Conflict materials, used to fund armed rebels and violence, are found all over the world, often in countries with a long history of war, such as the Democratic Republic of Congo, which holds some of the richest mineral deposits.
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Minerals particularly associated with funding conflict are the ‘three T’s’ of tin, tungsten and tantalum, which are present in many everyday products such as smartphones and laptops.
Increased demand for technology has boosted the need for metals such as tantalum. Analysts at Technavio predict in their ‘Global Tantalum Market 2015-2019’ report that the global tantalum market will grow by 2.89% between 2014 and 2019.
But just as the market has changed, so the source of Tantalum has shifted too.
According to a report from the US Geological Survey, the source of tantalum has dramatically changed over the past few years. In 2000, Australia produced around 45% of the world’s tantalum concentrates (tantalum-containing minerals), but by 2014 this dropped to just 4%.
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By GlobalDataThe substantial decrease was a result of high extraction and an unfavourable exchange rate, which meant that mining the ore was no longer viable in Australia.
"The Australian mines, they had a high cost of extraction and so that’s part of the reason they shut down," says Responsible Trade president Mike Loch. "Because of the high cost of mining some of these areas, the DRC and Rwanda, became a location that people wanted to explore."
Congo’s violent history
In 2014 Rwanda was shown to have produced 50% of all global tantalum concentrates (and 25% of global tantalum metal), up from just 12% in 2000. Mining contributes to about 1.5% of Rwanda’s $7.8bn GDP, and the country has recently signed a five-year mining contract worth $39m with a unit of Oman’s Mawarid Mining to extract tantalum, tin and niobium.
The country now has a good reputation for mining and the Rwandan people see their mines as an asset. Unfortunately, it is a different story in the DRC. The country produced 17% of the world’s tantalum concentrates in 2014, nearly double the 9% it produced in 2000, but its society is fractured from decades of war. The government has historically had little control over the mining of minerals such as tantalum, and armed groups are constantly fighting for governance of mines and smuggling routes.
This has had tragic effects on the people of the country, which instead of reaping the rewards of the mineral-rich land, are controlled, murdered and raped by rebels. Since the 1990s, the DRC has had a string of presidents that have turned a blind eye to security guards, militia, and Congolese soldiers seizing authority of mines and lining their pockets with profits from mineral smuggling, while wielding weapons and perpetrating sexual violence against women.
The government is now run by Joseph Kabila Kabange who has made attempts to end the ongoing civil war by negotiating peace agreements. However, the borders remain battle zones, with troops trading minerals for weapons. There are also accusations that child labourers have been recruited to work in these often dangerous mining environments.
More than two million miners in Eastern Congo alone extract tantalum metal from coltan ore. The mineral is smuggled out of Congo through neighbouring countries including Rwanda and shipped to processing plants as far away as East Asia, before reaching smelters like Fogang Jiata Metals in China for refining.
Time to stop funding the bloodshed
Until relatively recently, companies such as Intel, HP and Apple haven’t had to trace the source of the tantalum that goes into their electronic devices, but this all changed with the Dodd-Frank Reform in 2010. The Act states that all companies registered with the US Securities and Exchange Commission have to disclose whether they are receiving tantalum, tungsten, tin, and gold from Congo, and whether those minerals are connected to sites of conflict.
Being ‘conflict-free’ means the mines are not run by violent rebel groups, there are no children or pregnant workers, and that miners are paid. This status is evaluated through an expensive certification process by a group called the Regional Certification Mechanism of the Intergovernmental International Conference on the Great Lakes Region.
The organisation must also determine whether any of its minerals originated in the other ‘covered countries’ of South Sudan, Uganda, Rwanda, Burundi, Tanzania, Malawi, Zambia, Angola and Central African Republic. Companies were first required to disclose this information from May 2014.
The Dodd-Frank Act spurred other international reforms by companies and governments to comply with the law. These include the Conflict-Free Smelter Program, and due diligence guidelines by the Organization for Economic Co-operation and Development (OECD), and the United Nations.
Finding the pinch point in the supply chain
Loch says that smelters are the ‘pinch-point in the supply chain’ because there are a finite number and thus conflict-free smelters can be easily accessed by companies on the Conflict-Free Sourcing Initiative website such as Molycorp Silmet in Germany and Metallurgical Products in India.
