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MULTINATIONAL MINING COMPANIES ARE STEALING CONGO'S
PATRIMONY
On the 2 August 1998, Rwanda, Uganda, and Burundi
launched a war of aggression against the Democratic Republic of Congo with
the blessing of Washington, London and South Africa, on the pretext that
Laurent DésiréKabila whom they supported to chase long-term kleptocratic
dictator Mobutu Sese Seko from power, was not doing enough to curb rebel
activities from the Congolese territory into Rwanda, Uganda and Burundi
and worse he was not allowing them a free reign in the Congo to track down
and massacre all Hutus present in the Congo. A UN Panel of Experts on the
Illegal Exploitation of Natural Resources and Other Forms of Wealth of
Congo, has proved that the reasons advanced by the aggressors as an alibi.
This invasion provides a smoke screen for and is closely linked to another
invasion of Congo' mining properties at the heart of which are American
and Canadian mining companies and the Openheimer family-run South
Africa-based Anglo American Corporation. These mining companies represent
forward beachheads for the London-centred Club of the Isles, an
Anglo-American global raw materials cartel.
The opening shot of
what is commonly known in business circle as the 'Second Great Scramble'
for Congo's strategic mineral grab, took place in 1996 when under Mobutu
regime, Banro Corp. of Toronto bought 36% of Société Minière et
Industrièlle du Kivu (Sominki). Sominki was formed in 1976 as an
amalgamation of nine companies that had been operating in Kivu, the second
richest in minerals Congolese province after Katanga, since 1900s. It
operates 47 mining concessions, encompassing an area of 10,271 square
kilometres. Banro raised some of its money for the purchase by floating
shares in Singapore. Banro was previously a small financial institution,
with little apparent aptitude for mining. It was reconfigured as a company
for the special purpose of this purchase, or acting as a front for
someone.
Another large chunk of Sominki was bought by the then
Belgian-based mining company Mines d'Or du Zaire (MDDZ). Now 60% of MDDZ's
shares were owned by Cluff Mining CO. of London whose 65% of shares are
controlled by Anglo-American Corp., the world's largest mining company and
a key component of the Club of the Isles. On September 1996, Banro and
MDDZ announced their merger, with Banro selling its shares to MDDZ. The
new Banro-MDDZ company consolidated a 72% stake in Sominki, while Mobutu's
government held 28%. The Banro-MDDZ entity subsequently announced that it
planned to acquire that 28% from the government, the last nail in the
coffin for Sominki.
In 1997, Kabila took advantage of the
geopolitical change in the region, whereby Rwanda vowed to root out the
Interahamwe (= those who kill together), perpetrators of the 1994
genocide, harboured by Mobutu in the east of the former Zaire, to ensure
its stability. Uganda and Angola were equally concerned, given the fact
that Mobutu also harboured Angolan UNITA rebels who had important bases in
the south western part of the former Zaire; Ugandan Lord's Liberation Army
rebel movement was also operating from the north eastern part of the
former Zaire and posed a constant threat to President Museveni's
regime.
Congo's neighbours decided to do away with Mobutu and
readied their military and logistic support to Mobutu's arch-foe: Laurent
Désiré Kabila.
But in reality Banro was anxious to get its mining
operations started as quickly as possible. However, the Sominki mining
zone that Banro acquired started in the town of Bukavu, the centre for the
major camp of Rwandan refugees who had fled to the former Zaire, with
nearly a million people. To get mining started, the entire zone would
require clearing. Suddenly in mid-October 1996, firing started on the
Bukavu refugee camp, supposedly against 'Hutu rebels' who were hiding
there. The military attack on the camp forced hundreds of thousands of
refugees to flee Kivu province, back to Rwanda.
But who did the
firing? While a clear answer was not forthcoming, it may have involved
portions of the newly acquired Sominki apparatus itself. For, in acquiring
Sominki, Banro did not just acquire a company; it acquired the effcetive
governmental structure of the entire Kivu province.
A Banro
Corporate press release said at the time: 'Sominki owns an extensive
infrastructure which includes repair shops, machine shops, electrical
shops and large fleet of Land Rover vehicles. In addition, it operates six
hydroelectric sites, a number of airstrips, and 1,000 kilometres of Roads.
Sominki is virtually self-sufficient.' This self-sufficiency covered
security matters. As a mining company, Sominki had its own explosive
supplies and access to weapons, that is it had the capability to carry out
such an attack, or was in a commanding position to influence Rwandans and
Ugandans to fire on the refugee camps.
