Professional Documents
Culture Documents
2015-2017
UON, IDIS
DECLARATION
I, the undersigned, declare that this research project is my original work submitted to the
University of Nairobi and has not been previously submitted in any other university for an
academic award.
Signature.. Date.
Dolly Kinyua
This research project has been presented for examination with my approval at the appointed
supervisor
Signature Date..
ii
TABLE OF CONTENTS
DECLARATION ...................................................................................................................... ii
DEDICATION ......................................................................................................................... vi
iii
1.8.3 Target Population ................................................................................................... 29
1.8.4 Sampling Frame and Sample Size ......................................................................... 29
1.8.5 Data Collection Methods ....................................................................................... 30
1.8.6 Validity and Reliability .......................................................................................... 30
1.8.7 Data Presentation and Analysis ............................................................................. 30
1.8.8 Ethical Considerations ........................................................................................... 31
1.8.9 Scope and Limitations............................................................................................ 31
CHAPTER 2 ........................................................................................................................... 34
CHAPTER 4 ........................................................................................................................... 86
iv
ANALYSIS OF CONFLICTS IN DRC AND MITIGATION MEASURES ........................ 86
Appendix II: Map showing 30 Non-State Armed Groups In Eastern DRC ..................... 115
v
DEDICATION
My parents Loftin Kinyua Mwirichia and Susan Kageni Njau, my amazing siblings Nicholas
Mugambi and Alexandra Joan Kawira for their unwavering support and encouragement. I also
dedicate this thesis to all the Congolese people who have lived decades of suffering. It is my
prayer that you will soon have peace, stability and a thriving nation.
vi
ACKNOWLEDGEMENT
The Almighty God has truly seen me through this journey, thank you heavenly father for
providing me this opportunity, resources and unconditional love that has sustained me
throughout this program. To my parents, I am sure that I would not have reached this far if it
were not for your constant prayers, encouragement and support. You pushed me to pursue the
highest level of education and I want to promise you that it does not end here. To my siblings,
I want to say I am entirely grateful for your love and support. I hope that I have laid a strong
foundation for you to emulate and I wish you both success in all that you set out to do.
To my supervisor, Dr. Patrick Maluki. Words cannot express how grateful I am for your
guidance, support and encouragement. I was almost quitting but your wise counsel kept me
going.
To my employer, United Nations Support office for Somalia, thank you for supporting me with
Lastly to all the respondents that took their time to be interviewed. Thank you for your
invaluable information and guidance the study was ultimately successful due to your insights
and responses.
vii
ABSTRACT
This thesis examines the role of state and non-state actors in financing the conflict in Africa
and provides an analysis of how actors fund rebels and state officials in a bid to continuously
destabilize the country for their own private commercial gains. Methodologically this thesis
takes a case study approach, studying the Democratic Republic of Congo and the evolution of
the war to its current state. DRC has experienced the worst conflict since World War II and
has been named Africas First World War. The rich mineral resources have been argued to be
the cause of this intractable war as ironic as it may sound. Furthermore DRC hosts the largest
United Nations peace keeping troops, and yet the war seems to only protract even in the fake
face of current peace. This research argues that state heads transnational companies and
intergovernmental organizations have played a role in fueling the conflict so as to reap the
benefits of unregulated mineral trade. The study aims investigate claims that state and non-
state actors directly fuel the war for their own private gain.
viii
CHAPTER ONE
1.0 Introduction
This chapter presents the background of the study, problem statement, the research objectives,
literature review, justification of the study, research hypothesis, the theoretical framework and
The study assesses the role of various non-state and state actors in financing conflict and
fueling wars in Africa for their own private gain. Reflecting on Africas experience in conflict
it is unfortunate that many parts of this great continent have suffered persistent violence and
intractable conflicts. Most of these conflicts have deep historical roots dating to colonial times
and many of them became more destructive in the post-Cold War period.1 These conflicts
have caused a flood of researchers seeking to determine and explain the prevalence of conflict
in Africa. The common factor established by researchers is that most of these conflicts have
occurred in areas that are predominantly rich in natural resources. However, the correlation
Logic instructs that the political economy of abundant natural resources should demonstrate
high economic performance, however, this is not the case in Africa. On the contrary, the
economies of many African countries rich in natural resources are poor and have little to show
1
E, Porter. G, Robinson. M, Smyth. A, Schnabel. & E, Osaghae. (2005) Researching conflict in Africa: Insights
and experiences.
2
Michael, L. R. (2005), How Do Natural Resources Influence Civil War? Evidence from Thirteen Cases.
1
for their endowment. The Countries that have been documented to be rich in natural resources
but suffer the resource curse include Angola, Sierra Leone, Liberia, Congo-Brazzaville,
Democratic Republic of Congo, Equatorial Guinea, Central Africa Republic, Libya, Sudan and
South Sudan.3
Since the late 1990s scholars have studied the relationship between natural resource wealth
and civil war. The assumptions and conclusions drawn from many of them are that the struggle
for equal distribution of wealth for the populous of this nations drives the conflict. In recent
studies, however, a new phenomenon had emerged where scholars explored the possibilities
of conflict being fueled and instigated by other actors other than the citizens of that nation.
The Study explores how nonstate and state actors have contributed to conflict by financing
rebel groups and state heads so that they can gain access to the unexploited natural resources.
Some scholars have emerged to link the two by exposing the involvement of non-state actors
in conflict areas through what is now termed as booty futures.4 Ross has described booty
futures as the ability of combatants to raise funds by selling exploitation rights to natural
resources that they hope to capture in battle. His argument brings out what political economy
theorists discuss as conflict financing. It begs the question who are the culprits in natural
resource conflict the buyers of exploitation rights who range from sovereign states,
transnational companies and to some extent international organizations or the sellers; rebel
groups or unstable governments? Perhaps it may not be academically prudent to analyze the
3
William, T. (2007). Governments and Politics in Africa. P.9 the emergence of states failure can be linked to
resource distribution precipitated either by internal or external insurgencies that are fighting for natural resource
control.
4
Ibid.
2
real culprits however it will be important to critically analyze and discuss conflict finance in
Attempting to explore all African nations that have experienced civil war due to the rich
endowment of resources will be too large and broad for constructing any meaningful
discussions or even drawing objective conclusions.6 The study will focus on the Democratic
Republic of Congo (DRC) a nation that has been said to possess every natural mineral in the
periodic table of elements and the most wanted of them are: Coltan, Gold, Cobalt, Tin,
Tungsten, Uranium, Petroleum, Copper and Diamonds. Despite all this wealth, DRCs
DRC has faced decades of armed conflict its volatility is typical of the large upheavals of weak
governments in Africa; its plight is much like other situations which caused large
humanitarian loss that shocked the international community yet have resulted in little actions.
Due to the chaotic political nature of DRC both the leaders and citizens led by rebels have
opted to liquidate their long-term resources in order to survive in the short term. Multi-national
mining companies and state heads of neighboring nations have decided to capitalize on this
dilemma.
Laurent Desire Kabila ascended to power when he signed a $1 billion contract with the
American Mineral Fields Inc in exchange for diamond purchasing monopoly. After the war,
they also received exploration rights to cobalt, zinc, and copper7 so as to create the world's
5
Louisa, C. (2012), Conflict Minerals in the Congo: Blood Minerals and Africas under reported First World
War. Suffolk University p.3-5
6
C. Ketterling and C. Papademas Capitalizing on chaos. DeBeers and American Mineral Fields Involvement
in the Congo and Suggestions for Regulationp.3
7
E, Porter. G, Robinson. M, Smyth. A, Schnabel. & E, Osaghae. (2005) Researching conflict in Africa: Insights
and experiences
3
largest zinc smelter and build a plant to produce acid for refining. When the deal was
announced the price of AMF stock in Toronto stock exchange rose from $3 to $7 and when
Rwanda and Uganda were very instrumental in the first war that broke out in 1996 they claimed
to fight for justice but it was evident that their fallout was precipitated by the failure of Kabila
to honor the booty futures agreement after ascending to power.9 To protect himself from his
neighbors Kabila sold future exploitation rights to Zimbabwe, who in turn offered their
support. Zimbabwe gave Kabila 11,000 soldiers when his adversaries launched an attack on
him and immediately after that Zimbabwean businessmen started trooping into the mineral
Conflicts in Africa have been well documented but none poses a significant threat to the
stability of the continent as the Congo war. DRC is strategically located at the center of Africa;
this means that the risk of instability to the rest of Africa is imminent. The Domino effect of
the war would create a serious crisis for Africa that could leave it vulnerable to destruction.
Other than the risk of spillover wars Africa as a whole is losing out on the benefits that can be
gotten from an organized regional integration. DRCs natural resources have the capacity to
make Africa an economic giant. A good example of DRCs ability to empower the rest of
Africa was the attempt by politicians and planners from across the world who have been
8
Edward, G & Materson, T. (2002).
9
Edward, G & Materson, T. (2002). Governance Quality and Governments Commitment. p.45. The Fragile
Peace.y
10
Wennmann, A. (2017). The Political Economy of Conflict Financing, political economy of conflict, conflict
financing, natural resources, and organized arm groups.
4
working together in the last four decades to build one of Africas largest dam the Great Inga
dam. The dam is said to have the capacity of harnessing enough hydroelectric power for the
whole of Africa and even export to the rest of the world. However, due to DRCs continuous
instability, the project has stalled. The above project is just one of many projects that have not
kicked off due to the conflict in DRC. Africa may be losing out on crucial projects but the
citizens of DRC are the biggest losers. According to World Bank, only 11.1% of DRC
population have access to electricity. For a country that has huge potential to harness
hydroelectric power, it is unfortunate that such a small percentage of the population have
access to electricity. This translates to poor economic growth which leads to violence and
eventually full-blown wars that pose a threat to neighboring countries and Africa as a whole.
The aim of this study is to deviate from the norm propagated by different scholars and the
media, that the war in Congo is instigated purely by rebel groups in DRC. The studys objective
is to bring in a new dimension by investigating and analyzing how state and non-state actors
finance the war in Congo by buying future exploitation rights from rebel groups. As stated by
one Congolese national in the documentary The Testimony For Africa to take off it must start
in DRC. As simple as this statement sounds the truth behind it is too colossal to ignore. This
study interrogates the following research questions; What is the History of the war in DRC and
is the presence of mineral resources fueled the conflict in DRC?; Who are the main actors in
the DRC conflict and do they prolong the conflict? ; What are the reasonable possible measures
5
1.3 Objectives of The Study
Overall Objective
To establish whether the conflict in DRC is financed by state and non-state actors.
Specific Objective
1. To establish the role of the state in DRC war and the use of booty futures as a catalyst
to the conflict.
2. To identify actors who contribute towards conflict finance in DRC and investigate ways
3. To assess current and future international policies that can be utilized to leverage DRC
Natural resource and civil war correlation have encouraged the proliferation of scholarly and
policy studies. The consensus built in the various discussions is that natural resources in
resource-rich countries act as the root of violent conflict. Although these deductions are true
This study seeks to explore other factors that have not been widely discussed both academically
and empirically. However, scholars who have attempted to critically study the relationship of
these conflicts have not explored all possible explanations that explain natural resource
conflict. In this regard, the study seeks to investigate how actors in international relations
finance conflict in DRC fueling the war to ensure instability for their own personal gains.
