Working Effectively in Fragile and Conflict-Affected States: DRC and Rwanda - International Development Committee Contents

Written evidence from Global Witness

Please find below our briefing on concerns over the Democratic Republic of Congo's natural resources sector. Our key concerns are highlighted in bold. Global Witness believes the International Development Select Committee could help push for improvement in the management of the country's natural resources by pushing these points with government officials and others (including donors and private sector representatives) with whom they speak. This would help ensure that DRC's natural resources are used for the benefit of the population as a whole.


Following a series of highly controversial moves in the mining and oil sectors, including the confiscation of key assets held by international companies, the World Bank suspended new aid disbursements to the DRC in the autumn of 2010 (excluding humanitarian aid). For the suspension to be lifted, the DRC agreed to fulfil a number of conditions, notably saying it would publish all agreements in the mining, oil and forestry sectors. The document in which this is all laid out is called the "economic governance matrix".

In May the DRC passed a decree in response to this pressure, stating that all natural resource contracts would be published within 60 days of their coming into effect. This is a welcome move that could help prevent corruption. However, while several contracts have already been published online, these do not include opaque oil deals signed last year or revisions to a huge resources-for-infrastructure deal with China (see below). It is crucial that these and all other active contracts are published.

Global Witness has been pushing particularly for the official publication of some of the most recent revisions to a $6 billion deal with China, under which the DRC is to provide millions of tonnes of copper and cobalt in return for an array of infrastructure projects. The deal could transform the country by providing new roads, hospitals and other infrastructure. But anti-corruption safeguards—particularly transparency measures—should be taken to ensure it really delivers. As a first step the latest version of the contract (from late 2009) should be made public to allow proper scrutiny. In addition, the DRC and China should systematically declare what infrastructure is being provided under the deal and how the minerals being exported from the DRC are to be valued: in other words, they should say what the DRC is getting and what it is giving. The government and companies concerned should also properly account for all financial and in-kind payments made in relation to the agreement (according to the principles of EITI). These payments include signature bonuses and taxes. In the absence of such basic information, it is much easier for corrupt individuals to profit from the deal.

Global Witness is also concerned about the DRC's confiscation of mines belonging to First Quantum and oil licences belonging to Tullow, and their subsequent reallocation to companies based in offshore tax havens in 2010. It is unclear, for example, why the companies Caprikat and Foxwhelp—based in the British Virgin Islands—were given control of oil Blocks 1 and 2 of the Albertine Graben, in the northeastern area of Ituri. As well as having potential tax implications for the DRC, the fact that the companies are registered in the BVI means it is virtually impossible to trace their chain of ownership through company documents. The blocks could prove of major importance to the country's economy. It is crucial that such contracts are officially published and that the true or "beneficial" owners of the companies are made known.

Key documents:

—  —  Economic Governance Matrix:

—  —  Global Witness report, China and Congo: Friends in Need:

—  —  Global Witness press release on transparency in the DRC:


For 15 years now, armed groups have been preying on the mineral trade in eastern Congo. Within the last year serious moves have been taken at the international level to stem the trade in conflict minerals. In July 2010, the US Congress passed the Dodd-Frank Wall Street Reform and Consumer Protection Act, requiring companies buying minerals from the Great Lakes Region to conduct due diligence on their supply chains to ensure they are not buying conflict minerals. The UN Security Council has also endorsed rigorous due diligence standards (ie measures companies must take to make sure they are not buying conflict minerals), as has the OECD.

Global Witness is backing these due diligence standards, which focus not just on rebel groups and militias, but also on official army units that have been profiting from the minerals trade. The International Development Select Committee will probably have been informed about traceability schemes in DRC and Rwanda, aimed at tracking minerals from the mine to the point of export. These schemes are a necessary part of due diligence, but they should be accompanied by on-the-ground checks of the supply chain, as a bagging-and-tagging system alone cannot guarantee a clean minerals trade in eastern DRC. The kind of extortion commonly carried out by armed groups along transportation routes, for example, need not interfere with tags. Diggers or traders transporting sacks of minerals sealed and tagged can be illegally taxed by men with guns just as easily as those carrying unmarked or untagged bags. Carrying out comprehensive due diligence—which includes but is not limited to establishing mineral traceability—is currently the only credible way for companies to assess whether armed groups have interfered with and benefited from the trade at any point along the supply chain. The field assessment component of due diligence is particularly critical if companies are to identify extortion or situations where members of the military are using civilian proxies to represent their interests in the mineral trade.

In an April field visit to eastern Congo, Global Witness was encouraged to learn that the biggest tin ore mine in eastern Congo, Bisie (which accounts for some 70% of North Kivu's tin ore production) had been mostly or entirely demilitarised. This is a major development but measures should now be taken to ensure that armed groups do not return to the mine—and that, if they do, trade with the mine stops. For this purpose, the UN force MONUSCO should ensure that peacekeepers are present at or near the mine and along mineral transportation routes to deter any renewed attempt by armed groups to control or otherwise profit illicitly from the minerals trade.

On the international level, Global Witness is pushing for other jurisdictions to follow the US government's lead, and pass legislation obliging companies to carry out due diligence on their supply chains.