In 1996 Barrick Gold joined
hand with Hollinger Corp, and purchased the 'Mines d'Or de Kilomoto' a
huge gold concession in Congo's northeast Oriental province, which covers
83,000 square kilometres. Already in May 1995, the Canada-based Barrick
Gold Corp. created an international advisory board around the personal
leadership of former American President George Bush, then designated as
'honorary senior adviser'.
Also during 1996, the tiny
Vancouver-based raw material company, Consolidated Eurocan, headed by
international wheeler-dealer Adolf Lundin, began work on exploiting the
Tenke-Fungurume copper-cobalt mines in Congo's southern Katanga province,
near the border with Zambia, which has the richest cobalt reserves in the
world. Cobalt is a strategic metal, crucial in forming alloys with steel,
and other metals, giving them great strength and heat resistance. Some 40%
of cobalt's use is in aircraft gas turbine engines, and 10% is in magnetic
alloys. Consolidated Eurocan in joint-venture with Anglo-American, set to
purchase the mining property in phases, for a quarter of a billion
American dollars, which is joke for a property that could yield many tens
of billions of dollars in revenues.
At the same time, American
Mineral Fields (AMF), now trading under the initials AMZ (American Mineral
Zincor, since it is in joint-venture with Zincor of South Africa), had
acquired from Gecamines, Congo's state mining company, the Kipushi
copper-zinc mine, one of the world's premier copper-zinc mines, located in
Katanga province (copper and zinc are often mined together). The Belgians
developped Kipushi and began mining in 1925. At its peak in 1988, the
Kipushi mine produced 143,000 tons of zinc, and 43,000 tons of copper. Its
total known and probable reserves stand at 22.6 million tons, grading 2.1%
copper and 13.8% zinc. AMZ is the brainchild of its owner, Jean-Raymond
Boulle, a former execuitve for De Beers's Diamonds. In turn, AMZ signed an
agreement with Anglo-American, which would allow Anglo to invest up to
$100 million in any AMZ venture in Katanga province, representing up to a
50% equity stake in the venture, including the Kipushi mine.
After
seven months of a swift war, Kabila's 47,000 men helped by Rwandans and
Ugandans made it to Kinshasa on 17 May 1997 and chased Mobutu from power.
Right after the fall of Kisamgani. Congo's third largest city which
symbolises Lumumba's struggle for independence, Kabila auto-proclaimed
himself the new President of the Democratic Republic of Congo, thus
short-circuiting the ambitions of those who helped him win power. Kigali
and Kampala wanted to put in Kinshasa someone malleable they could totally
remote control and so draw massive political, military and economic
dividends in the process. This ambition did not materialise.
As
soon as Kabila settled in Kinshasa, and started to articulate clearly the
aspirations of his people and summoning them to take their own destiny
into their own hands, politically and economically, this was perceived by
his sponsors as a covert declaration of independence. Kabila's nationalist
stance immediately clashed with their interests, as he eventually reviewed
all the contracts he had signed with American and South African mineral
companies under Mobutu (and when he was a rebel?) and re-nationalised all
the mines. De Beers subsequently pulled out of Congo in 1999. Earlier on
he had enlisted the support of Zimbabwe to enlarge his circle of friends,
should he fall out with the first ones. During the third summit of Comesa
(common market community of central and southern African countries) held
in Kinshasa on 29 June 1998, Kabila clearly tabled out what role Congo
would play within the common market and in Africa as a whole.
He
explained that 'more than 40 years of African independence have offered to
the world a sad spectacle of a continent looted and humiliated with the
complicity of its own sons and daughters'. He expressed the wish 'to see
Africa entering the 21st century totally independent of foreign
interference' and declared that the battle for Congo's independence and
sovereignty is fought in the interest of Africa as a whole.
'Our
country,' he said, 'has a vocation of exporting peace, development and
security to the rest of Africa. A weak Congo means a vulnerable Africa
from its centre, an Africa without a heart.' The stakes were then raised!
Even President Thabo Mbeki was prompted to say: 'The more time goes, the
more we will loose control of Kabila.' The rest is history. Shortly after
President Kabila's assassination, Colette Braeckman of Le Soir, a Belgian
daily, wrote: 'The people of Congo have no illusion as to who killed
Kabila. They know that his death was conspired by Western agents put off
by Kabila's nationalist stance and anxious of loosing their interests but
executed by an African and Congolese hand.'