The concept of booty futures is a new concept to many peace and security scholars. Collier and
Hoeffler have critically analyzed the issue of conflict finance and natural resource exploitation
6
in Africa and have mainly concluded that the reason behind the conflict is greed on resource
allocation mainly headed by rebel groups. Although these arguments are true, little has been
written on the other side of conflict where is it seen as an investment for economic gain.11
Ross, on the other hand, argues that rebel groups are unable to physically loot a countrys
natural resources but the booty futures market allows them to raise startup funds by trading
future rights to exploit there nations resources for financial backing.12 The study appreciates
previous research but it has also noted the gap and thus seeks to widely examine and conduct
relevant research that will critically discuss and analyze the actors involved in buying and
Although the concept of booty futures is fairly new in the academic field, international
organizations have noted the threat posed by natural resource conflict and in 2003. The
jewels" from entering the standard unpleasant precious stone market by United Nations
General Assembly Resolution 55/56 following suggestions of the Fowler Report. The
procedure was set up "to guarantee that jewel buys were not financing viciousness by revolt
According to international standards, the policy document was above board, but what needs to
be understood is that all solid mineral conflicts have their own dynamism and therefore a
universal approach in most cases cannot resolve all cases conflict minerals.13 KPCS so far has
not been able to serve DRC as a policy that could help curtail the war.
11
Collier, P and Hoeffler, A. (2002). Greed and Grievance in Civil War. p. 1. We have found that greed out
powers grievances.
12
Michael, L. R. (2005), Booty futures. P. 7
13
See. Kimberly Process Certification Scheme. Each country must designate an importing and exporting
authority., establish a system of internal control
7
The Kimberly process is not the only policy that the international community has put in place
to try and curtail the sale of minerals from natural resource conflict. The US Dodd-Frank Act
(Called the Obama law in Congo) enacted in July 2010, imposes a series if duties to mining
companies to ensure they respect conflict minerals that serve to finance conflict the DRC or
adjoining countries. These duties included specific disclosures as regards to mining products
and their production, source and chain of custody, health and safety data and payments made.14
The financial reform bill was aimed at transforming Eastern Congo, which had been labeled
the "rape capital of the world. Its intended purpose was to ensure US companies publicly
disclosed their efforts to ensure that their products were free of "conflict minerals" from DRC.
However, critics from industry experts cautioned that the murky nature of the conflict in DRC
Enterprises. They cover an extensive variety of ranges, including human rights and the earth,
and expect organizations to add to a nation's financial, social and ecological advance. The
OECD activity tries to manage corporate conduct through governments. To this end, the
following nations must set up a National Contact Point (NCP), which is in charge of advancing
corporate obligation and encouraging commonly concurred answers for issues that emerge
around there. To accomplish these objectives, NCPs are enabled to get protestations about
corporate rowdiness, and subsequently are, in principle, the nearest thing to a genuine
responsibility system for organizations. Be that as it may, the OECD gives individuals total
adaptability in planning their NCP, and most nations have neglected to initiate a successful
14
H. Andre-Dumont (2011) Mining in the Democratic Republic of Congo. McGuire Woods Brussels Belgium
M. Sheridan. Global Policy Forum U.S. Financial Reform Bill also Targets 'Conflict Minerals' from Congo.
15
8
protests technique or to guarantee that their NCP has the status or profile important to put
significant weight on corporate performers. The US NCP, for example, is one of many caps
worn by the Office of Investment Affairs. It has no different presence and does not have an
institutional design.
The report discharged by OECD in 2004 demonstrates that administrations have neglected to
research the part of multinational companies in the contention in DRC. In any case, the United
Kingdom has given its NCP the obligation to get and analyze proof and issue open reports on
corporate misconduct. However regardless of the possibility that the NCPs were to understand
their potential, this instrument still depends on the shame of terrible exposure instead of any
legal cure a methodology that lone works when the reputational expenses to the organization
are not exceeded by the material increases from drawing in with states that are rich in minerals
yet poor in human rights administration. For instance, the attention encompassing the UN
reports did little to stop the plundering in DRC: for instance, the report demonstrates that a
British organization Afrimex, had paid cash to a revolutionary gathering in charge of genuine
human rights infringement and consequently, the renegade gathering enabled Afrimex to
separate minerals from mines under its control mines in which constrained work and perilous
The UN has recognized the requirement for more noteworthy oversight of multinational
companies and their effect on human rights. In 2005, Professor John Ruggie of the Harvard
business and human rights. Since his underlying arrangement, Professor Ruggie directed
counsels over the globe, accumulating data on the status of corporate responsibility measures
in different nations and at the transnational level. His outcomes uncovered that there was far
9
reaching disappointment of states to guarantee that companies watch human rights. Obviously,
organizations missed the mark concerning moral benchmarks, states reliably neglected to
consider them responsible, and Ruggie a year ago called for proactive strategy intercessions
by states to control the inclusion of enterprises in strife circumstances. To this end, he has
proposed a tripartite system, incorporating the state's duty to secure against human rights
infringement, the general arrangement of sufficient solutions for casualties of human rights
infringement, and the corporate obligation to regard human rights and work as per social
desires. Ruggie is right now during the time spent operationalizing this tripartite system.
raised by transnational corporate unfortunate behavior is yet to be seen. Sadly, despite the fact
that the system may offer answers for end MNC's gross infringement on human rights it may
be past the point of no return for the millions enduring in the DRC.
For the international community, individual states and organizations, the difficulties are
critical. Indeed, even organizations with the best expectations require direction to guarantee
that their cash isn't being channeled into the prolongation of a contention or the propagation of
human rights mishandle. One-sided measures by states must surmount the confinements of
between both state and non-state actors.16 As realists would put states only serve their own
interests and multinational companies by extension serve the interest of the parent country thus
it would be a challenge to assume that the companies would easily forfeit the benefits gained
noting that there could be bureaucratic pressure from their countries. It could swing the other
way as well if the parent country wishes to maintain good relations with states that the MNC
16
Ibid
10
are doing business and violating human rights, they could call them to book and force them to
The resurgence of the conflict in the DRC and the mercilessness created upon regular folks is
an update that multinational organizations can't be permitted to offer help to those that execute
barbarities. They can't be permitted to choose not to see to the effect that they or their backups
who have been propagating a cycle of brutality. The expansion of corporate social duty mottos
and industry self-direction has not been adequate to counteract corporate complicity in
monstrosities in the DRC. Society must demand that corporate responsibility rises above
fringes. Governments must be proactive in observing and reacting to the activities of their
organizations abroad. Something else, organizations will keep on doing business in battle
areas, where they are beyond anyone's ability to see of controllers, with the imperceptible hand
The study, therefore, wants to investigate different policies that have been put in place and also
to develop academic policy recommendation that can be used to find solutions that will curb
conflict finance. Wennmann insists that peace and security scholars should do more research
and write more about the concept of booty futures so as offer different scholarly discussions
as opposed to the traditional means of looting and smuggling that everyone knows about. It is
17
Ibid
11
1.5 Literature Review
The literature review was structured into five thematic areas; Economic explanations for
natural resource conflict in DRC and regulatory measures in DRC to curb conflict finance.
The term Conflict has been defined by international relations scholars as an actual or perceived
opposition of needs, values, and interests. A realist would argue that conflict is necessary
among actors in politics pursuing power. In Africa, the perceived opposition of needs and
interests have been at the core of explaining the conflict. However, an opposition based on
values has also taken center stage in discussing causes of conflict and civil war. The greed and
grievance arguments have been put forward by scholars to try and explain conflict. "Greed" is
when combatants are motivated by a desire to better their economic situation and perform an
informal cost-benefit analysis in examining if the rewards of joining a rebellion are greater
than not joining. "Grievance" stands for the argument that people rebel over issues of identity,
In the case of Africa greed seems to be the most appropriate argument in explaining the
conflict. The private motivation hypothesis explains how greed acts as a motivating factor in
precipitating war. It argues that people who might have their own private motivation for doing
so as well as loyalty to the group that it is fighting for. Wars confer benefits as well as costs on
some individuals. The private motivation hypothesis has its basis on rational choice economics
arguing that the net economic advantage of the war to some individuals motivates them to
18
https://en.wikipedia.org/wiki/Greed_versus_grievance
12
fight.19 Relating greed hypothesis to booty futures concept, the study analyzes private motives
of state and non-state actors in instigating and sustaining conflict, by buying future exploitation
rights for natural resources in DRC. The result of this is the emergence of a war economy that
Goodhand contends that war economies include the obliteration or circumvention of the formal
economy and the development of casual and bootleg trades, viably obscuring the lines between
the formal, casual and criminal parts and exercises. Loot, predation, blackmail, and consider
viciousness against regular citizens is utilized by soldiers to secure control over lucrative
resources, catch exchange systems, diaspora settlement, and endeavor work.20 To sufficiently
survey the diverse elements of war economies, Jonathan Goodhand proposes an especially
screen characters, inspirations, and financial exercises that can have subjective diverse
In this study combatant economies better explain the interactions that directly sustain actual
conflict in DRC. By and large, the battle economy serves to finance the war exertion of these
on-screen characters and in addition to accomplish military goals.22 The favored methods for
asset age incorporate the savage tax assessment of licit and illegal monetary exercises,
blackmail of nearby organizations, the control over the misuse of normal assets, the burden of
19
Duffield, M. (1999) Globalisation and war economies: promoting Order or the Return of History? Fletcher
Forum of World Affairs
20
Goodhand, J. (2004). Afghanistan, in Pugh M and N Cooper, with J, Goodhand (2004).War economies in a
regional context: challenges of Transformation. Boulder: Lynne Rienner publishers.
21
Ibid.
22
Duffield, M. (1999) Globalisation and war economies: promoting Order or the Return of History? Fletcher
Forum of World Affairs 23(2) p.19-36.
13
"traditions" in outskirt zones or setting up barriers and the offer of future asset abuse rights to
Michael Ross tops the list of scholars behind the concept of booty futures, he coined the
concept after the Cold War. Ross was trying to find the correlation between natural resources,
civil wars and coup dtats. To enable him to justify the concept of booty futures Ross
developed the use of triangulation through developing several hypotheses and examining
several wars that had happened in countries with rich mineral deposits.24
Ross explains the concept of booty futures in very simple terms, as the right to exploit mineral
resources that the seller has not yet captured. Ross further posits that the strategy of booty
futures is a tool used by the weak against the strong.25 In Sierra Leone, Liberia and Congo
Brazzaville rebel groups sold their rights for future exploitation to foreign firms and
neighboring countries in exchange for proceeds to buy arms to capture resource endowed
regions. In Congo Brazzaville, for instance, President Denis Sassou Nguesso received $150
Million from Elf a French oil company, to enable him to topple over the then President Pascal
Lissouba from power democratically or through an arms struggle, however, the latter saw
Sassou Nguesso into power. Upon Nguessos inauguration, Elf secured itself extraction rights
23
Ibid.
24
L. R. Michael (2005), Booty futures. p.4
25
Ibid, p.2
26
L. R Michael (2005), How Do Natural Resources Influence Civil War: Evidence from 13 Cases, Cambridge:
University Press. The payment done to Sossou was to clearly allow elf access to Congolese oil in once he takes
over government.
14
Collier and Hoeffler link the concept of booty future to the narrative of grievances versus greed.
Both scholars allude to the fact that most MNC and rebel groups are driven by greed as opposed
to the grievance, that is because in most cases their primary concern has always been to capture
the well resource endowed regions, their quest for power is to enable them to have control over
the vast mineral regions for financial gains. However, some rebel groups have always had
Collier and Hoeffler admit that even sovereign states engage themselves in the strategy of
booty futures but it is due to grievance. Collier argues that a good number of states engage in
the strategy mostly when their existence has been threatened by stronger rebel groups and they
must, therefore, seek alternative measures to survive thus resorting to the sale of booty futures.
Collier refers to Sierra Leones case that repulsed a civil war twice. The success to repulse the
war was arrived at after selling booty future rights to Konon diamond fields a South African
Mining company that later supplied the Sierra Leonean government with Mercenaries to
The end of the Cold War in 1989 triggered the growth and development of conflict finance in
natural resource-endowed developing countries. This was due to the reduction of support from
western powers too weak states and guerrilla groupings. The declining support from external
powers meant that weak states and guerrilla groupings had to fend for themselves for their
survival. It is upon that backdrop that developing States and Guerrilla groupings resorted to
27
Collier, P and Hoeffler, A. (2002). Greed and Grievance in Civil War. p. 1. We have found that greed out
powers grievances.