"The tantalum industry has done an outstanding job of embracing this programme," Loch says. "Over 95% of all tantalum smelters from a global standpoint are in the programme."
Loch says that, in contrast, some paper and forestry programmes which have been around for 15 to 20 years have achieved perhaps 10%-20% of their facilities involved.
"Here, the tantalum industry in five to six years has close to 100%," he says. "So the amount of emphasis and importance put on this is demonstrated there."
As of August 2015, 141 out of the 180 mines assessed so far are conflict-free, including the Kisengo coltan mine in Katanga and the Luwow mine in the mountains of the mineral-rich Masisi region, which employs 1,400 people.
There was some concern that the inconvenience would cause companies to stop trade with Congo altogether, which would be detrimental to the struggling Congolese economy that relies so heavily on mining – it’s an estimated 12% of Congo’s GDP.
However, the Enough Project investigated 14 mining locations in Eastern Congo, and reported that the Dodd-Frank reform was so far successful in forcing some companies to clean up their supply chains. The researchers interviewed 220 people in 14 mines and towns, and discovered that armed groups and the Congolese Army are no longer present at two-thirds (67%) of the tin, tantalum and tungsten mines they researched.
Dodd-Frank shortcomings and scepticism
With dozens of middle men, tracing the source and following the trail of tantalum from mine to processing plant, and smelter to factory can take a long time.. Intel, for example, took five years to fully research its supply chain.
It isn’t a cheap process either. Research from Turlane University and Assent Compliance in 2014 found that American companies spent around $709m and six million working hours last year to comply with the requirements and source their conflict metals.
Even with that expense, researcher Dr Chris Bayer from Tulane University studied the latest reports with Assent Compliance, a New York consulting firm, and found that not all companies that attempted to track their tantalum were successful.
The findings revealed that 90% of the 1,262 companies that were filed as having conflict metals in 2014 said they couldn’t determine whether they were in fact conflict-free. Two-thirds of the companies, including Google and Amazon, did not define the minerals’ country of origin, and only 314 (about 24%) reached full compliance with the Dodd-Frank Act.
Transparency, providing security and creating an environment are vital to attracting foreign investment into tantalum mining, which the Dodd-Frank Act cannot achieve on its own.
In fact, there has been criticism of the reform. In 2014, academics, researchers, activists and journalists published an open letter which stated that the relationship between mining and conflict is nowhere near as clean-cut as Dodd-Frank backers say.
For example, they write that the conflict-free campaign "fundamentally misunderstands the relationship between minerals and conflict" and that the Dodd-Frank Act might actually be harming rather than helping communities.
In an interview with Foreign Policy journal, one of the signatories, Ben Radley, said that while people far from Africa can ease their conscience by naming minerals as conflict-free, it induces hardship for the eight to ten million workers and families who rely on mining to earn a living.
This was apparent when the Congo’s Government shut down its mining industry for several months in order to comply with the law. Then, the process to certify the minerals as conflict-free was slow due to lack of political will and logistical delays.
A shared goal
Loch believes that, regardless of its direct impact, the Dodd-Frank reform has increased global awareness of the issue of conflict metals such as tantalum. He says that, while the NGO community did a very good job of convincing the public that electronics were the cause, the Dodd-Frank Act showed that this wasn’t necessarily the full picture. Although 50%-60% of the world’s tantalum ends up in electronics, many other industries use conflict metals in their products, including for apparel, medical devices and automotive production.
The European Union is also establishing its own regulations, similar to the Dodd-Frank Act, which are due to be released in the middle of this year. Loch says that this, along with the rest of the industry coming together, shows that people want a stable and fair market, which is ‘pushing the ball in the right direction’.
"It was really interesting that the industry came together to conflict-free sourcing initiative, to really help create the tools and mechanisms necessary," he says. "There’s a lot of good, good candid discussion that takes place because I think at the end of the day, people all want the same desired outcome."
Loch admits that his optimism is simplistic as there is still a lot to be done to stabilise the DRC’s economy and tackle conflict metals like tantalum. However, organisations that help minimise the threat and new laws that are put in place are a good start.
"It will never progress as much as it could with the proper security in the proper controls put in place," he says. "The journey of a thousand miles begins with the first step."