There is now discussion
of opening up the major Congolese government-owned diamond mining company,
Société Minière de Bakwanga (MIBA), to foreign investors. President Joseph
Kabila has ended a unilateral monopoly of exploitation granted to IDI, an
Israeli mining company granted by his father, the late President Laurent
Désiré Kabila. MIBA accounts for 40% of the Democratic Republic of Congo's
official diamond exports. The remaining 60% are developed by artisanal
miners, that is, prospectors, who then sell the gems exclusively to
Israeli diamond buyers and to international gem dealer Maurice Tempelsman,
a former president of US Africa Society, a group that is influential in
the shaping of US government Africa policy.
Tempelsman is no
stranger in Congo, according to Janine Farrell Roberts, an American Human
Rights activist and author of 'Blood Stained Diamonds'. In April, she made
a presentation at a roundtable discussion organised by Congresswoman
Cynthia McKinney (D-Georgia), at the Rayburn House Office Building to
discuss American foreign policy toward Africa, in which she said: 'Maurice
Templesman, a private American citizen and businessman, served the De
Beers diamond cartel by promoting foreign policy decisions that favoured
its access to and control of African diamond fields. This led to the US
covertly supporting undemocratic and corrupt regimes in Africa to the
great detriment of the African people.'
Roberts further revealed
that when Lumumba, Congo's first elected leader spoke of using Congo's
resources to benefit the Congo, De Beers feared it would lose access to
the one third of world's diamond supply in the Congo - as would also
Tempelsman. Shortly after this, the CIA facilitated Lumumba's
assassination. Evidence on this came before the Church Intelligence
Commission. Immediately after Lumumba's death, the Acting Prime Minister
of Congo, Adoula announced support for a very major Tempelsman diamond
deal, telegramming this to President Kennedy. The historian Richard
Mahoney claimed that the Adoula regime was receiving funds from
Tempelsman. A State Department memo headed 'Congo Diamond Deal' stated
'The State Department has concluded that it is in the political interest
of the US to implement this proposal.' (2 August 1961).
Immediately
after Mobutu came to power, Tempelsman became an even bigger player in
Congo - recruiting his own staff from those CIA staffers that Mobutu most
favoured that put him to power. Mobutu also at this time gave Tempelsman,
as a 'Christmas Gift', rich mineral reserves.
According to
Tempelsman's staff interviewed, they had a wonderful time running the
Congo - to secure funding for Mobutu. He succeeded in persuading the White
House to secretly buy a vast number of diamonds for the US startegic
reserve - at a time when Adminstration officials were protesting that the
reserve was over full. The reason for this deal given in secret US
government memos was to support Mobutu and his partner Adoula. This
Tempelsman plan made much profit for him and De Beers.
A State
Department Cable of 23 December 1964 warned about the need of secrecy over
this Mobutu diamond and South African uranium deal because 'it could
outrage the moderate Africans we are trying to calm down.' It suggest
South Africa Foreign Minister Muller would understand the need for secrecy
since the US was 'doing a job' in the Congo that South Africa could not
do. This covert support for Mobutu gave the US a gross excess in the
strategic diamond stockpile that was still being sold off in
1997.
In 1967 the State Department reported: 'Tempelsman is playing
an increasingly central role as GDRC (Congo's) technical advisor and
mediator.' But these deals and other deals done throughout the following
decades with a corrupt Mobutu government left the Congolese people in
absolute poverty.
I interviewed Simon Guilbert, De Beers's
London-based Corporate Affairs Manager who spent 12 years in the
Democratic Republic of Congo.
This is what he had to
say:
NA: When the late President Laurent Désiré Kabila granted a
unilateral monopoly of diamond mining to IDI, an Israeli mining company,
where did that leave De Beers, which has the biggest player in the diamond
market not only in DRC but also in Angola for donkey years?
DB: We
were not affected because we weren't active there anymore at that time. We
were buying diamonds from other markets and so we were not competing with
anyone. We ended our operations in the DRC since the end of 1999 because
we could not sustain to buy diamonds profitably as the war escalated.
Since then we have not bought any single diamond from the DRC and that
still remains so at the moment. Secondly with the conflict diamonds issue
with a UN resolution coming through, we could not guarantee that any
diamond we bought in Tsikapa or Mbuji Mayi would not contain conflict
diamonds. That is the reason we closed all our offices. We maintain a
dwarf presence of six or seven people in Kinshasa and about four or five
people in Mbuji Mayi where we still have properties to be
maintained.
NA: The invasion took place one year earlier than the
time you closed your operations. Does that mean you were still trading
during the first year of war?