28
Collier, Paul and Ankle. (2002), Greed and Grievance in Civil War. Working Paper CSAE WPS, Oxford:
Centre for the Study of economics.
15
29
the commercialization of conflict. In Afghanistan, for instance, the American government
was giving the Mujahidin rebel groups $3Billion to sustain it's 200,000 300,000 soldiers, but
the end of cold war marked the end of the support to the Mujahidin rebels they were thus forced
to look for alternative support to finance their course and thus the recourse to annex oil regions
The end of the cold war also came with new economic policies through the structural
adjustment programs. SAPs expected African states to liberalize their economies to the outside
world. Liberalization of African economies meant Africa opening her markets to the outside
world for extraction of her primary commodities.31 Liberalization led to competition of control
over the resource-rich regions, scrambling and partitioning provoked conflict that eventually
contributed to conflict finance. For instance in Angola, UNITA rebels charged a landing fee of
$2000 3000$ per plane, in the territory under its control during the period of 1996 1997 of
which the money earned was alleged to have been used to fund the civil war in Angola.32 SAPs
called for open markets and this led to the high demand for Africas natural resources,
competition became intense leading to zoning and the claim for rights over resource endowed
regions by both governments and guerrilla groups. Customers who wanted access to primary
commodities had to, therefore, pass through cartels that had control and rights over the
29
Abdullah. I. (1998), Bush Path To Destruction: The Origins and Character of the Revolution United Front. P.
36
30
Choudy. K. (1997). The Price of Wealth: Economies and Institutions in the Middle East. New York: Cornell
University Press.
31
See, World Bank and International Monetary Fund, (1990). Report on Structural Adjustment Policies in
Africa.
32
Enough Project, (2008). Armed Group Profits-3Ts and Gold.
33
See, in particular faced, faced with a Gun, What Can You Do? War and the Militarization of Mining in
Eastern Congo.
16
The concern to address the humanitarian situation during the post-cold war period contributed
to the growth of conflict finance as well. NGOs were taxed before they could offer aid
assistance to casualties. Many times the aid provided was stolen and sold to fund conflicts. It
is therefore evident that through taxation and selling of the aid donations rebel groups were
able to raise finances to steer violence. Pseudo NGOs have also been accused of being used
to smuggle in weaponry to governments and rebel groups, and the same measures used to
smuggle out minerals because non-state actors enjoy leverages from taxation and inspection
The absence of good governance and rule of law act as a catalyst for conflict finance.
that most African regimes were unpopular by the end of the cold war and because they were
unwilling to relinquish the power they decided to militarize politics.36 Militarizing politics
meant spending more budgetary allocation to the military of which in most cases a good
number of African governments could not afford them thus opted to conflict finance. Uganda
and Rwanda have been accused of looting mineral deposits from DRC to finance their
military.37
International trade and the high demand for solid minerals in DRC has precipitated conflict
finance and thus a contribution to resource conflict through the supply chain. In as much as
governments issue official extraction rights to MNC, extraction of the minerals has posed a
34
Ibid.
35
Auvinen, J. (1997). Political Conflict in Less Developed Countries. p. 34
36
William. T. (1997), Government and Politics in Africa. P. 177, in 1994 France had an estimate of 8400
troops deployed in Africa to quell coup dtats.
37
Ibid.
17
challenge because the minefields are still under the control of rebel groups. Companies are
therefore forced to re-negotiate with the rebel groups, the negotiation, therefore, establishes a
The supply chain is complex with various actors drawing payments from the chain, goal posts
get shifted and different mechanisms are deployed to avoid official authorities. However new
demands reemerge from the various actors involved, a good number of them feel short-changed
whereas some fail to fulfill their bargains and with that comes disagreements and the conflict
explodes again.39
The dilemma between militarization of politics and privatization of the state in Africa as noted
by Ali Mazrui, led to the emergence of a new trend of using mercenaries to solve political
problems. Several African countries were reported to have used mercenaries for example in
Sierra Leone a South African company by the name Executive Outcome helped president
Kabbah at the time to regain control of the mineral-rich regions. Within a month of Sierra
Leone's hiring of Executive Outcomes in May 1995, government forces had regained control
of the diamond-rich Kono district, which produced two-thirds of Sierra Leone's diamonds.
However, their involvement did not bring any stability, in fact instability was their function of
continued employment.40
The use of mercenaries was not unique to state heads. Multinational companies operating in
war torn countries do not want to be associated with political conflict especially in their
operating environments. Logically most of this companies have every reason to help end
38
Karlsson, Ida. EU Urged to Ban Conflict Minerals.
39
Ibid.
40
Cilliers J and Cornwell R (1998). Africa- from the privatization of security to privatization of war.
https://issafrica.org/uploads/PEACECHAP11.PD
18
conflicts so as to have a safe environment to operate in however, the reverse is true.
Multinational companies have grabbed the opportunity to exploit the situation as they have
noted that the commercial gain is too huge to resist.41 Due to international pressure companies
rather operate aloof so that they are not directly linked to the conflict and this is how
mercenaries have gained popularity in financing conflict and prolonging it in Africa. In the
subsequent chapters the study will dive into the different companies and their involvement in
The Democratic Republic of Congo is well endowed with solid minerals and a vast coverage
of forest that is second in the world after the Amazon forest, it is however unfortunate that over
50% of her natural resources are controlled by rebels groups.42 Grant Matterson argues that
mineral resource conflict in DRC was epitomized at the onset of independence. Patrice
Lumumba and Kasavubu Joseph had different ideologies. Lumumba was a nationalist and
believed in socialism, Kasavubu, on the other hand, was a radical secessionist and believed
that DRC had to be partitioned. Kasavubu leadership was driven by a higher appetite to loot
the mineral resources in DRC.43 The difference between Kasavubu and Patrice led into a
constitutional crisis, this was due to Kasavubu dismissing Patrice as the Prime Minister
whereas Patrice rushed into the national assembly to defend his position during the period of
41
ibid
42
Abiodun, A. (2007). Natural Resources and Conflict in Africa: The Tragedy
43
Carpenter, L., & Conrad, J. (2012). Conflict minerals in the Congo: Blood minerals and Africas under-
reported first world war. Suffokl University Working Paper, April 2, 125.
19
constitutional crisis Mobutu being the Chief of Staff of the Armed forces ruled the country for
The first conflict in DRC broke out in 1996 which was fronted by Laurent Kabila against
Mobutu Sese Seko, Laurent was successful in ousting the former in as much as their
antagonism was perceived to be more of a political struggle the major underlying issue was
the control of mineral resources. A good number of political analysts argued that Mobutus
ouster was as a resort of regime change that was cutting across Africa to replace dictatorship
with democracy. Well, that might be true but security scholars have emphasized that it was a
Paul Collier reiterates that Intrastate conflict in DRC is being precipitated by poor governance
and marginalization. Those charged with governing DRC have extracted natural resources to
fulfill their selfish interests leaving out the populace to wallow in abject poverty thus a
precursor to the conflict in DRC.46 Marginalization breeds a mentality of we verse them and
thus a recipe for conflict. Collier further reiterates that when easily extractable mineral
resources are not well managed they become susceptible to looting, where looting cartels and
rebel groups demarcate regions to claim ownership of the resources. The act of demarcation
by cartels eventually breeds rebel groups that resort to conflict.47 Duffield, on the other hand,
attributes natural resource conflict in DRC to warlords. He views a warlord as the leader of an
armed group, who can hold a territory locally and operate financially and politically in the
international system without interference from the state in which he is based. Warlords,
44
Ibid.
45
William, T (1997). Government and Politics in Africa. p. 197
46
Paul. C (1998). On Economic Causes of Civil War, Oxford: Economic Papers.
47
Ibid. p, 563.
20
therefore, have the ability to lead a revolt against the government and extract the minerals for
External interest, interference, interventions, and Involvement by the nine DRC neighbors have
contributed to both Intra and interstate conflict. DRCs neighbors have constantly argued that
their intervention into the conflict has always been triggered by the influx of refugee into their
countries. Rwanda, for instance, is hosting an approximation of about 70,000 refugees from
the DRC. Their mission, therefore, has always been to stabilize the country so that they avoid
the refugee burden. Paul Collier, however, insists that DRCs neighbors intervene so that they
can profiteer from the conflict.49 Emizet Kisangani insists that whenever neighbors intervene
in DRC they come with their own agenda.50 Uganda for instance intervened in DRC (I) to deny
the Sudanese government an opportunity to destabilize Uganda through the eastern DRC, (ii)
to deny habitation to Ugandan dissident United Democratic Front (UDF) (iii) to ensure that the
rebel dissident in Eastern DRC do not destabilise Uganda, (iv) to protect Ugandas territorial
integrity from invasion by DRC rebels, all that said and done independent reports have linked
The Lusaka peace accord, for instance, flopped because both Uganda and Rwanda had some
interest in the clause that called for the withdrawal of their troops from DRC. They, therefore,
wanted the Accord to be re-amended to reaffirm their presence in DRC.52 Uganda and Rwanda
48
Duffield, M. (1998). Post Modern Conflict: Warlords, Post Adjustment States and Private Protection,
London: Routledge. The changing nature of the nation state has changed the rule of law.
49
International Conference on the great lakes regions pact on security, stability, and development in the in the
great lakes region. (2006)
50
Emizet, K. (2010). Civil Wars in the DRC. Kansasa State University.
51
Human Rights Watch. (2005). DRC faces continues interference from her neighbors Rwanda and Uganda in
particular.
52
Lusaka Ceasefire Agreement. (1999). A peace agreement between the DRC and the Republic of Rwanda on
the withdrawal of the Rwandan troops from the territory of DRC.
21
have in many at times wanted to dominate the intervention events in DRC. For instance,
Ugandan People Defense Force and Rwandan Patriotic Front, have constantly refused to have
a joint mission team in DRC, they all want to operate independently because of the command
structures.53
Human Rights Watch a leading NGO has consistently insisted that whenever natural resource
conflict in DRC is being discussed or researched about, it should not go without mentioning
the humanitarian situation in DRC. The NGO states that in the year 1996 800,000 persons were
displaced and the subsequent years 1999 2002, 3.3 Million lives were lost, an equivalent of
genocide. Crimes against humanity have been perpetrated ranging from, rape, forceful
eviction, the use of child soldiers and displacement of persons. The listed crimes have been
committed by both the state and rebel groups. Detentions and warrant of arrest issued to the
perpetrators have posed a security challenge to DRC because the indicted persons are very
powerful and influential.54 As NGOs report on the atrocities being committed, it is also
prudent that they look at the source which propels the violence in DRC ensuring it ensues with
no hope of it ending. The responsibility of documenting human rights violations should not
only stop at the perpetrators on the ground, but they should also search deeper. The fact is most
of this atrocities are committed by rebel groups who are funded by known groups to ensure
instability in the areas rich in resources so that they can gain access to them.
53
Edward, G. & Materson, T. (2002). Governance Quality and Government Commitment to the NEPAD.
54
International Criminal Court. (1998). the Rome Statute. Rape, Genocide, Forceful Eviction, all the above are
crimes against humanity.
The Prosecutor V. Bosco Ntanganda, Thomas Lubanga, Germaine Katanga, Mathieu Ngudjolo and Sylvester
Mudacumura.
