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Friday, 30 December 2011 - Conflict minerals crackdown backfiring in Congo: U.N. |
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Tweet Share this Email Print Related News Gunfire in Congo after Kabila wins disputed poll Sat, Dec 10 2011 Congo's Kabila re-elected, opposition claims victory Fri, Dec 9 2011 Analysis: Loophole in blood diamond monitoring scheme exposed Fri, Dec 9 2011 Analysis & Opinion Insight: Islamist attacks strain Nigeria’s north-south divide Stopping the Stop Online Piracy Act Related Topics World » United Nations » Congo » By Jonny Hogg and Graham Holliday KINSHASA | Fri Dec 30, 2011 11:07am EST KINSHASA (Reuters) - A U.S. crackdown on so-called "conflict minerals" in eastern Democratic Republic of Congo has backfired by pushing trade deeper into the hands of criminals and smugglers, including at least one former rebel leader, a U.N. report said on Friday. The finding underscores the difficulty faced by both the United States and Congo governments in choking off funding to eastern Congo's roving armed bands, believed responsible for thousands of rapes and killings of villagers. In an effort to pressure Congo's rebels, the United States adopted a law last year requiring the Securities and Exchange Commission to write rules forcing companies to prove minerals they derived from Congo are "conflict free." But the rules have not been finalized due to wide opposition from companies and industry groups, creating uncertainty that has led international trading firms to virtually stop all purchases from Congo. "(This) has mainly led to a loss of production and increased criminality, which I think everyone would agree is not a great result," Gregory Salter, who worked as a consultant for the United Nations report, told Reuters. Eight years after the official end of a war that killed more than five million people, Congo has struggled to tackle rebel groups and criminal elements within its own armed forces that haunt the densely forested east and enrich themselves on illegal mining. Congo has some of the world's largest deposits of minerals including tin and coltan used in making cell phones and computers, but decades of conflict and corruption mean most of the population remains mired in poverty, a situation made worse by "conflict mineral" crackdown, the UN's Group of Experts report noted. "This refusal (by international companies) to purchase untagged material left many exporters... bereft of their main, or only customers, and therefore incomes," the group stated. Congo exports dropped by around 90 percent following the decision by firms not to accept minerals from the region, mining officials told Reuters earlier this year "(It) appears to have increased the need for fraudulent operators to seek or accept military assistance in their mineral smuggling operations," the report continued. A former rebel, who is now a general in the Congolese army, is implicated in illegal mineral trafficking, the group said. Bosco Ntaganda, who is subject to an ICC arrest warrant for war crimes, controls the supply of minerals from the Congolese city of Goma into neighboring Rwanda, which has seen a rise in smuggling in 2011, the report stated. "The level of recorded domestic production of tin, tungsten and tantalum ores (in Rwanda) continues to be higher than industry analysts consider the real level of production to be... suggesting that material from the DRC is being smuggled into Rwanda, and then tagged as of Rwandan origin," the report said. Mineral exports from Rwanda are expected to reach $150 million by the end of 2011, up from $118 million in the last financial year between July 2010 and July 2011. Last month Rwanda returned more than 80 tonnes of minerals to Congo and Rwandan officials have told Reuters that the tagging system, which allows minerals to be traced back to their mine of origin, is working at "nearly 100 percent." Congo's armed forces have faced repeated allegations of operating illegal mining rackets, and last year Congolese president Joseph Kabila suspended mining in the region for six months in an effort to demilitarize the industry. Congolese Minister of Mines, Martin Kabwelulu, has dismissed accusations that the Congolese army were involved in illegal mining as "rumors" but said he backed the U.S. legislation to clean up the mining sector. "For me the Dodd-Frank law is very good, because it stops the criminals from working," he told Reuters by text message. (Writing by Richard Valdmanis) World United Nations Congo Tweet this Link this Share this Digg this Email Reprints   We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/ Comments (0) Be the first to comment on reuters.com. Add yours using the box above.   Edition: U.S. Africa Arabic Argentina Brazil Canada China France Germany India Italy Japan Latin America Mexico Russia Spain United Kingdom Back to top Reuters.com Business Markets World Politics Technology Opinion Money Pictures Videos Site Index Legal Bankruptcy Law California Legal New York Legal Securities Law Support & Contact Support Corrections Advertise With Us Connect with Reuters Twitter   Facebook   LinkedIn   RSS   Podcast   Newsletters   Mobile About Privacy Policy Terms of Use Our Flagship financial information platform incorporating Reuters Insider An ultra-low latency infrastructure for electronic trading and data distribution A connected approach to governance, risk and compliance Our next generation legal research platform Our global tax workstation Thomsonreuters.com About Thomson Reuters Investor Relations Careers Contact Us   Thomson Reuters is the world's largest international multimedia news agency, providing investing news, world news, business news, technology news, headline news, small business news, news alerts, personal finance, stock market, and mutual funds information available on Reuters.com, video, mobile, and interactive television platforms. 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