A recent article in Resources Policy, an international journal covering minerals policy and economics, found that individuals, academics, and companies that continue to argue that the U.S. Dodd-Frank legislation’s Section 1502 on conflict minerals has resulted in unintended negative consequences in the Democratic Republic of Congo are largely relying on outdated data.
In the article, authors Dutch Special Envoy for Natural Resources Dirk-Jan Koch and Radboud University’s Sara Kinsbergen analyzed one particularly pervasive narrative: the assertion that the U.S. conflict minerals law led to or at least contributed to a de facto boycott of mineral exports from Congo, and that this boycott continues to cause detrimental effects in Congolese mining communities.
The authors first clarify the timeline of events, noting that “the DRC government adopted an export ban on minerals from North & South Kivu and Maniema, before the Securities and Exchange Commission (SEC) approved the ﬁnal rules.” In other words, the so-called boycott was a result of a domestic ban imposed by the Congolese government and occurred before Section 1502 had even been fully established in the United States. This, however, does not entirely negate the fact that confusion surrounding the conflict minerals law’s implementation led some companies to avoid sourcing from Congo and the region. And the combination of voluntary company withdrawal and the Congolese government’s official ban did result in serious negative impacts on some mining communities in Congo.
However, Koch and Kinsbergen argue that, six years after the U.S. law was implemented, it is no longer relevant or prudent to allege that the drop in investment that occurred initially still exists today, nor that the negative impact it had is still felt as acutely in Congo. Yet critics of the law continue to rely on this outdated data to make their case for the contrary. For example, Koch and Kinsbergen write:
Two inﬂuential studies…argue that the embargo on the livelihoods of the Congolese is devastating (Parker et al., 2017; Parker and Vadheim, 2017). Interestingly, the data for both of these studies stem from the immediate post-Dodd-Frank era ending in 2012, even though their articles were published in 2017. These articles were often used by those substantiating the claims that the boycott was still ongoing and the unintended eﬀects still prevailing even though the data used in the articles related to 2010 and 2011 and not to 2015 and 2016.
Koch and Kinsbergen observe that studies relying on outdated data continue to be referenced and replicated, and that “companies who would gain from deregulation stick to an outdated narrative.”
The accumulating positive impacts of conflict minerals supply chain reforms spurred by Dodd-Frank 1502 are increasingly well documented. According to a study by the International Peace Information Service, 79 percent of the tin, tungsten, and tantalum (3T) miners they interviewed in 2016 were not working under the threat of armed groups. Also in 2016, Congo’s North Kivu province – an epicenter of mining – logged record-breaking exports for both tin and tantalum; a fact that directly contradicts the assertion that the de facto boycott continues even today. Furthermore, 495 mines in Congo have now been assessed and validated by multi-stakeholder teams as conflict-free, as of December 2017.
In contrast to academic and media reports that continue to propagate obsolete narratives, Koch and Kinsbergen point out that many of the submissions in response to the SEC’s 2017 call for public comment on the conflict minerals regulation recognized the changing circumstances in Congo. In a particularly poignant example, Eric Kajemba, a civil society leader from Congo’s South Kivu province, joined a coalition that wrote to the SEC last year imploring that “suspending Section 1502 would undoubtedly lead to conflict minerals infiltrating the supply chain with devastating effects.” This sentiment was a marked evolution from the opinions expressed in a 2014 open letter Kayembe also signed which “stipulated that the Dodd-Frank Act had unintended and damaging consequences.”
“In sum,” Koch and Kinsbergen conclude, “whereas the alternative narrative [of positive developments in Congo] appears to have evolved together with the changes on the ground, the dominant narrative [claiming the boycott is still negatively impacting Congolese mining communities] does not take into account that the eﬀects of the de facto embargo are petering down.”
In 2018, the benefits of a conflict-free minerals trade demonstrably outweigh the negative impacts incurred during the initial implementation of the law. As such, the underlying motives and interests of critics who continue to use data from half a decade ago to make their case and assertions should be closely evaluated.