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Gold now top conflict mineral in Congo: Report

Thursday - 10/25/2012, 7:32am  ET

By MELANIE GOUBY
Associated Press

GOMA, Congo (AP) - Gold is now the primary source of income for armed groups in eastern Congo, and is ending up in jewelry stores across the world, according to a report published Thursday by the Enough Project.

"The essential revenue for armed groups comes from gold today. Of course there are other sources like logging, but gold has become the primary source for groups like the FDLR," said Fidel Bafilemba, Enough's researcher in eastern Congo.

Because of the United States' Dodd-Frank law requiring companies to track the origin of the minerals they use, armed groups have been unable to profit from the exploitation of tin, tungsten and tantalum, and have turned instead to gold, which is easier to smuggle across borders.

"Gold is very portable, you can put it in your pocket and it is easily smuggled across the border. You don't need a large quantity to make a lot of money," said an anti-fraud agent of the border custom in Goma, who requested anonymity because of the sensitivity of the subject.

Roughly $30,000 worth of gold can fit in a pocket and around $700,000 in a briefcase, estimates The Enough Project, the rights group that specializes in conflict minerals in Congo and Sudan.

While only 23 kilograms of gold were officially exported from eastern Congo in the first half of 2012, 2 tons to 4 tons of gold went out through illegal routes, according to the report.

As a result, the illegal gold trade represents lost revenues of hundreds of millions of dollars for the Congolese state every year, preventing the local population from benefiting from the country's natural resources.

Instead armed groups are profiting from the illegal trade, through taxation and coercion.

"If you drive from Walikale (a major minerals center) to Goma, you have to pass three different checkpoints. You have to pay the (Rwandan Hutu Democratic Forces), you have to pay the (former National Congress for the Defense of the People), and you have to pay the army. You have to pay all, or they will kill you," says Willy, a minerals transporter quoted by Enough.

On top of supplying the funds for armed groups to buy weapons and ammunition, the illegal gold trade is a source of violence in itself, as armed groups fight each other for control of mines.

The M23, a rebel group that formed in April and May following the defection of high ranking officers from the Congolese army, is trying to gain control of the Rubaya gold mine in Masisi, according to Enough.

One of the M23 leaders, General Bosco Ntaganda used to run an illegal mineral trade network when he was in the Congolese army, making millions of dollars each year from mines including Rubaya, according to the report.

Working conditions in the mines are dreadful as a result of the violence surrounding the trade and the complete absence of regulation.

The miners, 40 percent of whom are children according to the advocacy group, work in extreme conditions, with crude equipment such as pick-axes and shovels.

In Nyabibwe, a cassiterirte mine where conditions are similar to those in gold mines, miners go down tunnels without any safety net.

"With time, we actually forget about the dangers, even though they are real," says Bisima, a 33-year-old miner working at the Nyabibwe pit. "Mine collapse remains the greatest danger."

In August, 60 people died in a gold mine which collapsed in Pangoyi, Ituri Province.

The gold from eastern Congo is smuggled across the border to Uganda, Burundi or Tanzania where it is absorbed in the local trade and then sent to major world markets, states the report.

Uganda produced only $167 million worth of gold in the past three years, but exported an estimated $212 million, according to statistics cited by Enough.

"They (the government) like the chaos. It's what allows the officers to get a cut from the trade," said a former Ugandan mining official quoted by Enough.

Uganda was accused in a recent United Nations report of supporting the M23 rebellion in eastern DRC. The Ugandan government strongly denies the allegations.


(Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)