22
1.5.5 Regulatory Measures in DRC to Curb Conflict Finance
Kimberly process has been the universal policy document on solid minerals, it has also fallen
short in curbing conflict finance on other solid minerals like coltan, tin, tantalum, and tungsten
used to make electronic materials. The Kimberly certification process was specifically
developed to curb blood diamond and not all solid minerals that contribute to the finance of
conflict. 55
Paul Collier reiterates that to curb conflict finance, the DRC government must undertake key
reforms in its governance structures. It should first ensure that all the mining fields are brought
under state control to provide a revenue base for local and provincial authorities. All
stakeholders and actors in the solid mineral trade must be brought together for a dialogue on
alongside the DRC government, the authority should be in charge of certifying traders and
other actors the authority should also be in charge of all mining fields by overseeing the
activities that are being undertaken at a local level and also evaluate the supply chain racket.57
Export policy and incentives must be harmonized at a regional level to eliminate smuggling.
For instance, an exporter will pay a taxation fee of $200 for a barrel of tin ore being exported
from Rwanda to Europe, an exporter in DRC will pay $6,500 for the same barrel to be exported
to Europe. It is such inequality that promotes conflict finance through smuggling, countries
55
See, The Kimberly Certification Process. https://en.wikipedia.org/wiki/kimberly.
56
Collier, P. (2009). Wars, Guns and Votes. Democracy in Dangerous places.
57
http://www.itri.co.uk/POOLED/ARTICLES/BF
23
from the great lake region should, therefore, develop a unifying protocol on natural resources
that bring a regional pact, upon its development the Heads of State should adopt the protocol
The various peace accords that were signed under the Unified Transnational Agreement
should be operationalised and adhered to the letter. The four peace agreements are the Lusaka
Ceasefire agreement (1999),59 the Sun City Agreement(2002), the Pretoria Agreement (2002),
and the Luanda Agreement (2002).60 The peace agreements are important because it is only
through them that the Humanitarian situation in DRC can be addressed through supporting
livelihoods. The conflicts in DRC has seen gross violation of human rights. World Bank,
however, insists that the Universal Kimberly Policy certification system has been the best
policy developed by the United Nations despite its shortfall in DRC. However much still needs
to be done to ensure that the underlying issues of natural resource conflict are addressed.
The concept of conflict finance and the phenomena of booty futures is still new to scholars of
international relations. Academic discourse on conflict in Africa has been dominated the
repetition that conflicts are mainly caused by poor governance, mismanagement of resources
and greed. Scholars have intesively researched on this issues and to some extent come to the
conclsion that those are the main factors that instigate conflict in rich natural resource areas.
The study however, during its research concludes that even though the factors mentioned above
are true there is a missing link. The commercialization of war for private gain or conflict
58
Ibid.
59
Among the first peace agreements to be signed it was the first road map towards pacifying DRC.
60
The Lusaka Ceasefire agreement (1999), the Sun City Agreement (2002), the Pretoria Agreement (2002), the
Luanda Agreement (2002), the Unified Transnational Agreement.
24
finance act as the missing link. The media has also been silent about the involvement of state
and non state actors in fueling conflict even though the situation is puzzling.
The study of international relations involves a wide variety of issues. The conflict has been at
the center stage of those issues as it affects states and how they interact with one another. The
war in DRC showcases the relationship of both state and nonstate actors and how their
relationship has contributed to the never-ending conflict. To critically understand this war there
are a number of theories that could explain its causes however this study focused on Political
Economy theory.
Political Economy theory suits the study since it is better placed to explain the growing
commercialization of contemporary intrastate conflict that majorly arises from the extraction
of lucrative natural resources for trade purposes, to attract revenue and favors for both
Political Economy theory therefore defines and describes how politics and economics have a
deep correlation and interdependence. Economics is the means under which natural resources
are extracted for trade purpose whereas politics, on the other hand, is the ability to determine
who gets to extract the natural resources. Economics therefore at this particular juncture is
forced to highly depend on politics so as to get the authorization and sole right to exploit the
61
Nitzschke, H. (2017), Business and Conflict: An Assesment of Issues and Options, NewYork: Fafo Institute.
25
resources. The latter therefore explains the sole principle of booty futures whereby support is
Every community has resources and they are always scarce in relation to those who want to
exploit them, resulting in unhealthy competition. Economic entities, therefore, resort to wheel
dealings in exchange for lucrative contracts that can ensure their business entities secure a
monopoly, market protection, friendly regulations and eventually long contracts. To achieve
the latter, economic entities have gone to the extent of weakening unfriendly regimes by
financing and arming non-state actors ranging from opposition leaders to rebel groups with an
agreement that once they ascend to power they would ensure that the economic entities that
offered their support in their endeavour would win unregulated extraction rights.62
From the above statement, it is evident that natural resource trade has greatly contributed to
war economies, The study is perplexed at how economic entities operating from conflict zones
are able to carry on with their trade to the extent of making abnormal profitable returns.
American Minefields an MNC operating from the DRC has been a great example of economic
Micheal Ross refers to political economy as to be the politics of natural resource concession,
whereby multinational companies form collusion with combatants either from the rebel groups
or government in purchase for resource areas that have not been captured. The political
economy theory is better placed to explain the paradox in DRC that despite the country having
the largest number of rebel groups the country hosts the biggest number of foreign extractable
industries 85 to be precise. The study would expect that due to the intense and complicated
62
Ibid.
26
web design of conflict in DRC, economic entities should shy away from the region since in
most cases conflict has always acted as a deterrence to trade. The trend is not only seen in DRC
but also in Cambodia, Liberia, Burma, Sierra Leone, Angola and South Sudan whereby in as
much as the conflict has been intense extractable international trade continues to thrive.
The conflict in DRC has linkages to both politics and trade, First Quantum is a Canadian MNC
that has linkages to the former PM of Canada whom on many occasions has acted as a political
advisor to the DRC government but most of all to the MNC. The stated web can, therefore,
allow the study to conclude that the Canadian politician has been acting as an intermediary
To conclude with, extractable trade has greatly contributed to the concept of booty futures
through political economy. That explains why UN has on many occasions resorted to issuing
trade sanctions, trade bans and asset freeze to both MNCs and Political elites with the sole
intent of curtailing war economies. If there was no linkage between trade and politics, then
the global institution would not resort to such subjective and punitive restrictions.
1.7 Hypotheses
1. Conflict Finance by Multinational Corporations and state actors sustain conflict in DRC.
2. The DRC conflict is precipitated by poor governance that is still controlled by western
influence.
3. International Interventions to control Conflict Finance can reduce the proliferation of Rebel
groups in DRC.
27
1.8 Research Methodology
The research design used in this study was qualitative and quantitative research. According to
interpretive modes of inquiry commonly used in social sciences. The Studyhas chosen to use
Qualitative means of exploring and understanding individual views in regards to the concept
of booty futures. The qualitative procedure involves assessingpeople's views and attitudes in a
subjective manner to emerging issues. The primary characteristic of qualitative research is that
it is most suitable for small samples, while its results are not quantifiable . Its essential leverage,
which additionally constitutes its fundamental distinction with quantitative research, is that it
offers an entire portrayal and examination of an exploration subject, without constraining the
The study is basically going to use direct interviews and also hold focus group discussions.
Direct Interviews entailed the interviewer engaging the respondents directly. After collecting
the data the study going analyzed and interpreted the data. Focus group discussions were held
through a non-probability approach since the concept of booty futures is not largely
understood.
It was essential to pilot test the interview guide. This was done to ensure the flow of questions
and the structure of the questions. This was administered to interviewees who didnt participate
in the actual study. The number of interviews to be tested as 5 percent (2) to ensure a good
28
1.8.2 Study Site
The study was conducted in DRC where telephone intervieews were used. This was mainly
because DRC is geographically huge and the areas that experience conflict finance have been
proven difficult to access as the country is still underdeveloped. The study will focus on the
main areas of the Eastern part of Congo which is said to host most of the minerals, this areas
Population refers to the entire collection of aset of objects, people, and events or a collection
of all items that we want to make generalizations or conclusions about. The target population
chosen for this study are 385 respondents. 350 Congolese nationals and 35 academic, security
Sampling is a precise method for choosing an representative fragment of the population being
examined, keeping in mind the end goal to explore. The point of inspecting is to have the
capacity to get data from the chosen population, explore and sum up the finding.63 The study
focused on the nonprobability type of sampling where a little attempt was made to generate a
representative sample. By adopting nonprobability means, the researcher used his judgment
and observation to select individuals and organizations that understand the mechanism well.
The respondents, therefore, must have a background knowledge of the mineral resource
63
Validity refers to the issue of whether an indicator or a number of indicators that is devised to gauge a
concept really measures a concept.
29
conflict in DRC and an understanding of the concept of booty future. The study chose to engage
The Study made use both primary and secondary means of data collection. Primary data was
generated from an original source meaning the data collected will be raw data, from focus
groups discussions and direct interviews. Open-ended interview guide was used to guide the
study during interviews. Secondary data, on the other hand, was collected from existing
The validity and reliability of the data collected can be trusted because the researcher used the
organizational level. Through the use of nonprobability sampling, the researcher targeted
Congolese national living in Kenya mainly working at the DRC Embassy, security experts who
have worked in DRC either in the military or with the United Nations and Organizations that
Given the qualitative nature of ethnographic data generated, the study applied an interpretive
method of analysis. This implies a descriptive discussion of the interview data by foremost
trying to understand and contextualize the narrative from the perspective of respondents.
64
Ibid.
65
Ibid.
30
Consequently, existing relevant theories are applied in the discussion and presentation of data,
but ultimately the conclusions reached in the study are based on the researchers informed
The study seeked consent from the respondents and upheld confidentiality and anonymity of
the respondents. Informed Consent: The respondents were provided with a summary of the key
aspects of the interview prior to commencing the interview. The use of fictional names are
used to ensure the opinions of the respondents are not traceable to them. Anonymity:
Respondents are informed before the interview that they would remain anonymous and any
information they give will be confidential and used only for the purpose of this research. 66
In addition the study did not entice or deceive respondents with an aim of luring them to take
part in the study no gifts nor certification will be offered to the participants. Data was not
manipulated to achieve the desired context of the study. Every data collected was treated with
The study is going to focus on the commercialization of the conflict in DRC. The areas mostly
affected by this phenomenon are the mineral-rich provinces of DRC. The study further focused
on the inlovememt of both state and non state actors in financing the conflict. The time
provided to conduct the research is limited given that DRC as a country is geographically larger
66
Ruhi, B. and Mike, N. Ethical Issues in Research. London: Mark Allen Publishing. The Integrity of
Researchers is paramount.
67
Ibid. p 5.
31
than the European Union. Due to this factors the study will be conducted from Kenya relying
32
1.9 Chapter Outline
Chapter one entails the research proposal giving an Introduction, Background, Research
Problem, Objectives, Research Question, Justification of the Study, Literature Review, Gaps
within Literature Review, Theoretical Framework, Research Methodology and Scope and
Limitation.
Chapter two discussed the history of the war in DRC and the emergence of conflict finance.
Chapter three identified actors who contribute towards conflict finance and how their
Chapter four assessed current and future international policies that can be utilized to leverage
Chapter Five summarizes the study, provides conclusions, and recommendations of the
research.
33
CHAPTER 2
2.1 Introduction
Chapter one, which frames the premise of this research, presented the investigation. It
displayed the announcement of the issue, goals, writing audit and a hypothetical system from
which theories of the investigation are inferred. It likewise takes a gander at the exploration
approach. Chapter two gives a general overview of conflict financing and civil wars in Africa.
Conflict financing is a repeating subject in chronicled chip away at furnished clash (Finley
1985, Lachaux 2000, Howard 1976, Kindleberger 1993). Living of the place that is known for
the vanquished or the zone of travel was a fundamental segment to support and supply armed
forces up until the start of the twentieth century (Finley 1985, 176; Howard 1976, 85, 98).
