Cobalt mining in the Democratic Republic of the Congo: the need for reform and regulation?

The Democratic Republic of the Congo (DRC) has the world’s largest source of cobalt. Over the past few decades the rare mineral which was formally mined as a by-product of copper has become a highly demanded mineral. It has been reported that this demand tripled in the first decade since the turn of the millennium. The demand for cobalt has increased in correlation to the global demand for portable electronics; such as laptops, phones and electric cars, due to its use as a vital component in lithium ion rechargeable batteries. According to an Amnesty International Report (2016) into the human rights abuses in the DRC cobalt industry, “demand for cobalt is growing at over 5 percent a year, and is expected to continue doing so”. Looking to the future, this new industry is set to increase exponentially with the expansion of the market and demand for electric cars. This will further drive the growth in demand for cobalt as electric cars and vehicles use a significantly larger amount of cobalt than is used in laptops and smartphones. There appears therefore, to be a clear and pressing need for responsible regulation of this newly developing industry. This is needed to both manage and control the market growth, to prevent exploitation but also to ensure that the DRC can benefit from this growth nationwide. Some may indeed voice fears and pose the argument that greater regulation of cobalt mining threatens to stifle the development of this emerging industry, and that other industries such as copper mining were not heavily regulated from the off-set.

The history of cobalt mining in DRC has its roots firmly in the colonial period as the DRC’s biggest mining company Gécamines. The state-controlled mining company formed in 1966 from Cecil Rhodes’ and Leopold II of Belgium’s merged company, Union Minière du Haut Katanga (UMHK) and is the biggest mining company in DRC and amongst the largest in Africa. The legacy and influence of both Rhodes and Leopold II therefore continues to have an ongoing effect for the mining industry in DRC today as those same companies continue to retain control of Congo’s wealth of minerals. It is worth noting that Gécamines did enjoyed a period of prosperity as a nationalised company during the 1970s and 80s, reaching its peak point of production in 1986. During this time, the state-controlled company ran schools and hospitals for the benefit of its employees in addition to contributing heavily to the state treasury. However, during the 1990s there was a major decline in the production of copper and cobalt and in the financial stability of the company leading Gécamines collapsed along with the collapse of the Mobutu Sese Seko regime. The nationalisation of Gécamines led to a decline in profits and production due to the mismanagement of the government under Mobutu. Because of the failure of the nationalisation of one of the largest mining company in Africa, there now understandably remains an anxiety surrounding government interference in the industry. However, the benefits to employees to the infrastructure and support which the company was able to provide at its peak during the 70s and 80s, alludes to the reforms which are needed in the present day.

In reaction to the collapse, Artisanal and small-scale mining (ASM) grew significantly during 1990s and continued to do so after Laurent Kabila endorsed and encourage artisanal mining during the Second Congo War (1998-2003). Since the publishing of a report on human rights abuses in the DRC and the global cobalt trade by Amnesty International at the beginning of this year, much attention has been drawn upon the conditions of the cobalt industry in the DRC by the media. The Washington Post’s investigative article into the conditions of artisanal miners, similarly exposed many problems stemming from unregulated ASM, including a plethora of health and safety concerns, mining related illnesses, child labour and an exploitative environment. Amnesty International claim there have been 80 fatalities in the past year, however it is unknown how many deaths go unreported in such conditions. Equally, UNICEF have reported that at least 40,000 children work in artisanal mines in southern DRC – many mining cobalt. Thus, it cannot be denied from these contemporary articles and reports, that higher quality regulation is in dire need, in addition to socio-economic development in these areas. These unregulated mines clearly grew in a vacuum created after the breakdown in industrial mining during several decades of conflict.

From 2001 the World Bank supervised the governments mining policies. DRC’s 2002 mining code therefore can be seen to have been adopted in part due to pressure from the World Bank. The mining code which attempted to encourage foreign investment limited ASMs to specific limited zones however there are reportedly few of these zones in the mineral-rich south therefore most artisanal miners are therefore forced to working in unregulated areas or through trespassing. Some have claimed that the current mining code (2002) is barely enforced as it stands currently and that it would be highly unlikely to enforce stricter regulations throughout the DRC and is therefore unlikely to impact the sector even if implemented.

In recent months, there has been renewed calls for a review of the DRC’s 2002 mining code. However, a previous investigation of looking into changing the code was halted in 2012 amidst fears that changes would drive away investors putting the industry at risk. Due to the historical mismanagement of the mining as an industry under the control of previous governments, it is clear to see why fears have emerged over any processes or reforms which would pose a potential risk to foreign investment, such as a reform to the mining code. Those opposed to increased regulation may argue for the benefits of the free market and privatisation, citing the failure of the nationalisation of Gécamines as a damning indictment of the risks of state-run companies. Whilst this is understandable, it is misleading to suggest there have been no issues surrounding privatisation in DRC. Criticism of the World Bank’s role in postcolonial African states is nothing new, however it has been suggested that the free market system introduced by privatisation, (as encouraged by the World Bank) overlooked the inability of the structures within the DRC to properly manage and regulate the free market.

It is difficult to estimate the extent to which artisanal miners supply the cobalt chain due to the small scale and unregulated nature of artisanal mining, however it clearly plays a significant part. There are claims that between 60 to 90% of cobalt from the Katanga Province between 2000-2010 came from artisanal mining. If this figure is accurate there is clearly a need for the significant formalisation of artisanal mining. CDM (Congo DongFang Mining), one of the leading companies purchasing cobalt

from artisanal mines in DRC can be traced as contributing to the original source of cobalt used by large businesses around the world. There has been increasing scrutiny of the supply chain between DRC and major global companies such as Apple, Song, Samsung. In light of the increased focus upon conditions of cobalt artisanal miners and the prevalent use of child labour, there have been calls for these companies to take on responsibility to regulate their resources, citing diligence to have transparency of their supply chains. Cobalt was not included in the 2010 US Dodd-Frank Act which addressed ‘conflict materials’ in DRC however there has been increasing pressure for it to be treated in a similar fashion and for businesses to include cobalt in their regulation ‘conflict materials’.

DRC has long been said to have a ‘resource curse’ (playing into cliched stereotypes of the African continent) as it has a great source of nature resources which is not felt in DRC despite its potential for vast amounts of wealth. The control of wealth by semi-autonomous private companies has historically mean that whilst resources such as cobalt have been hugely profitable for elites within the DRC and foreign investors, the state can’t capitalise on its own natural resources. Similarly, an increase in recent years of ASM unregulated cobalt mines mean that local areas cannot benefit and develop from the profits created through proper taxation and therefore reform and regulation are crucial.


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Featured image | Cobaltoan calcite (Shaba, Zaire) : James St. John | flickr

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