MINING Wolves guarding sheep
The corruption and inefficiency of government bureaucrats and troops in the eastern Democratic Republic of Congo (DRC) has presented a greater threat to small-scale artisanal miners than rebel militias have, according to a recent report by Southern Africa Resource Watch (SARW).
SARW estimates there could be between 370 000 and 600 000 artisanal miners in the DRC, mining for gold, copper, cobalt and other minerals.
SARW suggests the value of gold being produced by artisanals could be US$1bn$2bn/year, which more than justifies allocating more resources to protecting the miners physically and from extortion.
“While the exploitation of artisanal and small-scale miners continues, the identity of those responsible has now changed. They are no longer warlords and militia leaders but corrupt government administrators, members of the government’s military and security organisa-
46 tions, and many regional traders,” the researchers say.
The report, “Conflict Gold to Criminal Gold”, was released last week, just as news broke that a rebel group, M23, had taken control of Goma in the mineralrich Kivu province in eastern DRC.
Electronic items sold around the world need minerals from the eastern DRC region. Recently the US passed a Conflict Minerals Law, which has been incorporated into SEC regulations, forcing companies to disclose whether they are sourcing coltan, cassiterite, wolframite or gold from eastern DRC, and to prove their purchases have not been used to fund rebel groups.
SARW director Claude Kabemba says the report was written when there had been a decline in rebel activity. But the subsequent advances by M23 underscored the point made in the report, that unless the DRC government takes greater steps to protect the area, these levels of instability will recur.
Kabemba says it is likely the DRC government will have to negotiate a peace with the rebels but that won’t resolve the conflict permanently.
Enrico Carisch, who co-ordinated the SARW researchers, says there is no information about whether M23 has seized stockpiles from mineral traders or sought to extract money from them.
“Undoubtedly they will ask for taxes at some point — but that should not add extra costs, since it would merely replace the government’s levies.”
In 2002 the DRC government established three institutions around artisanal mining: Saesscam (Service for the Assistance & Supervision of Artisanal & SmallScale Mining); another to certify the value of minerals for tax before export; and a third to register title to mineral properties.
But while the other two are working, the first unit has never been properly funded and its employees are often not paid, so it has become a burden on artisanals.
“In the rankings of the most shameful government agencies, the SARW research puts agents of Saesscam at the top,” researchers say.
They say neither these institutions nor the US Conflict Minerals Law have improved the lot of artisanal miners because both are too ambitious and divorced from the realities on the ground.
SARW researchers found prices of essential goods tend to be high in gold mining areas because of a rush of immigrants, abandonment of farming, and the lack of roads to transport consumer goods (see table). Miners pay for their goods in gold, not currency, and traders exploit them by underpricing the gold and overpricing what they sell.
Small-scale miners in Manguredjipa report legitimate fees and taxes are being swelled by additional extortion from corrupt officials and the FARDC soldiers who are supposed to be protecting the area, which means they often give up complying with the law. “The authorities only come here to get our money,” said one artisanal miner.
Insecurity for the miners increases dramatically once the DRC troops arrive. Around Mongbwalu artisanals are mining without permits yet they are still being pressured to pay taxes.
Banro Gold Corp has mining operations in Twangiza and Namoya and the transition from informal to formal gold mining is viewed with fear by local communities, the report says. There’s little wider awareness of Banro’s initiatives to build roads, medical facilities, schools and water supply in fulfilment of its social obligations.
SARW says there will probably be benefits in future as foreign companies build large mines and infrastructure but at the moment there is heightened concern and sometimes anger against them, because of poor communication.