Wellsprings of financing war included goods, reimbursements, taxes, loans, credits, the
decrease of utilization or the devaluation of outside resources (Finley 1985, 55; Tilly 1992, 85;
Kindleberger 1993, 284). In the sixteenth and seventeenth century, another type of Conflict
Ethnic turmoil and strain are pervasive in today 's world. Daily papers and TV are overflowing
with stories about ethnic viciousness among the general population of Africa, the Middle East,
India, China, Srilanka, Ireland, and so on. Numerous different social orders in little threat of
common wars, for example, the United States, Britain, Canada, the majority of the Western
Europe, and Japan are by the by torn by ethnic strife. From various perspectives they are all
the more genuinely partitioned along ethnic lines, set apart by racial, lingual, religious, and
34
national contrasts, than they were an age back. It has been noticed that vicious clashes far and
wide are progressively in view of ethnic divisions. Just a small extent of wars now happen
between states; by far most are considerate wars with ethnic dimensions.
Africa is the most conflict-ridden region of the World and the main locale in which the quantity
of armed conflicts is on the expansion". Once more, in its 2002 Yearbook, SIPRI expressed
that "Africa kept on being the locale with the best number of contentions". These local conflicts
represent a genuine risk to monetary advancement, particularly for these poor African nations.
Exact works have demonstrated that conflicts can tear down levels of monetary improvement
that took a long time to accomplish. Additionally, for quite a while after their end the turn offs
Comprising the biggest share of ex-colonial states of the world, Africa is caught up in a range
of intra - to inter-state conflicts. Since independence, around 33% of the nations of Africa have
encountered extensive scale political brutality or war. Be that as it may, not every single
African nation are influenced to a similar degree. In some African nations, an entire age has
never experienced peace since independence and has disguised war as a true-blue piece of life.
For example, inside just four decades time (i.e., between the 1960s and the 1990s), around 80
brutal changes in government in the 48 sub Saharan African nations occurred. For some odd
reason, Africa has seen more than seventy coups in the last quarter of the twentieth Century.
Generally, in a similar period, Africa has endured the best number of armed conflicts on the
35
2.3 Causes of Conflict and Civil Wars in Africa
A 1998 UN report on account of the Causes of Conflict and the Promotion of Durable Peace
and Sustainable Development in Africa, is helpful for this postulation. The report exuded from
the worry of the international community about the intensity of armed conflict in Africa. In
spite of the fact that the report does not concentrate solely on civil conflict, it gives an
conflict on the continent; internal and external factors. The report allots the fault to both
exogenous and the inside elements that cause conflict in Africa. The report depicts three routes
First, there are the root causes such as extreme poverty, gross inequalities and weak state
capacities. The root causes have the potential to lead to conflict when they generate deep To
start with, there are the underlying drivers, for example, "outrageous destitution, net
imbalances and powerless state limits." The main drivers can possibly prompt conflict when
they create profound political, social, monetary and social contrasts. Second, there are
empowering factors which incorporate "exclusionary government strategies, outer help for
abusive administrations, and little arms multiplication". The empowering factors in this way
don't cause conflict in essence, yet "compound the underlying drivers or add to a situation that
encourages equipped conflict. Third, there are mobilizing elements, for example, ethnicity,
religion and financial conditions which are used by people or g to instigate brutal activities."
Thus, the causes, enabling and mobilizing factors are on the whole important to cross examine
36
Studies, most strikingly by the Post Conflict Unit at the World Bank, depict wars as driven
basically by financial motivation, especially those conflicts in Africa. Among the Bank's
analytical tools is a data set of conflicts over the period 1960 to 1999 that tries to look at the
danger of civil war. Two lines of thought support this investigation of the connection amongst
war and financial matters: that effortlessly exploitable common assets are utilized to fund civil
wars; and that the propagation of war in certain African nations fills in as an option method for
acquiring wealth. Kieh and Mukenge support the contention that the monetary emergency that
has assail Africa is the aftereffect of the interests of people and outside based multinational
partnerships and business intrigues looking to acquire wealth. They additionally connect these
monetary interests to an entrepreneur framework that is exploitative in nature, without the part
There is a solid connection between conflict financing and civil wars in Africa. In connection
to civil wars, the recognizable proof of potential revenue sources is imperative since they can
give the material bases to the association of conflict and consequently encourage civil wars.
financing or as a financial prize which spurs a few actors to restore armed conflict may
subsequently add to preventing the recurrence of armed conflict and guaranteeing the long haul
practicality of peace building. Among the key strategies for conflict financing are centralized
war economies, struggle products, outer help and resource exchanges from regular people.
Different techniques incorporate the printing and forging of cash, protection rackets, landing
fees, kidnapping and revenue from portfolio investments and true blue business wanders. The
37
2.4.1 Conflict Goods and Civil Wars in Africa
With declining help from foreign supporters, rebel groups and governments in Africa have
depended progressively on the commercialization of the assets under their control. Conflict
merchandise are tradable items that start in regions controlled by a sorted out equipped
gathering and that are sold or traded on worldwide markets with the aim to fund the start,
support or propagation of armed conflict (Cooper 2001; Cooper 2002). The civil argument on
'conflict diamonds' conveyed expanding regard for the issue of contention merchandise. The
connection between the abhorrence of war and precious stones as an image of adoration and
time everlasting was taken up in crusades from non-administrative association, for example,
Global Witness (1998, 2000), Amnesty International, or Partnership Africa Canada (Smillie et
al 2000), and was broadly bantered in the print media.various investigative reports by the
United Nations Security Council recorded in awesome detail the connection among diamonds
and the financing of war in Angola, Sierra Leone and the DRC (UNSC, 2000, 2000, 2001).
Nonetheless, diamonds are by a long shot not by any means the only conflict good. The
incomes from oil are a noteworthy source in the conflicts in Sudan, Angola, Algeria, Nigeria
and Morocco (Western Sahara) (Amnesty International 2000, Christian Aid 2001, Cilliers and
Dietrich 2000, Global Witness 1999, Le Billon 2001, ICG 2001, Essential Action and Global
Exchange 2000, Nugent 2001, Afrol News 2002). Timber is an imperative wellspring of
income in Liberia, Cambodia, and for some armed groups in the DRC (Global Witness 2000,
2001a, UNSC 2001). Drugs are key to the wars in Africa (UNDCP 2001a, Economist 2001a,
2001b). Copper, cobalt, gold, coltan, espresso, niobium, and cassiterite are asset which helped
38
Conflict products have moved toward becoming instruments for financing conflict in different
ways. The first is the immediate inclusion of organized armed group in the commercialization
of an assets. This has been the situation in Angola with diamonds and oil. UNITA is said to
have made between USD 3-4 billion in the vicinity of 1992 and 2000. On the opposite side,
the administration was vigorously engaged in the exploitation of petrol in collaboration with
Western petrol companies (Le Billon 2001, 62, 69; Cilliers and Dietrich 2000). In the DRC
different farmed groups have been associated with the exploitation of copper, cobalt,
diamonds, gold, coltan, coffee, timber, niobium and cassiterite (UNSC 2001).
Futures contract is another device to finance conflict through common assets. These purported
booty futures allude to "the deal or exchange of future rights to normal assets that are not
yet under the vender's control assets that the dealer would like to catch in battle" (Ross 2005).
This methodology of raising support has been utilized as a part of the Congo Republic, Sierra
Leone, Angola, the Democratic Republic of Congo, Liberia and Equatorial Guinea. Generally
speaking, booty futures support weaker dissident gatherings to cover their start-up financing
or government powers which are on the verge of defeat. Along these lines, futures contract can
importantly affect the start and propagation of conflict since they immediate revenues in the
The majority of the previously mentioned strategies for conflict financing in Africa are
established in the control over an area and are consequently household wellsprings of
financing. Notwithstanding, the vast majority of these local sources can't be marketed without
the association of foreign actors. This partnership depends on business interests, profiteering
39
or political points and is related with governments, Diasporas, helpful associations and outside
organizations. While as a rule Diasporas are a source for good, individuals members from
Diaspora can be an effective power that supports and energizes conflicts at times. Diasporas
regularly sustain a romanticized connection to their nation of inception. The material and
budgetary help of diasporas has a tendency to be all the more ideologically and politically
extraordinary in light of the fact that they don't straightforwardly encounter the impacts of
political shakiness and armed conflict(Collier et al 2003). Cases of such Diasporas incorporate
the Lebanese Diaspora in West Africa which bolstered the Amal Militia in the Lebanese
common war and the Tamil Diaspora in Western Europe and Canada (Angoustures and Pascal
In any case, the part of diaspora remittances in financing conflict must be qualified. the
disposition of diasporas towards their country contrasts from group to group contingent upon
the conditions under which migration occurred, the relative size of the diaspora, the geographic
focus, its financial status and the citizenship arrangements of the host state. Besides, diaspora
settlements can ambivalently affect opportunity structures relying upon who controls them
(Ballentine 2003).
Humanitarian organizations can likewise add to conflict financing if the conveyance of help is
saddled by those controlling a region or if the merchandise gave are just stolen and after that
profitable resource. Warlords and those responsible for struggle may utilize helpful guide to
supply their supporters to the detriment of the foe. They may likewise basically take
nourishment help, covers, tents, correspondence gear and autos and utilize it for their military
destinations (Anderson 1999, 39). In view of the control of an area and populaces, sorted out
40
equipped gatherings can produce income by asking for an entrance expense from helpful
associations. Besides, sorted out furnished gatherings may profits by the nearness of
worldwide acknowledgment and encourage access to assets (Rufin 1996, 29). In general,aid
has added to drawing out equipped conflict by enhancing warlords, polarizing existing foes,
contorting nearby economies, and having distributional effects. This prompted a call to
reevaluate the arrangement of help to conflict areas with the minimum conceivable level of
Organizations infuse outer financing by working together in zones of contentions. This may
incorporate bribing governments or Warlords to abuse assets or access markets. This may
likewise infer paying for security by getting a private military organization or rebel group to
secure a region of misuse. Organizations work in a focused market and the loss of a critical
region of present or future abuse may block their capacity to go into the market after a
contention closes while rivals with less compunctions can enhance their market position. At
the point when De Beers withdrew from Angola in 1999 in dread of a consumer backlash after
the conflict diamond debate, its rival Lev Leviev entered the market. This move gave Lev
Leviev imminent control over Angola's diamond reverses which had been evaluated to be 10%
of diamond reserves and valued at USD 800 million Parker et al 2000; Roche 2001).
The dynamic idea of conflict financing has been stressed in the changes of contention
economies after the Cold War from support to self-financing procedures. In any case, the
broadly acknowledged claim that common assets supplanted declining support from Cold War
41
benefactors ought to be qualified in various ways. Support installments amid the Cold War had
wonder. Western forces were more associated with supporting guerrilla developments in
contrast with the Soviet Union and China (Naylor 2002, 80-81). Additionally, notwithstanding
amid the Cold War, guerrilla bunches could depend to some degree on normal asset extraction
and the tax collection and in addition the operation of financial movement. Illustrations
incorporate guerrilla bunches in Lebanon, the Philippines, Burma, Cambodia and Angola
(Ibid., 58, 65-70; Picard 1996, 76-84; Dietrich 2000c, 276; Le Billon 2001, 6). Besides, it is
misdirecting to expect that outsider help ceased after the Cold War as the common war Bosnia
and Herzegovina shows (Bojicic and Kaldor 1997, 141, 159; Kaldor 1999, 33, 46-48).
