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Thursday, July 26, 2012

Conflict Minerals in Central Africa: U.S. and International Responses


Nicolas Cook
Specialist in African Affairs

“Conflict minerals” are ores that, when sold or traded, have played key roles in helping to fuel conflict and extensive human rights abuses, since the late 1990s, in far eastern Democratic Republic of the Congo (DRC). The main conflict minerals are the so-called the “3TGs”: ores of tantalum and niobium, tin, tungsten, and gold, and their derivatives. Diverse international efforts to break the link between mineral commerce and conflict in central Africa have been proposed or are under way. Key initiatives include government and industry-led mineral tracking and certification schemes. These are designed to monitor trade in minerals to keep armed groups from financially benefitting from this commerce, in compliance with firm-level and/or industry due diligence policies that prohibit transactions with armed groups.

Congress has long been concerned about conflicts and human rights abuses in the DRC. Hearings during successive congresses have focused on ways to help end or mitigate their effects, and multiple resolutions and bills seeking the same goals have been introduced. Several have become law. The most extensive U.S. law aimed at halting the trade in conflict minerals, specifically the 3TGs, is Section 1502 of Title XV of the Dodd-Frank Wall Street Reform and Consumer Protection Act (P.L. 111-203). Among other ends, Section 1502 requires the Securities and Exchange Commission (SEC) to issue rules mandating that SEC-regulated businesses that use conflict minerals in their products:

  • report if they obtained their mineral supplies from the DRC or nearby countries; 
  • be permitted to label as “DRC conflict free” products that they can credibly demonstrate do not incorporate minerals sourced in a manner that directly or indirectly finances or benefits armed groups in DRC or adjoining countries; 
  • publicly report to the SEC on those of their products which do incorporate minerals that are not “DRC conflict free”—and which may not be labeled as such—and on diligence measures used to obtain these minerals. 
Section 1502 raises complex rule design, compliance, cost estimate, and implementation questions, and Section 1502 advocates and critics—many politically influential—have been urging the SEC issue rules favorable to their respective views and interests. The complexity of the matters at issue and diversity of interests affected have prompted the SEC to repeatedly delay issuance of a final rule, although it is expected to act on the matter in mid-August 2012. Key rulemaking issues under debate include:

  • timing and a possible phase-in of rule implementation; and 
  • what due diligence standards are to be used. 
There is widespread support for use of due diligence guidelines developed by the Organization for Economic Co-operation and Development (OECD) in eventual Section 1502 rules, both to ensure complementarity between U.S. and international conflict mineral trade abatement efforts, most of which employ the OECD guidelines, and to enable these schemes to mature.

The State Department has provided to Congress a strategy aimed at breaking the link between mineral trade and conflict and, together with the U.S. Agency for International Development, is implementing programs in central Africa to support tracking and certification schemes; local small-scale mining communities; anti-mining labor abuse efforts; and related ends.

In the short to medium term, Congress is likely to closely monitor Section 1502 rule-making and the effectiveness of any eventual rule and other conflict mineral-focused programs as they are implemented. Implementation is likely to be complex. While substantial financial and applied efforts are being invested in such efforts, conflict in eastern DRC has long posed a complex set of intractable security, governance, and human rights challenges, which such efforts alone are unlikely to overcome—and may complicate. An example of a possible unintended consequence of Section 1502 is a de facto buyers’ boycott of minerals from eastern DRC attributed to the delayed rule-making process and to other factors. It has generated a local economic crisis and increased smuggling of minerals, but also reportedly reduced conflict funding and spurred conflict mineral trade control efforts.


Date of Report: July 20, 2012
Number of Pages: 38
Order Number: R42618
Price: $29.95

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Monday, July 2, 2012

Madagascar’s Political Crisis

Lauren Ploch
Analyst in African Affairs

Nicolas Cook
Specialist in African Affairs

Madagascar, an Indian Ocean island country, ranks among the world’s poorest countries; is the world’s fourth-largest island; and is extremely biologically diverse, with thousands of unique species of flora and fauna. It has experienced political instability since early 2009, initiated by tensions between the country’s last elected president, Marc Ravalomanana, and an opposition movement led by Andry Rajoelina, then the mayor of the capital city, Antananarivo. Mass protests in early 2009 and eventual military support for the ouster of President Ravalomanana culminated in his forced resignation from office. Rajoelina then seized power and, with other leaders, formed an interim self-declared transitional government, the High Transitional Authority (HAT, after its French acronym). Ravalomanana now lives in exile in South Africa.

Periodic protests by Ravalomanana supporters after the takeover led to violent clashes with security forces. Negotiations between the parties led to the signing of an agreement in 2009 in Maputo, Mozambique, to establish an inclusive, transitional government, but Rajoelina subsequently appointed a cabinet seen to be primarily composed of his own supporters. Southern African leaders and Madagascar’s opposition parties rejected the proposed government, and negotiations resumed. Two later agreements also failed to result in a unified transitional process.

The unconstitutional change of power and resulting political impasse have negatively affected economic growth and development efforts and strained Madagascar’s relations with international donors. Foreign governments, including the United States, reacted to Rajoelina’s seizure of power by sanctioning the government in various ways (e.g., through suspension of membership in some multilateral bodies, restrictions on aid, personal sanctions on some individuals, and removal of trade benefits). Aid restrictions have significantly decreased public spending. As a result of the coup d’├ętat, U.S. aid is restricted to selected humanitarian and development programs delivered through non-governmental channels. Madagascar’s Millennium Challenge Account compact, worth an estimated $110 million, was terminated in May 2009. Madagascar is also subject to aid restrictions due to its poor performance in addressing the problem of trafficking in persons.

Until September 2011, when a Southern African Development Community (SADC)-mediated transitional roadmap was signed by most key political movements, international mediation and national efforts to agree upon a transition process had foundered. Notwithstanding continuing political disputes, implementation of the roadmap has gone relatively smoothly. In April, a political amnesty law was enacted, but it remains controversial, as it does not cover former president Ravalomanana due to his conviction for murder in absentia in August 2010; he has not been permitted to return to Madagascar. An impasse over these issues has long stymied the transition process.

Madagascar faces a host of environmental pressures, however, and illegal logging and endangered wildlife exports have reportedly substantially increased under the HAT. Congress has expressed concern with threats to Madagascar’s unique ecosystem, as well as with the country’s ongoing political and development challenges. The House of Representatives passed legislation in 2009, H.Res. 839, condemning the 2009 coup and the illegal extraction of Madagascar’s natural resources.


Date of Report: June 18, 2012
Number of Pages: 22
Order Number: R40448
Price: $29.95

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