Key Global Witness documents:

The Hill Belongs to Them

( and our last press statement



The DRC currently chairs the Kimberley Process - the scheme set up to prevent the trade in conflict diamonds. This should be an opportunity for the DRC to demonstrate its commitment to promoting good natural resource governance. However, so far their performance as Kimberley Process chair has not been encouraging. In April the Chair, Matthieu Yamba, stepped far beyond his remit to attempt to unilaterally lift restrictions on diamond exports from Zimbabwe's troubled Marange region, to the dismay of numerous Kimberley Process members. The Congolese government will be hosting the Kimberley Process intersessional meeting starting June 20th in Kinshasa. It is vital that the DRC does not allow regional political loyalties to take precedence over the urgent need to introduce reforms and restore some credibility to this once pioneering scheme.


Given the UK Government's development strategy focus on the private sector, Global Witness is concerned that an area of significant private sector activity—namely logging in the DRC—risks massive environmental, social and economic damage. Global Witness urges MPs to look closely at this issue during their forthcoming visit.

The DRC sits in the Congo Basin, the second-largest rainforest in the world and a vital asset that needs to be preserved in order to fight global climate change. Logging operations are a grave threat to the survival of the remaining intact rainforest. Most of the timber from the DRC is shipped to European markets and because of a lack of controls, there is a high risk that a significant amount of this timber is illegal.

There appears to be a rush to expand industrial-scale logging into DRC's intact forests without: (1) micro-zonage—an inventory of how forests are being used by local populations; (2) a national forest plan and a national forest (tree) inventory; and(3) a functioning forest control system to ensure regulations are adhered to and that there is no illegal logging.

In 2002 the DRC government passed a new Forest Law which made it obligatory for companies to negotiate and sign Social Obligation Contracts (cahiers de charges) with local communities affected by their logging operations. These Social Obligations involve the logging company paying into a "Community Development Fund", in proportion to the amount of timber extracted from ancestral forests. These funds are to be used to refurbish and build schools, health centres and roads.

In March and April 2011, Global Witness visited 21 communities in the Provinces of Equateur and Bandundu. Among numerous concerns over the negative impacts of logging, villagers claimed that "development projects" provided minimal benefits—for example, schools with no furniture; health centres with no medical equipment and hardly any beds; buildings with non-durable material that fall apart within a few years.

We confirmed this through visits to 54 projects. We also saw evidence of new social agreements being rushed through without the "beneficiary communities" being properly informed or prepared for negotiations.

Global Witness is concerned about the tension we observed between communities and logging companies as a result of the failure to implement development projects in compliance with contracts with communities. Main complaints include:

—  1.  no or only minimal employment of local people by logging companies, which are removing timber from ancestral forests;

—  2.  logging related destruction of forest biodiversity, from which villagers draw their food and traditional medicines;

—  3.  demands to respect traditional and customary rights and benefit-sharing agreements is often met by force (arrests, beatings, destruction of homes, with dozens of reported rapes by security forces); and

—  4.  authorities in Equateur and Bandundu Provinces taking the side of logging companies in conflict; eg reports of deploying police and military to quell resistance to logging operations.

There are allegations that in May this year two of the biggest logging companies operating in Congo, which are subsidiaries of multinationals, provided logistical support to military and security forces to arrest and imprison number of representatives of villages who requested that their rights and social obligation agreements reached with the companies were respected.

There are reports that in May this year two of the biggest logging companies operating in the DRC—Siforco and Sodefor, both of which are subsidiaries of multinationals—provided logistical support to military and security forces to arrest and imprison a total of 22 representatives of villages who requested that their rights and social obligation agreements reached with the companies were respected. In the Siforco case, on 2 May 2011, naval forces reportedly beat numerous people and raped three girls and three women. One of those beaten, Frédéric Moloma Tuka, a man in his late fifties, died that same night, allegedly from his injuries. Global Witness has not investigated these reports directly and has not substantiated them but we are sufficiently concerned that we are calling for an independent investigation.

Global Witness is concerned that huge oil deposits recently discovered in the "Cuvette Centrale" (a region covered by intact natural forest) could lead to an extensive allocation of drilling rights. Brazilian oil service firm HRT Petroleum, hired by the government to survey the Cuvette Centrale basin, has reportedly estimated that it could hold potential reserves of 7.3 billion-13 billion bl of oil and 4 trillion ft (113bn m) of gas. Whilst the Minister of the Environment and Forests has suspended drilling in Virunga National Park (not part of the Cuvette Centrale), we fear that non-protected areas could be vulnerable to drilling. Involving thousands of miles of roads and pipelines, this could have a devastating impact on the forests and its inhabitants, and given experience in Nigeria and Ecuador is likely to increase the risk of conflict between companies and local communities.

In order to get funding from international bodies working to prevent climate change, the DRC has developed plans to reduce emissions from deforestation. These plans, including the Readiness Preparation Proposal, bizarrely, actually proposes to increase the amount of forest to be opened for logging by about 10 million hectares.

Global Witness is deeply concerned that, according to forest administration officials interviewed by Global Witness in Equateur and Bandundu Provinces, the government has not yet put into place a control system to monitor compliance with the law of operations in the country's forests. Timber is leaving sites without any inspection of species felled or volumes produced. Worse, according to government sources the upgrading of roads in the Provinces of Orientale and North Kivu has accelerated the transport of illegally cut timber to Rwanda and Uganda. The lack of any road control facilitates the illegal trade of timber.

8 June 2011

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Prepared 5 January 2012