Tuesday, January 24, 2012

China and Conflict Minerals in the DRC

OK, it's not really all about China, but an excellent analysis, "What's Wrong with Dodd-Frank 1502?" commissioned by the Center for Global Development and written by Laura Sesay, Congo expert, professor, and aka blogger "Texas in Africa" uncovers the pitfalls of (ineptly) trying to legislate good things for the conflict torn eastern Congo. From the abstract:
Although its provisions have yet to be implemented, section 1502 of the Dodd-Frank Wall Street Reform and Consumer Protection Act is already having a profound effect on the Congolese mining sector. Nicknamed “Obama’s Law” by the Congolese, section 1502 has created a de facto ban on Congolese mineral exports, put anywhere from tens of thousands up to 2 million Congolese miners out of work in the eastern Congo, and, despite ending most of the trade in Congolese conflict minerals, done little to improve the security situation or the daily lives of most Congolese.

In this working paper, sponsored by Todd Moss, Laura Seay traces the development of section 1502 with respect to the pursuit of a conflict minerals-based strategy by U.S. advocates, examines the effects of the legislation, and recommends new courses of action to move forward in a way that both promotes accountability and transparency and allows Congolese artisanal miners to earn a living.
H/T to Duncan Green, at Oxfam UK's "From Poverty to Power" blog. 

1 comment:

  1. No link with China?
    Sorry, but as always there is a direct link with China!
    A very good study but still very superficial.
    Grosso-modo I assume that you can find as much defenders as opponents of Frank Dodd. One defender is f.e. the Congolese Catholic Church.
    The study is f.e. superficial when she mentions the CNDP of Laurent Nkunda but does not speak of the deal between Kabila and Kagame by which Nkunda has been replaced by a wanted war criminal, general Bosco Ntaganda, and was then incorporated into the Congolese army as the n° 2 in command, the easiest way to have acces to a lot of new mines.
    There is an English saying which states that "all politics are local" and OK, you have the failure of the Congolese State and the army which is used as a highway to riches, but the solution to the problems in the Kivus is located in the Kivus and then you need the best studies, such as of Séverine Autesserre (referred to in this study) or of Koen Vlassenroot.
    And China then? Wel, as could be expected when there are commodities in play, China Inc. can’t be far away….
    Nowadays only Chinese buyers are still buying, especially tin and coltan, admittedly against dumping prices 20 à 30% lower than before the ban by the Congolese Government, and even uranium with a higher radiation risk (up to 5% and more where Western buyers limited this to 2% for security reasons) …
    Of the 25 buyers who were active in Goma, there remain only 3, Chinese offices that buy for the Chinese market and just respect the win/win principle without asking any questions…

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