Pact Urges Responsible Companies to Start Buying Conflict-Free Minerals from Eastern DR Congo

KIGALI, RWANDA | MARCH 15, 2012 -- The New Times in Rwanda reports that African Primary Tungsten (APT) was suspended from the iTSCi traceability and due diligence system while four unidentified companies were suspended by Rwanda's Geology and Mines Department (GMD). The ITRI Tin Supply Chain Initiative (iTSCi) is designed to address concerns of trade in "conflict minerals" from the Democratic Republic of Congo (DRC) and neighboring countries, including Rwanda. This suspension shows that the governance structure that the iTSCi system provides helps authorities regulate the mining sector and detect potentially illegal activity. It is essential to expand these traceability and regulatory efforts to enable mining zones such as Eastern DRC to become viable sources for responsible buyers, who, currently, have abandoned the market.

Since the spring of 2010, Pact has been working with the international tin industry association ITRI, the Tantalum-Niobium Study Center T.I.C., local and national authorities, local and international businesses, miners, and civil society to implement the iTSCi program in the DRC and adjoining countries. iTSCi allows buyers along the supply chain to determine the source of minerals mined and traded in the Central African Great Lakes Region and thus enables companies, authorities, and other stakeholders to detect and avoid "conflict minerals," conforming to the requirements of the U.S. Dodd-Frank law and the OECD guidelines.

APT was suspended after investigations found evidence of unauthorized tagging activity occurring at the APT depot in Kigali. The New Times quotes Michael Biryabarema, the director general of the Geology and Mines Department (GMD): "Whoever is caught in the act of using tags illegally, be it our staff or from companies shall face the full force of the law. If we want to improve our sector and make it more vibrant, transparency is the way to go." According to Dr. Biryabarema GMD has referred APT's case to the Rwanda Criminal Investigation Department (CID) for further investigation.

Gregory Mthembu-Salter, former consultant to the UN Group of Experts on DRC, called this "a very welcome development that shows that due diligence, when backed by strong government commitment, can improve natural resource governance and help remove conflict minerals from the supply chain."

The Rwandan example, along with improved livelihoods and increased tax revenue seen in DRC's Katanga Province after the implementation of iTSCi also underscore the system's potential to contribute to reforming the mineral sector and improving people's lives. As Assheton Carter, Pact's Senior Vice President for Global Engagement points out: "Areas were iTSCi is up and running show a markedly different level of economic activity than sites where there is no traceability. There are now some 45,000 artisanal miners making a living, legally exporting hundreds of tons of traceable minerals from non-conflict sources in the region every month. The Congolese provinces of North Kivu, South Kivu, and Maniema in particular need resources to reverse the unintended adverse effects of the U.S. Dodd-Frank legislation. Areas which are now under a de facto embargo and where local people depended on artisanal mining for their livelihoods are experiencing lost revenues, unemployment, smuggling, fraud, displacement, and increased pressure on other commodities. Responsible companies who are willing to buy conflict-free minerals from the region urgently need to show their commitment: unless a transparent and legal mineral market can be re-started, the very people the law sought to protect and assist will continue to suffer the most."

Pact's Mines to Markets (M2M) program is based on the premise that the extractives sector can improve livelihoods for poor people and be a driver of development in marginalized communities. Pact believes this to be true in the African Great Lakes Region, where despite the negative associations with conflict, the minerals trade is the economic backbone and some 20% of the Congolese population depends on it for their survival. M2M is working in the Great Lakes to transform the largely unregulated, obscure mineral trade into a market-driven, locally and internationally supported, credible sector that respects human rights and environmental values, operates legally, and benefits people and communities as well as legitimate businesses.

About Pact:

Pact enables systematic solutions that allow those who are poor and marginalized to earn a dignified living, be healthy, and take part in the benefits nature provides. Pact accomplishes this by strengthening local capacity, forging effective governance systems and transforming markets into a force for development. Pact is a 501(c) (3) nonprofit organization based in Washington, D.C. Visit us on the web at www.pactworld.org