ITRI welcomes the recent report of the UN Group of Experts on the Democratic Republic of Congo (DRC) which recognises that ITRI and T.I.C. “continue to exhibit a high level of awareness of the UN guidelines, and have made a significant positive contribution to their members’ due diligence implementation, not least through the implementation of the Supply Chain Initiative (iTSCi)”. It is also pleasing to note that the awareness of due diligence requirements of members of the programme is considered to be good, while awareness among non-members is weaker.
There has been significant investment in the iTSCi due diligence and traceability programme from upstream supply chain companies, particularly in recent months, and we are happy to note that some of the positive impacts of project implementation which iTSCi staff have reported from the field operations in Katanga and Rwanda have also been noted by the UN Experts. These include;
• A general move from mining in conflict to non-conflict zones, and a reduction in the level of conflict financing in the 3T mineral sector
• Helping to build DRC Government capacity in the mining sector
• Safeguarding the livelihoods of miners at iTSCi tagged mining sites
• Reducing corruption among State officials in the Katangan mining sector
• Increasing mineral production and export
• Moving towards new investment and interest in the mining sector
This compares to the negative impacts of the prevailing 3T de-facto embargo in the DRC Provinces of North and South Kivu, and Maniema, and where iTSCi cannot yet operate, also reported by the UN;
• Sharply negative impact for the economies of the affected regions as a whole and a severely negative impact on provincial and national governmental revenues
• Weakened mining sector governance, with a greater proportion of trade becoming criminalized and with continued strong involvement by military and/or armed groups
• Rising unemployment and worsened poverty among the tens of thousands of people who depend on artisanal mining,
Kay Nimmo, Manager of Regulatory Affairs at ITRI noted that “It is great to see general agreement between upstream industry and the UN Experts on recommendations made” explaining that “If the SEC takes into account the need for mitigation when finalising the rules, if international buyers support activities while due diligence is implemented, and if older stocks can be released to the market, we would anticipate a much greater success of establishing legitimate supply chains for minerals from more areas of the DRC, as well as other countries affected by the Dodd Frank law.”
Expansion of the iTSCi programme from the current operations in Katanga (DRC) and Rwanda has been made difficult for a variety of reasons; stock levels in Maniema (DRC) are too high to feasibly exclude from a new traceability programme therefore preventing start-up, mitigation of risks at mine sites would need to be accepted by the market to allow time for improvements to be made particularly in the Kivu’s (DRC), and limited funding affects all areas, including other countries such as Burundi and Uganda where implementing iTSCi has also been discussed. The UN recognises a strong case for financial assistance for traceability during start-up periods in one of the key recommendations of the report.
ITRI is aware of and recognises the challenges the iTSCi project faces regarding the incentive for minerals from the DRC to be smuggled to, and through, Rwanda and already has procedures to follow up on all reported incidents of concern in conjunction with the relevant authorities. We therefore fully support the recommendations made by the UN experts for Government to take further action to close illegal border crossings between the DRC and Rwanda, as well as more fully investigate and take action against suspected smuggling networks in order to help address these challenges.
Action on current smuggling issues, as well as start-up of the project in currently excluded mining areas will be essential for miners and industry in the central African region to re-gain their access to international markets.