On the multilateral level, the issue of natural resources picked up prominence through the
definite reports of the United Nations Security Council Sanctions Monitoring Mechanism on
Angola, the Democratic Republic of the Congo (DRC) and Sierra Leone (UNSC 2003, 2002a,
2002b, 2001a, 2001c, 2001d, 2001e, 2000a, 2000b, 2000c). Especially the part of purported
"conflict diamonds" in the financing of African Conflicts turned into a focal component in
Kimberley Process. Nongovernmental associations (NGOs) played a main part to make weight
on business and governments by uncovering the connection amongst diamonds and armed
conflict in Angola and Sierra Leone. The NGO battle changed the diamonds industry's
response from denial to engagements and added to a substantially harder treatment of conflict
jewels in the United Nations Security Council. Be that as it may, once the connection was
uncovered, the multi partner coalition which arranged the Kimberley Process Certification
42
As far as peacemaking, basic voices contended that the Kimberley Process was a piece of
factional way to deal with change the contention progression is the nations worried by
debilitating the weaker and fortify the more grounded combative: the almost exclusive focus
of some policy makers on curtailing the smuggling of diamonds in Sierra Leone and Angola
has allowed attention to be diverted from the fact that demanding such sanctions is an implicit
call for the military defeat of the rebels by the government. As calls for military victory appear
to be politically incorrect in the current age, the vocabulary of victory and defeat has been
transferred to the more neutral and technocratic language of sanctions and restraints on the
Angola is a nation favored with abundant natural resources. Specifically, the abundance of
high quality oil and diamonds drew the world's most intense foreign companies to its shores,
amid the war and after. Angola is the second biggest producer of oil in sub-Saharan Africa,
after Nigeria and the producer turned into a member of the Organization of Petroleum
Exporting Countries (OPEC) in 2007. The mineral abundance of Angola implied that the
nation was imperative to governments and business organizations alike. Victor Luvhengo
states that, expansive oil multinational companies (MNCs, for example, EXXO Mobil, Royal
Dutch, Sell, Chevron and the British Petroleum, among others worked in Angola from 1955
Angola has encountered armed conflict since the resistance against colonial Portugal in 1961.
Armed conflict proceeded past freedom in 1975 between the primary fiberation movements
and transformed into a Cold War intermediary struggle of the superpowers, opposing the
43
Movimento Popular de Libertaao de Angola (MPLA) and Unio Nacional Para an
Independncia Total de Angola (UNITA). With the end of the Cold War, there was trust that
Angola would profit by a peace dividend following three many years of armed conflict. Be that
as it may, this expectation was slippery as the threat between the two belligerents and their
mission to control the state, what took after was one more decade of armed conflict. Conflict
recurrence in Angola grievously features the results of restored furnished clash and the failure
of peace processes. The recharging of contention in 1992 cost no less than 300,000 killings
about again the quantity of individuals who lost their lives since 1975 (Hodges 2001, 15). In
this way, rather than benefiting of its economic potentials including oil and precious stones,
prolific horticultural terrains, and rich fish stocks, the general population of Angola were once
more drawn into armed conflict and saw Angola's wealth disperse.
The control over oil resources has been a vital resource for MPLA to fund its operation and
govern Angola. The way that about the majority of Angola's oil stores are seaward has made
oil assets practically identical to a monetary asylum (Le Billon 2005). Oil production and
export could could be detached from assaults amid the civil war; with the exception of in late
1992, when UNITA assault on an on-shore oil establishment (Clarke 2000). This key area may
have given the MPLA the preferred standpoint over UNITA as diamonds were scattered over
a substantial area in focal and North-eastern Angola. While UNITA was at first ready to exploit
diamonds effectively with diamonds diggers and the supposed garimpeiros could even
somewhat move to semi-industrial exploitation in the mid-1990s, not having the capacity to
control the precious diamond against MPLA propels traded off the capacity of UNITA to fund
44
Moreover, Luvhengo's research demonstrates that the South African based Debeers diamond
mining organization likewise worked in Angola and in help of the UNITA. A Report of EFF
demonstrates that UNITA was bolstered particularly by the United States, United Kingdom
and France while the administration was upheld by Cuba and the USSR/Russia. Belgium,
South Africa and Germany are additionally refered to among nations that interceded in the war
in help of UNITA. As indicated by the report, access to diamond regions and the deals thereof,
assisted the revolutionary development with attracting foreign governments and business
organizations also. Truth be told what had showed up as conflict of free enterprise and
A focal dynamic of conflict in Angola has been credited to the two gatherings having had an
autonomous wellspring of financing through oil and diamonds. Accordingly, activities to end
the contention have been caught in a security situation: "Since the Angolan belligerents have
minimal normal reason or ground whereupon to construct a steady peace, doubt the worldwide
group, and have implies through oil and precious stones to arraign war, the two sides have a
solid motivating force to look for determination through a military thrashing of the other.
Components inside the administration and UNITA may trust that closure the war would be in
their own best advantage, however without a sound outside or joint organization to ensure
recognition once battling stops, the motivating force to hold a remaining war-battling limit is
Conflict financing and civil war left most of the Angolan individuals under contemptible
destitution in a place that was known for bounty. When war finished in Angola, no less than
68 percent of the general population lived under the poverty line. The assimilados who were
for the most part connected with MPLA had access to better training, education and wealth of
45
Angola, while the indegenas related with UNITA and who additionally dwarfed the
assimilados were packed in country ranges with little access to education, health facilities and
the wealth of Angola. This added to the compounding of civil war in Angola, as the indegenas
individuals who were for the most part poor proceeded with the battle against the assimilados
commanded government. In this way, amid the war, the lion's share of individuals needed
essential needs and were jobless which no doubt incensed them for the administration couldn't
satisfy their necessities. Truth be told, while Angola gives off an impression of being
advancing in the range administration and keeping in mind that the economy has altogether
developed since the war, the nation is as yet attempting to show commitment to its people.
Angola is still among the the least developed nations in the world and poverty gap is still wide.
The principal settlers of Monrovia, known as Americo-Liberians, who were liberated slaves
from the United States landed in Monrovia in the vicinity of 1829 and 1835. At the point when
the pioneers touched base in Liberia there were at that point indigenous populations, for
example, the Mel speakers (Gola and Kis); Kwa speakers (Basa, Belle, Dei, Grebo, Krahn and
Kru); and Mende speakers (Bandi, Dahn, Kpelle,Loma, Mandingo, Mano and Mande).2 Upon
landing of the Americo-Liberians, the American Colonization Society (ACS) assumed control
over the representing of the domain and utilized the American Constitution to run region. The
Americo-Liberians effectively arranged out of the American domain. Along these lines, in
1847, Liberia was set up as a Republic under the leader of the True Whig Party (TWP) drove
American law was embraced. TWP as a political gathering of the Americo-Liberians would
command Liberian governmental issues until 1980. The time in which the TWP overwhelmed,
46
1847 to 1980, was a period amid which the indigenous individuals of Liberia were persecuted
Having organized themselves, indigenous people of Liberia began their offensive against the
Americo-Liberian and turned against each other. The 14 year civil war left between 150 000 -
200 000 people, mostly civilians, dead and at least 1 million refugees in neighboring
countries.6 A breakaway movement from NPLF, the Independent Patriotic Front for Liberia
(INPLF), led by Prince Johnson emerged in 1990 and eventually assassinated Samuel Doe in
September 1990. An Interim Government of National Unity (IGNU) led by Dr. Amos Sawyer
was established through negotiations by the Economic Community of West African States
(ECOWAS). A Cease-fire Monitoring Group (ECOMOG) was also established to keep peace
Despite efforts made by ECOWAS and the international community, including an arms
embargo imposed by the Security Council in 1992 and the appointment of a Special
eventually won 75 percent of the votes in the 1997 general elections in which 13 parties
participated. Taylors regime, however, became the most brutal in Liberias history. Unable to
tolerate Taylors regime, the people of Liberia led by Liberia United for Reconciliation and
Democracy (LURD), later the Movement for Democracy in Liberia (MODEL), escorted to
armed resistance.
According to Report on the Poverty Eradication Strategy for Liberia, the political power,
infrastructure and basic services were concentrated in Monrovia, and there was marginalization
of youth and women. Mismanagement of national resources was widespread and this situation
contributed to stark inequalities in the distribution of the countrys wealth. The over-
47
concentration of power in the hands of a few bred corruption and decision making was
restricted to the few. Civil society participation was extremely limited which no doubt
undermined good governance. Successive governments however failed to correct the ills of
Throughout the history of Liberia and up to the end of the civil war, evidence adequately shows
the unbalanced distribution of the countrys diamond wealth. The very poor governance and
undemocratic state of Liberia, greed, and unemployment meant basic needs of the majority
remained unmet by the political leadership. Americano Africanos were wealthy and
dominating decision-making while the majority of the people of Liberia remained under abject
before, the Doe and Taylor regimes maintained the status quo and continued to deprive the
people of Liberia. The war in Liberia was also a struggle by those who were under abject
poverty. Those desperate for change and those who felt deprived, would find no reason to
The Liberian war demonstrates clear linkages between natural resources and foreign economic
interests. The interests of several countries and nationalities from within and without Africa
are conspicuous in every front. In particular, the United States, Sweden and Lebanese traders
were largely motivated by economic and business interests in rubber and oil ore. According to
Ali and Matthews, at the height of the war, when Taylor controlled the bulk of the country
there was a thriving export trade in diamond, timber, gold and agricultural products, made
possible through a network of foreign firms. They add that, Canadian, British, Japanese and
French companies continued business with Liberia at the height of the civil war. It is important
48
to mention also that Monrovia served as the centre where diamond smugglers met or waited
for the blood diamond emanating from Sierra Leones Revolutionary United Front (RUF).
The international trade centre in Antwerp, Belgium readily accepted RUF diamonds which
were being shipped from Monrovia. These were blood diamonds emanating from Liberias
war-torn neighbor, Sierra Leone. As a result of availability of markets for blood diamonds,
which provided much finance for Taylor to maintain a luxurious and opulent life, it became
crucial for him to cling to power and to control the diamond industry both in Liberia and in
Sierra Leone. It was against this backdrop that Taylor had to maintain ties with and support
the RUFs brutality in Sierra Leone. Sierra Leones RUF no doubt fed Taylors appetite for
Following international pressure to end impunity in Liberia, Charles Taylor eventually gave in
and resigned from his presidential seat in August 2003. At the time of his resignation, Taylor
had also been indicted by the Special Court for Sierra Leone which had been set up by the
Government of Sierra Leone in conjunction with the United Nations. The Special Court was
mandated to bring to trial, the perpetrators of atrocities committed against the people of Sierra
Leone between 1996 and 1999. Taylors resignation gave way to a successful cease fire
agreement.
Thus a Peace Agreement between the Government of Liberia (GOL), The Liberians United for
Reconciliation and Democracy (LURD), The Movement for Democracy in Liberia (MODEL)
and the Political Parties was concluded in August 2003. The agreement was negotiated in
Ghana, as an initiative of the Economic Community for West African States (ECOWAS). The
agreement aimed to amicably settle the crisis which had plundered Liberia for many years.
Specifically, the parties agreed to create a stable political environment and to promote
49
democracy, good governance and the rule of law for sustainable development of the people of
Liberia and most importantly to establish an interim government which will lead in the creation
Subsequent to the ceasefire agreement, in September 2003, the United Nations Security
Council established a United Nations Peace Keeping Mission in Liberia (UNMIL) in order to
monitor the implementation of the ceasefire agreement. The agreement and the establishment
of UNMIL paved the way for democratic elections that left current President Ellen Johnson-
Sirleaf at the helm of power in 2005. In 2012, Taylor was slapped with a 50-year jail sentence
specifically for aiding the RUF rebels and the Armed Forces Revolutionary Council in Sierra
Leone.
2.5.3 Conflict Financing and Civil War in Sierra Leone Civil War
Sierra Leone was first established as a settlement for freed slaves in 1787 and became Africas
first model state. In 1896 the country was declared a British protectorate. With a population of
slightly below six million inhabitants dominated by the Temne in the north and the Mende in
the South, Sierra Leone has huge deposits of valuable diamonds and other natural resources
such as gold and timber. The country became independent in April 1961 under its first
President Milton Margia of the Sierra Leone People's Party (SLLP). Various authors on the
subject of the Sierra Leone civil war provide a picture of a successful Sierra Leone in the 1960s.