DB: You must know that we controlled
only 10% of the DRC diamonds market at the best of time. There were other
players bigger than us. But in 1998, Ambassador Fowler from the UN was
looking at the UNITA situation to see how UNITA was able to carry on with
the war without diamond connections. And then the same situation
transferred itself almost to the DRC where the rebels who then controlled
Kisangani were using diamonds to fund that war. We said then that if there
is going to be any kind of UN Security Council resolution against diamonds
coming from the DRC , we are morally - not legally - obliged to stop
trading because we could not then guarantee that if we carried on buying
diamonds from the DRC, there wouldn't be conflict diamonds from Kisangani
coming to our clients line. That was the overriding moral factor that
topped everything for us in deciding to leave. No matter how easy doing
business was, we would still have left because of the morality of conflict
diamonds.
NA: President Joseph Kabila has ended has put an end to
that monopoly as part of the economic liberalisation he has advocated
since coming to power. Does that represent a new window of opportunity for
De Beers?
DB: We have been approached recently by the government of
the DRC to resume diamond purchases. I think what we are looking for is a
stable legal framework from which to operate and establish businesses. A
new mineral code or 'Code Minier' as they refer to it needs to be
established and the conflict diamonds issue needs to be resolved.
NA: How is that going to be resolved since the war is still going
on and half of the country still occupied by a Rwandan-Ugandan-Burundian
coalition, backed by well-known superpowers and the complicity of
so-called Congolese rebels?
DB: That is a good question. All the
diamonds coming from Kisangani and other occupied territories are still
deemed to be conflict diamonds. And until the conflict is resolved it is
going to be very difficult for us to give absolute guarantee to our
clients that all the diamonds we will buy in the DRC remain conflict-free.
And therefore we have to be completely sure of the sources of the
diamonds. In the current situation in the DRC, it is quite difficult for
us to do that. We have a zero-risk attitude. We cannot afford the risk of
having conflict diamonds coming through our system.
NA: What do
you expect from the 'Code Minier' then?
DB: A solid legal framework
from which to establish businesses. We are extremely cautious but of
course we want to talk to everyone, we want to maintain relations. As soon
as there is that guarantee there, as well as peace and security, then we
will take negotiations a step further. We need to help this country going
again not only by buying diamonds which are one of its main resources but
also prospecting in new areas. We have the expertise and the resources to
do that.
NA: So, you will deal only with the government,
not the rebels?
DB: I wouldn't imagine anybody wants to deal with
the rebels. We would only deal with the legitimate government of the
country.
NA: But you dealt with Laurent Désiré Kabila when he was
still a rebel?
DB: I think we had talks with him and when he took
over the whole country, he was recognised as leading a legitimate
government. Only then did we open our buying offices from that point
onward. But to be honest we had a conflictual relationship with him since
some of the decisions he took were not conducive to our business agenda. I
refer particularly to the law forbidding the use of all other currency in
transactions in the country except the Congolese Franc, which, he said was
an instrument of national unity, political and economic sovereignty. I
think it generally agreed that he was not pro-West and trading conditions
particularly for the diamond companies became extremely difficult if not
impossible for us to operate.
NA: Don't you think Kabila was
absolutely right here? After all you maintained your presence in the
former Zaire throughout Mobutu's rule despite the fact that his was a
bloody, dictatorial and kleptocratic regime where there was no rule of
law?
DB: We had a contract with MIBA to buy the diamonds and to be
involved in diamond production from the mine. We mined and bought diamonds
from the MIBA mine. We were involved in the security of that mine and we
knew where the diamonds were coming from. We purchased those diamonds by
De Beers. We paid MIBA what we considered to be the market price for
diamonds at that time and that was our legal obligation. What MIBA did
afterwards is their own business. In 1987 we bought $66 millions worth of
diamonds. That money went into the Zairean economy. We paid taxes on all
those exports. What the government did with all that money is not our
business. We could not control that. Moreover, We contributed to schools
and local farming, our national support clients had properties, they could
send their children to school and they travelled. That was part of our
corporate social responsibility.
NA: Historically speaking, it is
said that De Beers played a leading role in Lumumba's downfall and the
propping up of Mobutu by Western powers, especially through the then De
Beers's agent Maurice Tempelsman. Can you corroborate that?
DB: I
don't think you can mix up De Beers with Lumumba in any way. I personally
was not around in those days but I am not aware of the Maurice Tempelsman
we know of and we communicate with to have acted or negotiated a deal on
our behalf. I would doubt it. I don't think we were even there in Congo in
1961. I have to verify that on our records to see when we started
prospecting diamonds in Congo.
