From Mine to Mobile Phone: The Conflict Minerals Supply Chain

 

Enough experts lead you down the path of the 3Ts—tin, tantalum, tungsten—and gold from the mines of Eastern Congo all the way to your cell phone.

 STEP 4: TRANSIT COUNTRIES

Origins Obscured

Gold powder is tested and weighed within dealerships.
Source: Grassroots Reconciliation Group / Sasha Lezhnev

“The border patrols don’t check when you come across from Congo. Then you sell at one of two houses here [in Uganda]. They never ask for papers about where the gold comes from. Then they sell to Dubai. This business is very big, millions of dollars.” -Frank, former minerals smuggler, Kampala, Uganda

From the exporter the minerals are sent mainly by road, boat, or plane to the neighboring countries of Rwanda, Uganda, and Burundi.[10] Some minerals are legally exported, with taxes paid to the Congolese government, while others are smuggled across Congo’s porous borders. Either way, conflict minerals form a major portion of the trade.

Vast inconsistencies in the statistics recorded by neighboring countries attest to the scale of the smuggling, as minerals from Congo are labeled as having originated in Uganda, Rwanda, or Burundi. For example, Uganda officially produced less than $600 worth of gold in 2007, yet exported over $74 million worth of gold.[11] Similarly, Rwanda produced $8 million worth of tin ore but officially exported at least $30 million of tin.[12]
 
Congolese sellers either working independently or sent by the exporting companies work with buying houses and companies in Rwanda, Uganda, and Burundi. In Uganda and Burundi, these shops are unmarked houses. In Rwanda, buying companies mix Congolese minerals with those produced by Rwandan mines. In all three countries, the companies’ proprietors rarely ask questions about where the minerals come from.  

In Uganda and Burundi, buying shops also work closely with officers in the security services—the army and police of the country—so that their investments are “protected.” Military officers receive cuts from this trade, and use their security connections to keep business flowing smoothly. This climate of repression and the real threat of violence is enough to dissuade most whistleblowers. Some of these traders have been put on United Nations sanctions lists for trading in conflict minerals, so they maintain underground profiles to avoid the spotlight and further sanctions.  
 
There is nothing inherently wrong with neighboring countries importing and exporting Congolese minerals, but given the history of regional governments direct involvement in the illicit minerals trade, linkages between these governments and business and military elites who dominate the trade, and the continuing lack of transparency and due diligence on the part of these governments, much greater scrutiny of this step in the trade is necessary. These countries should insist that verifiable documentation accompanies the minerals, documenting the chain of custody to ensure that they are conflict free, and that they have been legally taxed by the Congolese authorities. Moreover, they need to start holding smugglers to account. The government of Rwanda has recently started a program to certify the origin of much of Rwanda’s domestic mineral production. This is a step in the right direction and full implementation of this policy by all minerals companies in the country, as well as in Uganda and Burundi, should be encouraged.