According to Shola Omotola Sierra Leone had an independent and progressive civil service,
judiciary and the military. Prior to and after independence, roads, clinics and hospitals and new
schools were built. The first ever university in the sub-Saharan region was Forrah Bay located
in Freetown, the capital of Sierra Leone. Ndumbe supports this by stating that until 1970, Sierra
50
Leone had one of the best public-sector structures with professionally trained public sector
employees.
The excessive inequalities in Sierra Leone were a recipe for civil unrest and grievances. The
peasantry class who were most affected by the state of affairs in Sierra Leone found it fit to
join the RUF. And, indeed, the brutality displayed by RUF militants was hugely supported by
the frustrated masses who were poverty stricken and resented successive corrupt regimes. Greg
Campbell, for example, argues that RUF began as a movement of peasants who were obviously
distressed about the inequalities that existed in Sierra Leone at the time. The assertion by
Campbell correlates with the findings of David Keen who argues that social exclusion of
citizens has the potential to negatively impact the values and emotions of populations.
Indeed, Ibrahim Abdullah confirms that RUF recruited from the vulnerable lumpens and
juveniles to whom their bush paths to destruction appeared more appealing. Furthermore,
when Stephens decided to bring the mining industry under one organization and required the
cleanup of smuggling in the mining fields, the miners who in most cases were the youth lost
their wages and began to feel deprived of basic needs poverty. The economy also plummeted
resulting in lower salaries which led the educated, including teachers across the country to
leave the work place and become idle. Quoting Fouke Mpoyo, Conteh-Morgan highlights that
many Sierra Leoneans believe that unemployment caused many hardships that later produced
rebellion and exacerbated it as well, as there was no creation of jobs or economic improvements
during the course of the war; further, there was no food and there was massive unemployment
Diamonds were discovered in Sierra Leone in 1930 in the Eastern Kono district and by 1970s,
half of the output was exported illegally. The alluvial diamonds of Sierra Leone are on the
51
surface and not entrenched in kimberlite. As such, they are easily accessible without requiring
sophisticated and expensive technology to mine them. It is evident that Stephens had a desire
to control the diamond mining for personal gains and this brought Sierra Leone to its knees.
His creation of a National Diamond Company under his office as Prime Minister and his
entrusting of the company to his trusted friend, Lebanese businessman Jamil Mohammed
complicated matters for the country as the duo pushed for their personal business interests.
Stevens successor Joseph Momoh worsened the situation further as he gave Mohammed even
more powers over the mining sector, a move which indeed undermined the Sierra Leone
people.
It was during this period of excessive corruption and mismanagement in the diamond mining
in Sierra Leone that the people of Sierra Leone ended up in what came to be viewed in many
quarters as the diamond war. The accounts of Davies show that Sierra Leone produced 2
million carats between 1960 and 1970 and that during that time at least half of the diamond
output was exported illegally. Ndumbes work correlates with the findings of Davies,
indicating that by the 1970s, legal trade in diamonds dropped from 2 million carats to 595 000
Davies further postulates that the exploitation policies by the successive regimes encouraged
crime the illicit mining and smuggling which resulted in the emergence of desperate miners
known as the san-san boys. Ndumbe expresses similar sentiments to Davies statement that
precipitated the acrimony in the country as a race for access to diamonds by officials, rebel
groups and business people with malice became evident through the 1970s to the early 2000s
52
There are allegations that the RUF field commander General Mosquito joined the rebellion
expecting to access diamonds.16 To buttress the extent of diamond influence in the countrys
civil war Richards alleges that following the ECOMOG intervention in the civil war in 1998
the three main factions, CDF, AFRC and RUF fought using between 60000 and 80 000
of the small population of about 4.5 million at the time. While Richards is not explicitly
convinced by assertions of some writers about the tremendous influence of the diamonds in
the civil war in Sierra Leone, his findings are useful as they provide much information on the
role of diamonds in the Sierra Leone civil war. For example he asserts that diamond mining
helped to fund a rapid expansion of the CDF rebel movement which accordingly grew from a
Both writers provide an indication that RUF illegally exported diamonds worth between $20
60 million per annum, although Richards suggests that the amount is insignificant. It is
necessary to point out that that the assessment of whether or not this amount is significant is
relative and depends on where one stands. For an African movement where there is lack and
famine and deprivation, this no doubt is a significant amount. And, for a rebel who did not
have a salary or was underpaid, being paid for smuggling diamonds would become a necessity.
Davies further confirms that diamonds produced a war prolonging congruence of interests
among the belligerents such that they at times mined peaceably side by side and attacked
civilians with the intent of keeping them away from the lucrative industry.
During the civil war diamonds sold in the black market emanating from RUF made up
approximately ten percent of legitimate diamonds. Though illegitimate, they entered the
market disguised as Liberian and Guinean. To state the obvious, illicit diamonds are cheaper
53
and for both local and foreign businesses this cheaper and lucrative market becomes necessary
for large profits. The corrupt officials, rebels and ordinary business people were all interested
in having a share of the cheaper product which frustrated any hope for peace. Richards informs
of a memo by the first General of the UN Peace Keeping operation in Sierra Leone who wrote
complaining about the conduct of some ECOMOG generals who also had a hand in the illicit
diamond trading and were as such bribed by Sankoh to support his interest in standing for
presidential elections.
The fact that the Memo did not reach the UN and ended only as a draft may not necessarily
mean that it was not true. In the practice of diplomacy the general could have been constrained
by the political consequences of his statements. What is important is that such allegations
reveal the possibilities that peace keepers may at times be not as honest as one may wish,
therefore requiring much scrutiny if indeed civil strife is to be truly ended. We have seen other
forms of abuses by some members of peace-keeping forces in some parts of Africa including
in the DRC.
All these factors plus the instabilities in Sierra Leone made the diamond industry more
lucrative and attracted corrupt officials and rebels as well as foreign firms alike to engage in
the illicit trade. The assertions of both Davies and Richards suggest that without the booming
illegal business in diamonds, the rebel movements would probably have been weaker without
support from those interested in the illicit trafficking of diamonds. Thus the ferocious appetite
for the alluvial diamonds knew no boundaries as those involved would prefer the status quo in
The TRC report further asserts that there were unilateral interventions by the governments of
Nigeria, Liberia, Guinea, Burkina Faso, Libya, Ivory Coast and the United Kingdom the former
54
colony which had intervened for various reasons. There were also mercenaries and business
foreign firms that became entangled in the Sierra Leone civil war. At the height of the war
diamond customers in the form of foreign firms such as those from Australia, Switzerland, Tel
Aviv, United States, and Ukraine kept the ar going. The availability of foreign customers who
also bought diamonds in foreign currency was an incentive for a continued war.
The involvement of Charles Taylor of Liberia in the civil war in Sierra Leone deserves mention
when one considers the impact of external involvement in the civil war in Sierra Leone. Charles
Taylor had two primary motives in Sierra Leone, which were to retaliate against the Momoh
regime for supporting the 1990 ECOMOG intervention in Liberia and secondly, indeed, the
desire to obtain diamond resources to finance his insurgency and pay off his supporters against
Liberian President, Samuel Doe. It was actually with the help of Charles Taylor of Liberia that
RUF invaded Sierra Leone and launched attacks against the government. It was through Taylor
that RUF was able to sell its blood diamonds using Liberia as transit country. In turn the profits
provided the RUF with the opportunity to purchase arms and ammunitions on the black market
During the Sierra Leone civil war, the controls and regulations for the diamond trade were lax.
The Diamond High Council in Antwerp used to record the origins of diamond imports as the
last country to ship the goods meaning that the RUF diamonds shipped from Monrovia were
falsely identified as originating from Liberia and as such were imported into the legitimate
markets of Antwerp in Belgium, Israel and Ukraine among others. It was this loophole which
ensured profits for Charles Taylor's Liberia and RUF and in this regard prolonged the war.
Campbell argues that the loophole was deliberately crafted for business reasons. In 2000, a
55
Canadian based NGO blamed the Belgian industry for deliberately attracting organized crime
This NGO initiative marked the beginning of an international campaign against blood
diamonds. The campaign led to the creation of the Kimberly Process Certification Scheme a
voluntary process in which rough diamonds are certified to distinguish legal ones from those
that are illicit. As a result of the continued demand for Sierra Leones illicit diamonds in
Antwerp and other countries, in 2000 the United Nations Security Council unanimously
Leone's rough diamonds and instructed Antwerp to identify legitimate diamonds by the place
where they are mined. The resolution also requested the International Diamond Manufacturers
Association, the World Federation of Diamond Bourses and the Diamond High Council to
2.6 Summary
This Chapter elaborated the conceptual framework of the relationship between conflict
financing and civil wars. The chapter relates the material environment to organize armed
conflict and the incentives of using armed force to each other. The material environment is
defined by the availability of revenue sources to pay for the organisation of armed conflict and
the cost to start and maintain armed conflict. In elaborating the material environment, the
Chapter developed a comprehensive approach to conflict financing and a tool to estimate the
cost of conflict. The incentive to using armed force is defined by the expected future benefits
and opportunity costs of using armed force. The consideration of the propensity of conflict
renewal of various actors leads to the high or low risk of conflict recurrence.
56
CHAPTER THREE
3.1 Introduction
The natural resource conflict in DRC is a peculiar one since the variables contributing to the
conflict have greatly been believed to be emanating from both internal and external variables
ranging from state to non-state actors. This chapter, therefore, wants to identify the various
variables that contribute to conflict finance in DRC. Focus was emphasised on the political
economy theory to bring out the true reflection and picture of DRCs centralized war
economy.68 Despite the perennial natural resource conflict in DRC, primary commodity export
for minerals has increased. In Colliers words natural resources help to finance conflict and
Before the study delves deeper into state actors roles and impacts in conflict finance it is
important to be cognizant of the fact that states can be crucial in organizing and supporting
activities that violate their own laws and international law to fulfill both their economic and
violate domestic, international and human rights law, that can be perpetuated through a
Multilateral basis, Bilateral or even unilateral depending on the states political, economic, and
ideological interest.
68
William, T. (2007). Governments and Politics in Africa. P.9 the emergence of states failure can be linked to
resource distribution precipitated either by internal or external insurgencies that are fighting for natural resource
control.
69
Chambliss, W. (2000). State Crimes of Minerals Congo.
57
According to Micheal Ross, through his empirical findings, there is an indication that between
the years 1989 2004 five African governments used the sale of booty futures when they were
on the verge of losing their sovereignty to insurgents. Further findings indicate that the sale
was conducted amongst sovereign states through the signing of concessions in exchange for
Mobutus ouster in 1996 provides the best case study of the role of governments in the sale of
booty futures. Laurent Kabila then, a warlord planned to ouster the existing regime and he
sought the support of his neighbors Rwanda and Uganda who became very instrumental in
Mobutus ouster.70 Laurents interaction and call for support from Rwanda and Uganda as a
rebel leader were a clear indication that the two neighbors were keen at destabilizing a
sovereign state, not because of poor relations between the states but because of selfish state
As mentioned in the previous chapter according to the representative from the Embassy of
Congo the major rebel groups in Congo, FDLR, MaiMai, and M23 are said to be composed of
Rwandese citizenry since nearly all speak Kinyarwanda, a linguistical dialect that does not
originate from DRC. The former M23 leader Bosco Ntanganda also commonly referred to as
Terminator speaks fluent Kinyarwanda his primordial features also indicate that he is a Tutsi
since he is tall and has a Caucasian look, a common feature among the Rwandese. The big
question is why have this Rwandese rebel groups been able to hold DRC a country bigger than
the European Union hostage for many years in conflict? The arguments are that Kabila whose
70
Edward, G & Materson, T. (2002). Governance Quality and Governments Commitment. p.45. The Fragile
Peace.
