Congolese warlords and unethical U.S. corporations will be the big winners if U.S. President Donald Trump goes ahead with a reported plan to suspend the restrictions on "conflict minerals" from Central African war zones, human-rights groups say.
The latest Trump plan would jeopardize many years of effort to identify minerals from conflict zones so that consumers aren't inadvertently financing war and rape when they buy cellphones, laptops, jewellery and other products, the groups say.
Canadian researchers have been among the leaders in developing a certification system to ensure that minerals in consumer products are not supplied from mines controlled by armed militias in war-torn countries such as the Democratic Republic of the Congo.
Those efforts could be severely weakened if Mr. Trump suspends the "conflict minerals" provisions of the Dodd-Frank regulations, the Canadian researchers say.
Mr. Trump is considering an already drafted executive order to suspend the minerals rule for two years, which would loosen the rules on the trade of tin, tantalum, tungsten and gold from Congo, according to media reports in the United States.
Business groups, who have been lobbying against the rules and challenging them in court, will welcome the expected order. They say the regulations would cost billions of dollars and would lead to job losses.
The Dodd-Frank law was passed in 2010, and went into force in 2014 after a court challenge. It requires U.S.-listed companies to investigate their supply chains to see whether their products contain metals that could have been sold by armed groups involved in violence in Congo and neighbouring countries.
Diamonds from conflict zones, known as "blood diamonds," are regulated by a separate international system, the Kimberley Process, which was established in 2003 after a report by a United Nations commission headed by Canadian diplomat Robert Fowler. The Kimberley Process was a key influence on the drafters of the Dodd-Frank regulation on conflict minerals.
Some analysts say the regulation has led to increased unemployment in Congo, since a large number of small mines have been shut down as a result of declining demand from corporate buyers after the Dodd-Frank rule was introduced.
Even if the regulation is suspended, some companies are unlikely to change their behaviour, since they have been marketing their products as free of conflict minerals. And with Europe passing similar rules, the emphasis on "clean" supply chains is becoming the new standard for the industry, analysis say.
But human rights advocates are still deeply worried by the possible U.S. suspension. "This is a shameless proposal which threatens to unravel years of progress in ending the trade in conflict minerals," Amnesty International said in a statement.
"The conflict minerals law is a vital way of breaking the chain between horrific human-rights abuses in Central Africa and consumer products like smartphones," Amnesty said.
"By requiring companies to be transparent about how they source minerals, it throws light on shameful and secretive business practices that allow companies to benefit from conflict and abuse. Suspending it would be a boon to irresponsible companies and the perpetrators of violence in countries like Congo."
Another group, Global Witness, said the suspension of the conflict minerals regulation would be "a gift to predatory armed groups seeking to profit from Congo's minerals, as well as a gift to companies wanting to do business with the criminals and the corrupt."
A third group, Human Rights Watch, said the suspension would "enrich abusive thugs." Suspending the regulation could lead to the complete repeal of the Dodd-Frank regulations, it said.
Armed groups have often committed war crimes by using profits from gold to buy weapons and finance their activities, it said. It cited the case of a gold-mining town in the Ituri region of Congo. Militias fought to control the town for 18 months in 2002 and 2003. As the town changed hands five times, warlords killed an estimated 2,000 civilians and committed many acts of rape and torture, Human Rights Watch said.
Partnership Africa Canada (PAC), an Ottawa-based group, has been working with countries in Central Africa to support a certification system for minerals, ensuring they have been tracked, verified and certified as meeting global standards. The work has gained financial support from the Canadian government. But now this work could be jeopardized by the possible Trump order, the group says.
A suspension would "significantly threaten efforts to promote conflict-free minerals and severely undermine years of work to ensure the revenue of these minerals brings lasting peace and sustainable development in the communities where they are mined," said Joanne Lebert, executive director of Partnership Africa Canada.
"If the United States pulls out… it will send the signal to warlords and smugglers that the world is indifferent to corrupt, exploitative and possibly violent practices."