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Global Businesses Profit from Congo War, Groups Charge
Published on Tuesday, October 28, 2003 by the Inter Press Service
Global Businesses Profit from Congo War, Groups Charge
by Jim Lobe

WASHINGTON -- A dozen major international human rights and development groups are calling on the UN Security Council to press the United States and other western governments to launch immediate investigations into the involvement of multinational corporations based in their countries in profiteering from the war in the Democratic Republic of Congo (DRC).

The appeal--by such groups as Human Rights Watch (HRW), Friends of the Earth (FoE), Oxfam, and the International Human Rights Law Group--charges that multinational corporations (MNCs) have developed "elite networks" of key political, military, and business elites to plunder the Congo's natural resources during a five-year conflict that has caused the deaths of more than three million people--the highest civilian death toll of any war since World War II.

Given the key role played by MNCs in fueling and perpetuating the many-sided conflict--by purchasing the natural resources from the warring parties or their middlemen, according to the groups--the companies' activities should be thoroughly investigated and, where appropriate, sanctioned, the groups argue.

"The Security Council can no longer ignore clear evidence linking the exploitation of resources to the war in the Congo," they said in a joint statement.

"It must insist that member states hold the companies and individuals involved to account, including companies based in Western countries. Business must demonstrate its commitment to change the way it operates in conflict situations," the groups said.

The groups' appeal comes on the eve of the final report of a Panel of Experts that was established by the UN in 2000 to study the illegal exploitation of the DRC's abundant natural resources.

The Panel has so far published three reports, the last one in October, 2002. In that report, it found that 85 companies had violated international norms, including the Guidelines for Multinational Enterprises promulgated by the Paris-based Organization of Economic Cooperation and Development (OECD) in connection with their purchase of key natural resources from parties engaged in fighting in the DRC.

In particular, the Panel called on governments to place financial restrictions on 29 of the companies and impose travel restrictions and other sanctions against more than 50 specific individuals.

The OECD, to which all western industrialized countries belong, has specific procedures for processing complaints against western-based companies that violate its various codes of conduct by referring such cases to National Contact Points (NCPs) for investigation and possible sanctions. In the United States, the NCP is Wesley Scholz, based at the Office of Investment Affairs in the State Department.

In January, 2003 the Security Council approved a resolution strongly condemning the illegal exploitation of natural resources in the DRC and demanding that all governments act immediately to end those abuses.

The war, which has featured the intervention of the militaries of half a dozen neighboring countries, as well as a multiplicity of internal factions, has wound down over the past year, thanks mainly to UN- and South Africa-led negotiations resulting in the withdrawal of most foreign forces. Some internal parties, backed by foreign sponsors, have continued to battle for control of several mineral-rich parts of the country.

Of the 85 companies named in the October 2002 report, eight, including Cabot Corporation, Eagle Wings Resources International, Trinitech International, Kemet Electronics Corporation, OM Group (OMG); and Vishay Sprague, are U.S.-owned.

When the report was issued, the U.S. representative, Richard Williamson, pledged that his government "will look into the allegations against these companies and take appropriate measures [and] not torn a blind eye to these activities."

But, in a memo released Monday, FoE charged that the Bush administration has failed to take any meaningful steps toward investigating, let alone sanctioning, any of the companies.

On the contrary, both the United States and other OECD members have successfully pressured the Panel to remove from its final report the names of the companies registered in their jurisdictions or to declare that such cases have been resolved, according to the groups.

In the U.S., Scholz has argued that the OECD Guidelines do not apply to the U.S. corporations named in the October report because they were not directly involved in the DRC, but only purchased resources through their parties. But the groups insist this is far too narrow an interpretation of the OECD's code, which notes that parent companies or retailers have an obligation to ensure that the principles contained in the Guidelines are observed by their suppliers and sub-contractors.

While the Panel's final report does not provide specifics, according to FoE, Cabot, Kemet, and Vishay Sprague all appeared to have had "supply chain" relationships with parties in the DRC to obtain coltan (columbo tantalite), which is used in the production of sophisticated electronic equipment, particularly cellphones.

Cabot, whose CEO and chairman from 1992 until 2001 was the current deputy director of the Commerce Department, Samuel Bodman, is the world's largest refiner of coltan, according to FoE. It noted that Cabot, which sells processed tantalum to both Kernet and Vishay, said in response to the Panel's October 2002 report that it had taken measures to ensure that it is not obtaining coltan from the DRC.

The Panel also found last October that Eagle Wings had received privileged access to coltan sites and captive labor through its contacts with the Rwandan military, which controlled coltan mining areas in eastern DRC during much of the war. It specifically recommended placing a travel ban and financial restrictions on three of the company's managers. The company is a joint venture of Trinitech International Inc. and the Dutch-owned Chemie Pharmacie Holland.

The OM Group was named by the Panel as having reaped considerable profit from its joint venture, in which it holds percent stake, with a Belgian national, George Forrest and the DRC's state mining company, Gecamines, by ignoring agreements that required it to build two refineries and a converter to process germanium in the DRC. Instead, it shipped semi-processed ore from its "Big Hill Project," one of the most profitable mining operations in the DRC, to a processing plant in Finland. OMG has insisted that it has not violated any OECD guidelines.

"It is not just the Security Council but also the governments of member states that must live up to their responsibilities," the NGOs' statement said. "They must conduct open and transparent investigations using the OECD process or other judicial procedures to clarify the role that companies have played in the conflict in Congo."

Other groups that signed the appeal include Britain's Christian Aid, Fatal Transactions, Global Witness, the International Human Rights Law Group, the International Peace Information Service, the International Rescue Committee, OECD Watch; Pax Christi Netherlands; Save the Children UK; and a number of Congolese human rights groups.

© 2003 IPS


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