organisations must be involved in decision-making. Corporate interests must not be allowed to dominate. And political leaders and governmental institutions must understand and uphold their obligations to protect the poor and vulnerable and make decisions that promote sustainable development.

It’s worth noting that, under the right circumstances, biofuels could play a positive role in reducing our reliance on fossil fuels, and even reducing poverty. Smallholder production, inclusive business models, recognition of traditional land rights, and ecologically appropriate crops and processing techniques could help avoid the negative consequences. But this again highlights the need to take into account the influence of power and politics. These concerns will always take the backseat as long as short-term political and corporate interests dominate the agenda.

Related links:
Have a look at Karl Mathiesen’s excellent analysis of the biofuels debate for the Guardian

Connecting the Congo, Conflict and Consumers

Image: ENOUGH Project
Image: ENOUGH Project

Given Rwanda’s status as an “aid darling” in the eyes of Western donors (who like to present the country’s social and economic progress since the genocide in 1994 as a triumph of foreign aid), the suspension of aid by several donors in 2012 delivered a strong message. The suspension was a response to UN findings that Rwanda was arming and supporting a violent uprising by rebel group M23 in the Democratic Republic of the Congo (DRC).

In what looks like a positive development, the Congolese army declared victory over M23 on November 5th, 2013; putting an end to a bloody deadlock that it had been engaged in since April 2012. Although the Congolese effort was buoyed by significant support from a UN peacekeeping mission in the country (which had a mandate to use deadly force), the decisive factor in the victory is being attributed to Rwanda’s decision to pull the plug on its support of M23. Maybe international pressure had the desired effect.

But in terms of changing the fortunes of a country where a scramble for resources has become intertwined with ongoing poverty, conflict, and mass rape, is it enough to focus solely on the local and regional actors involved? In other words: are we in the West looking closely enough at our own role in fuelling the conflict?

In theory, the Congo should be a very wealthy country. In addition to its abundant supply of water and fertile soil, it sits on a vast store of valuable minerals, including oil, diamonds, tantalum, tungsten, gold, and the ores that produce tin. The latter four of those minerals are used in electronic devices such as mobile phones and computers that are sold worldwide.

The tragic reality is that the Congo is followed only by Niger at the bottom of the Human Development Index. In a country ravaged by poverty, more than five million people have died as a result of conflict since 1998, and millions of others have been raped. At the same time, militias earn hundreds of millions of dollars each year by smuggling conflict minerals to neighbouring countries, from where they are shipped abroad and smelted.

The implication is clear. Consumers of electronic devices (myself included), the substantial majority of which live in developed economies, are fuelling the conflict in the Congo and financing its perpetrators and the atrocities they carry out.

Producers of electronic devices, such as Apple, claim that they have little control over whether or not conflict minerals are used in their products. They argue that the supply chains are too complex for transparency because of the number of actors involved. Without transparent supply chains, these companies cannot guarantee to consumers that the products they sell are free from conflict minerals.

Is it good enough to say “it’s too complex” and leave it at that? I don’t think so. I find it hard to believe that electronics giants like Apple, who pride themselves on being innovative market leaders, would not be able to respond to market pressure to ensure their products are conflict mineral-free.

It certainly wouldn’t be the first time that consumer pressure resulted in changes in the supply chain policies of large corporations. In the 1990s Nike was forced through pressure from its customers to address the use of child labor in its factories. Earlier this month, Coca-Cola announced that it would cut off any suppliers that do not follow guidelines designed to protect the land rights of rural communities.

While there an obvious need for a coordinated effort to address how we source minerals in the Congo, fortunately some action is being taken. The ENOUGH Project, which has worked extensively on the issue of conflict minerals, argues that through tracing, auditing and certification, companies can ensure that the minerals they source are not coming from mines controlled by armed groups. In addition, the organisation has launched a campaign, Raise Hope for Congo, which aims to build awareness of the role of conflict minerals in the conflict, and to develop policy recommendations for the U.S government. Have a look at the video below for some more information.