Bloomberg News

Congolese Province Promotes ‘Conflict-Free’ Minerals in U.S.

June 20, 2011

June 20 (Bloomberg) -- The Democratic Republic of Congo’s Katanga province has begun promoting itself as a source of conflict-free minerals as electronics-industry groups meet to discuss new regulations on the trade.

As companies such as California-based Apple Inc. and Illinois-based Motorola Solutions Inc. try to keep so-called “conflict-minerals” out of their products, southeastern Katanga province may be an alternative supplier of the materials, Moise Katumbi, the province’s governor, said in an interview.

Trafficking in natural resources including gold, tin ore, and coltan, all key elements in electronics, has fueled more than a decade of war in eastern Congo, according to the United Nations.

“In Katanga there is no war and there are no military in our mines,” Katumbi said in Lubumbashi, the provincial capital, on June 15. “People who are implicated in the war, people who are implicated in the reports by NGOs or the UN, can’t come and be outlaws in my province.”

The trade in tin ore, coltan, gold and wolfram from Central Africa ground to a halt in April when new auditing guidelines for mineral processors by the U.S. Electronic Industry Citizenship Coalition and the Global e-Sustainability Initiative took effect. The groups begin two days of meetings in Washington, D.C., today to discuss regulations that are meant to help break the link between armed groups and the mineral trade in eastern Congo, and affect exports from Congo and nine neighboring countries.

Mineral Tracing

Katanga has implemented taxes and regulations blocking trade in tin ore and coltan to or from neighboring provinces where conflict persists. The province also began a mineral- tracing system with the help of tin industry group ITRI Ltd. and the development organization Pact in April.

Katanga’s coltan and tin ore exports dropped 93 percent from March to April, and fell to zero in May as traders stopped buying from the region, according to provincial Mines Ministry statistics.

Electronic-industry groups are considering accepting minerals from Katanga and elsewhere in Central Africa if they meet guidance for the conflict-mineral trade developed by the Organization for Economic Cooperation and Development, Rick Goss, vice president for environment and sustainability at the Information Technology Industry Council, said by e-mail today.

“We share a strong common interest with governments and the NGO community to help develop and source through valid supply channels in the region,” he said. Rwanda is also participating in the industry meetings and is being considered as a conflict- free source of minerals, Goss said.

Tin Exports

Congo is the fifth-largest supplier of tin in the world, producing at least 15,000 metric tons a year. Katanga was responsible for only about 3 percent of Congolese tin-ore exports in 2009, the last time full-year statistics are available from all cassiterite-producing provinces. Exports increased nine-fold in 2010 to 3,610 tons, when neighboring South Kivu province had its exports blocked by government decree. Katanga, which is also rich in copper and cobalt, exported 159 tons of coltan in 2010, up from zero in 2009.

A subsidiary of India’s Somika Minerals Pvt Ltd. currently controls most of the trade in tin ore and coltan from Katanga.

Tin for three-month delivery prices has risen 38 percent over the past year and traded at a record $33,600 a ton on April 11. The metal fell 1.2 percent to $24,700 in London today.

--Editors: Paul Richardson, Philip Sanders.

To contact the reporter on this story: Michael J. Kavanagh in Kinshasa on Mkavanagh9@bloomberg.net.

To contact the editor responsible for this story: Antony Sguazzin in Johannesburg at asguazzin@bloomberg.net.


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