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Conflict minerals

Smartphones: Blood stains at our fingertips Add to ...

“Recent reports state that Rwanda and others are using the war in Congo to continue the exploitation of coltan. Once it is extracted, we are told, it is then sent down to Australia, where it is mixed with Australian coltan – where 20 per cent of the world’s coltan comes from – before being processed into tantalum,” U.S. Senator Sam Brownback said in a 2008 speech on the senate floor. “Unfortunately, it is impossible to say with any certainty that the tantalum supply coming out of Australia is conflict free.”

The U.S. government has moved more aggressively in recent years to combat the use of conflict minerals. The Dodd-Frank act, passed in July, contains a clause that would put intense pressure on U.S. public companies to state the source of certain minerals – including coltan’s derivatives – used in the manufacturing process. Because companies will be forced to report to the U.S. Securities and Exchange Commission, the need to ensure legally sound and accurate compliance is immense.

Mr. Dewar hopes Canada follows that lead. In late September, he introduced Bill C-571, which would create a “due diligence mechanism” to ensure Canadian companies are not purchasing conflict minerals. In Canada, the mining finance capital of the world, such rules would go a long way toward disrupting the conflict coltan trade. However, because Canada has no national securities regulator, Mr. Dewar was unable to lodge responsibility with a financial agency with teeth and has to rely instead on an ombudsman and an annual report he hopes will shame companies that continue to use conflict minerals.

But in the U.S., many manufacturers and retailers, including Wal-Mart and Target, have fought against these new rules, arguing that it is simply too difficult to accurately trace the origin of such raw materials. Some worry the Dodd-Frank act may have the unintended effect of shifting Western corporate money away from an already impoverished Congolese population.

Indeed, it appears few if any major technology firms are able to say with certainty that their devices don’t contain coltan sourced from the mines fuelling Congo’s brutal war.

Rick Goss, as the vice-president of environment and sustainability at the Information Technology Industry Council, has been helping the high-tech industry try to stay ahead of the public relations disaster that befell the “blood” diamond industry. His industry lobby group represents huge interests – RIM, Apple, Microsoft, Dell, Nokia, HP and many others – but Mr. Goss seems earnest as he describes the sector’s voluntary efforts ahead of the deadline for the Dodd-Frank provision to take effect on April 17. The group is test-piloting an audit system for the Chinese and Indonesian smelters that buy shipments from conflict zones, and it has started implementing a “bag-and-tag” process whereby the raw minerals are sealed as they are mined, aggregated through village traders and then sent off abroad in larger shipments.

Goss admits there’s no fool-proof process. In the chaos of the Congo, where even the military is being implicated in atrocities and kick-back schemes, it is simply impossible to ensure armed militias don’t get at least some of the cash, by erecting impromptu road tolls to extract illegal taxes on even legitimate shipments of “conflict free” minerals.

“There’s no paper trail when an illegal tax is applied,” Mr. Goss says. “Can you avoid every leak into the system? It’s never going to happen. No more than the IRS (Internal Revenue Service) here can make sure that no one ever cheats on their taxes.”

For years, hardware manufacturers have essentially relied on the word of their suppliers that minerals such as coltan have been conflict-free. However it appears that more and more people are deciding such assurances aren’t good enough. A campaign is under way to establish “conflict-free campuses” in universities across the U.S., and earlier this year hundreds of people peppered Intel’s Facebook page with queries about where the company gets its raw materials.

Ultimately, however, the movement to end the use of conflict coltan will largely rest on whether consumers come to acknowledge the link between sleek, state-of-the-art electronics and brutal violence in one of the most war-torn nations on Earth – and whether “blood phones” will become as current a phrase as blood diamonds.

In Kinshasa, Congo’s capital, that came into sharp focus when Mr. Dewar asked the Minister of Mines and Natural Resources about the lack of governance that has led to the violence. Couldn’t the government take a more active role in policing the mining sector, to ensure that mineral wealth didn’t flow to murderous thugs, he asked? “I remember the Minister just looking at me and saying flatly, ‘What is your role?’ ”

Iain Marlow is the Telecom Reporter and Omar El Akkad is the Technology Reporter for The Globe and Mail.

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