NA: Finally, the UN set up a panel
of experts to report on the 'illegal exploitation of natural and mineral
resources and other forms of wealth in the DRC by invading countries and
multinationals. Does De Beers feel concerned?
DB: I think any
serious and educated person would be concerned about a report such as
this, telling of how other countries are looting another country for
financial gains. As far as we are concerned we are not there. We are not
involved in those activities simply because we are no longer active in the
DRC. But I think countries who have combatants inside the DRC should pull
them out and DRC's territorial integrity and national sovereignty upheld.
There is an internationally recognised Lusaka peace accord and cease fire
and we are all aware of Rwanda's security concerns, which hopefully will
dealt with by the UN by placing blue helmets along Rwanda's borders with
its neighbouring countries. There must be an internationally recognised
political solution to this problem. In case of private companies, any
individuals proved to be contravening the law of any country and illegally
exporting natural and mineral resources should be prosecuted as well as
the companies they work for. With global certification in the diamond
industry coming up it will be very difficult for anybody to deal in
conflict diamond, especially if they come from war torn countries such as
the DRC.
***NOTES***
Diamonds constitute 40-50% of Congo national GDP as it produces 22 to 28 carats per year, two third of which are rough diamonds. But today the double of this official production is fraudulently sold by Rwanda, Uganda, Burundi and Congolese rebels from London, Antwerp, Paris, Pretoria, New York and Tel Aviv, depriving the Congolese people of an important revenue to better their impoverished social life.
This is confirmed by the latest incident whereby five out of seven big boxes full all sorts of diamonds stolen from (the occupied territories?) in the Democratic Republic of Congo were held up, then raided by four men in arms at Zaventem airport in Belgium. The Belgian news agency Laattste Nieuws and its German counterpart Deutsch Agentur Presse (DAP) reported on the weekend of 3-5 November that the parcel belonged to the Berlin Government under the cover of a the German company called Brinziegler; and that it was in transit via Switzerland to Francfort, Germany, and supposed to be loaded by a Lufthansa aeroplane. They estimated the diamonds to be worth US$7.5 billion. However, Germany’s implication in the traffic of “blood diamonds” has astounded everybody. This theft must be providing the famous UN commission charged to investigate on “blood diamonds” with clues as to who is behind the spoilage of Congo’s mineral resources.
Moreover Uganda and Rwandan troops have twice fought against each other over diamonds in Kisangani, Congo’s third largest city and rich in diamonds since they invaded the country. The international community never condemned the atrocities which caused the death of more than 850 Congolese civilians who were clearly targeted by both sides.
It is true that diamonds have fuelled wars in Angola, Sierra Leone, and the Democratic Republic of Congo. But if these conflict are directly linked to the West’s arms trade, then Britain among many, must acknowledge that it is part of the problem.
The murky world of diamond trade is no longer murky because the flow between the UK and Belgium is certainly fuelled by illegal gems from trouble spots in Africa, namely Sierra Leone, Angola, and the Democratic Republic of Congo. And so it happened that Britain, a non-diamond producing country was pinpointed by the “Belgium Diamond Report of 2000” as having exported 40,000,000 carats of diamonds valued at more than US$2.8 billion to Belgium in 1999 alone. The 1998 export figures are of similar magnitude.
Elsewhere, British firms are pulling the strings in the conflict in Sierra Leone to safeguards diamonds concessions there. A Punch report published in its 4-17 October issue, written by Pete sawyer said UK Business interests have exacerbated the civil war in Sierra Leone in the relentless drive to control the country’s diamond resources, citing two British companies.
I f you really love Africa, and you are moved by a sense of justice, then it must really hurt your pride that the exploitation of Africa’s natural resources is no longer a covert issue.
The camel has literally passed through the eye of a needle as it is now ascertained that countries who have no diamonds under their soil have become some of the world’s prime exporters of this precious stone. The ridicule that surrounds the way they have stricken their fortune is no longer raising eye brows because the most powerful of this world have a stake in it. Blood diamonds conferences therefore amount to a sheer hypocrisy and distraction.
So what system of control on the sales of diamonds can really work is very difficult to say. For years now, the international community has wedged war against drug-trafficking, but has never succeeded either to curb the narcotic culture in the West nor the drug sales which has become one of the most lucrative trade in the world. Don’t tell us that the international community will succeed in eliminating the scourge of conflict diamonds when it has failed in tackling the illicit drug trade.
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