71
Wennmann, A. (2017). Political Economy of Conflict Financing, they operate in a structural environment
of weak states, willing collaborators and shadow economies
58
origin is questionable has allowed this rebels to remain powerful enough to cause continuous
instability in DRC by financing and motivating conflict to enable him and his cronies to loot
President Sassou Nguesso of Congo Brazzaville has made frantic efforts to try and bring
to resolve the DRC conflict but his efforts received less attention from his peers. The
International Regional on
Great Lakes Region (ICGLR) and the East African Community (EAC) have also tried to
persuade the three leaders to critically evaluate conflict finance in DRC and abide by the
Rwanda and Uganda have however defended themselves that their entry into DRC should not
be viewed as an incursion but as an intervention for the restoration of peace and security among
the Congolese, commonly known as the Banyamulenge and Hutu refugees in DRC whom have
constantly had a friction and to sum it all for the better good of the East African Region. The
latter is not the case since, upon their involvement in the conflict, financial institutions like
World Bank and International Monetary Fund re-evaluated these two countries stock
exchange markets and realized that they had grown instead of going under due to their
59
3.2.1 Rwanda Involvement in Conflict Finance
According to the U.N. expert panel report traders in Rwanda have been funding a rebellion in
the resource-rich area of Eastern Congo so as to profit from tin, tungsten and tantalum which
are smuggled across the border from mines in eastern Democratic Republic of Congo.
The confidential report, added that while Congolese government requirements subjected
exporters to ensure minerals are conflict-free and halted nearly all trade from the countrys
east, smuggling into Rwanda and Burundi had increased. Impoverished Congo sits on large
reserves of gold and the minerals used in electronics production and according to a Chatham
House study an estimated 10 million people are directly or indirectly dependent on the mining
industry.72
M23 rebels commanded by warlord Bosco Ntaganda, wanted by the International Criminal
Court for war crimes, have been fighting government soldiers in eastern Congos North Kivu.
The credibility of the mineral tagging system in place in Rwanda is jeopardized by the
laundering of Congolese minerals, as tags are routinely sold, the report said of the practice to
bag and tag products at the mine to certify their origins was not effective. Several traders
have contributed to finance M23 rebels out of profits resulting from smuggling Congolese
minerals into Rwanda, the report added, adding that Rwandan exports of tantalum and
A recent study by nonprofit rights group the Enough Project, cited that Rwandan government
data, found that from 2010 to 2011 Rwandas mineral exports jumped 62 percent compared
72
https://www.reuters.com/article/us-congo-democratic-rwanda-minerals/exclusive-mineral-traders-in-rwanda-
helping-fund-congo-rebels-u-n-panel-idUSBRE89F1M320121016
73
Ibid
60
with a 22 percent rise in domestic mining production.74 The East African paper reported in
March 2013 that Rwandan export volumes and value from minerals had improved since private
investors bought all the 21 mines in the country, with the last privatization deal sealed in 2007.
Combined, the country produces between 8,000 and 9,000 tonnes of minerals a year, with tin
being the major export mineral. In addition the country earned $136.6 million (over Rwf87
billion) from mineral exports in 2012. However, it targets $409 million (about Rwf261 million)
by 2017.75
This will position Rwandas mineral revenues ahead of tourism, which is currently the leading
foreign exchange earner. Tourism fetched Rwanda $281.8 million (over Rwf180 billion) last
year, accounting for 8.4 per cent of total export earnings.76 The numbers are commendable
especially for a country that has struggled economically, however many have questioned the
origin of the minerals that is growing Rwandas economy at such a high speed. The East
African reports that the Rwandese government have been making efforts to prove to the world
that it also has gold, tin, tantalum and tantalite like the Democratic Republic of Congo (DRC).
Unfortunately, that proof is yet to surface in the meantime it is safe to assume that the country
According to the representative from the Embassy of Congo recent intelligence by the
Congoleses government discovered that Rwanda was constructing an airport at the North Kivu
border. In his opinion Rwanda, Uganda and the several multinational companies have colluded
74
Ibid
75
http://www.theeastafrican.co.ke/news/Rwanda-puts-three-mines-on-the-block/2558-1728570-
13gksvyz/index.html
76
http://www.rse.rw/uploaded_reports/Rwanda_Stock_Exchange_final1.pdf
77
Ibid
61
to smuggle minerals from DRC and the airport being built will serve that function.78 The
representative from UNEP added that it was difficult to pin point the multinational companies
working in DRC because the people on the ground are what he termed as shadow companies
who were not registered and to find their origin was a toll order.79 A report by UNEP and
MONUSCO also noted that there were many charter planes coming in and out of DRC and
since charter planes do not have the capacity to fly long distance it was assumed that they
stopped over either Rwanda or Uganda so as to refine the mineral. He further added that it is
in this countries that the mineral is legalized and most international companies use this as a
To provide further proof, tantalum is smuggled from Rubaya via Goma and eventually, finds
itself in Rwanda where its then legalized and certified as official Rwandan commodity ready
for foreign exportation. UNEP figures indicate that Rwanda, Burundi, and Uganda receive a
total of 60-71% of DRC mineral. The smuggling is done by small trucks near Goma to
facilitate border crossing at the watch and protection of rebel groups with some corrupt
government officials who authorize the certification. Kenya has also been accused of
smuggling timber which is done via Uganda from the eastern part of DRC along the border
78
Interview, Embassy of Congo Representative.
79
UNEP Country Representative
80
UNEP-MONUSCO Report April 2015
62
3.2.2 Uganda Involvement in Conflict Finance
Ugandas invasion of DRC dates as far back as 30years ago. In those days Uganda was one of
the poorest countries in Africa today Uganda is slowly growing to be a middle class economy.
It is also believed that Uganda is the number one exporter of Gold from DRC. Uganda and
Rwanda represent realists views of state centrism. They have upheld this theory to its highest
regard and have ensured that they reap maximum benefits despite the plunder they leave
behind.
The representative from Great lakes added that Ugandas involvement in DRC is not only state
based. There are many individuals who have been linked to directly fund rebels in gold rich
areas. General Saleh who is related President Museveni apparently has been linked to massive
mineral exploitation in DRC. In the UN panel of experts report Mr. Salehs name was
mentioned as among the people the panel recommended several restrictions including travel,
It may seem as if there is no light at the end of the tunnel in the case for DRC, but a recent
ruling by the ICJ for Uganda to pay punitive damages for the five-year occupation of its eastern
regions shows that international law is not a toothless dog- assuming that Uganda actually
pays. The UN's highest judicial body ruling that Uganda's 1998-2003 intervention violated
international sovereignty and led crimes against humanity, brought a sense of relief for DRC
even though Uganda expressed dissatisfaction with the ruling. Kampala government officials
claims that it acted in self-defense was dismissed in a sweeping ruling which piled fresh
63
The court upheld Congo's claim that it had been the victim of unlawful military intervention,
though it did not find a deliberate policy of terror. Kinshasa welcomed the ruling and said it
would seek $6-$10bn (3.4-5.6bn) in compensation, an estimate the court said would be
appropriate. A The Court noted that the UN report in 2001 found that Burundi, Rwanda and
Uganda intervened to secure their borders but later the plunder of resources became a reason
to stay. DRC was very pleased with the ruling and the government stated that it plans to seek
legal redress from Rwanda as well even though the government in Kigali did not recognize the
court.
The UN panel of experts investigations released a list of 11 African States who directly or
indirectly assist in fueling the war in DRC. In the report the panel stated that this countries
allowed for the passage of goods originating in the DRC to other nations without following the
agreed rules. Those that were found to be directly involved in the conflict were, Burundi,
Mozambique, and the Republic of the Congo, South Africa, the United Republic of Tanzania
and Zambia. The Panel submitted questions to all 11 countries and held substantive discussions
with government representatives from five. The Panel enquired about relevant legislation and
investigations into the flow of the commodities, measures taken to curb those flows, other
possible action to be taken and those Governments needs for assistance. Four of the 11
countries the Republic of the Congo, Mozambique, the United Republic of Tanzania and
Zimbabwe declined to respond. The Panel later identified yet another transit point for
Congolese coltan, Nigeria, and requested information about this trade. No response was
received. Virtually none of the countries that responded to the Panels questions had conducted
any investigations or adopted any specific procedures for the identification or inspection of the
64
transiting of commodities from the Democratic Republic of the Congo. The Ugandan
authorities mentioned the impounding of a cargo of smuggled ivory. South African officials
confirmed the seizure of a sizeable clandestine shipment of diamonds from the Democratic
Republic of the Congo, but provided no details. None of the authorities in these countries gave
any indication that Congolese resources traded through their territories should or could be
regarded as conflict goods. Almost none of the countries proposed any meaningful measures
to help curb trade in Congolese commodities that are tainted by criminality and militarization.
Kenya, however, proposed the reopening of the Northern Corridor route, under the Transit
In addition the panel discovered through reliable sources that gem diamonds from Mbuji Mayi
in the Democratic Republic of the Congo account for much of the phenomenal increase in
diamonds transiting through Dubai in recent years. Exports from the United Arab Emirates to
Antwerp increased to $149.5 million in 2001 from $4.2 million in 1998 according to the
Diamond High Councils statistics. The Panel has been told of chartered flights direct from
Mbuji Mayi to Dubai, and other routes via Dar es Salaam, on which illicit diamond exports
have been carried. Likewise, Dubai has become a transit point for coltan from the Uganda-
controlled area and a portion of the diamonds originating from Kisangani in the Rwanda-
controlled area. The arms and diamond smuggler Victor Bout uses the United Arab Emirates
as his permanent base, with nine of his aircraft stationed at Ras al Khaimah International
Airport.
Zimbabwes deteriorating economy did not stop them from offering assistance to Joseph
Kabila taking into account that war is generally a very expensive affair and only capable
nations have the capacity to offer military assistance to allies. It begs the questions why
65
Zimbabwe saw it fit to engage in a war that did not directly affect them. The only reasonable
explanation for Zimbabwes action was geared towards safeguarding its political economic
interest to try and salvage their economy. Whether the move was successful or not the evident
outcome after the arrival of the troops in DRC was a surge of both potential and influential
America took part in the assassination of Patrice Lumumba through its CIA, to install a stooge
who could act as a gatekeeper by protecting Americans interests. Mobutu ascendancy to power
was crafted by the Americans and upon realizing that his regime was collapsing at the end of
the cold war they shifted their allegiance to the apparent heir Joseph Laurent Kabila through
an American company (AMF), both financial and military planes were channeled to Joseph
through AMF. DRC is not the only peculiar case where Americans have been accused of
promoting booty future. In, Afghanistan, Americans are said to have financed the Mujahidin
rebel groups, to a tune of $3 Billion to support the 300,000 militiamen in exchange for oil
rights.81
The Congolese citizens who fall under the state structure have constantly looted and smuggled
minerals to a point of becoming more powerful than the State itself. Looters working in the
mineral fields can be estimated to a population sample of 200,000 300,000. The looter are
however not referred to as looters but small-scale artisans. These small artisans account for
70% of mineral production in the DRC extractive sector.82 Their prowess and power can be
81
Chambliss, W. (1993). Making Law: The State, The Law, and Structural Contradictions. Indiana University
Press, Bloomington and Indianapolis.
82
Herman, J. C. (2015). The Mind of the African Strongman: Conversations with Dictators, Statesmen, and
Father Figures. New Academia Publishing.
66
corporations and even peacekeeping missions. If an entity evades their taxation rackets they
therefore resort to kidnappings and later on demand for ransom payments as a form of
taxation.83
Amnesty International and Human Rights Watch reports indicate that a big number of foreign
the fact that the first step to form a militia group has always been through individual looting
that snowballs into a group that controls a certain mine filed which later culminates into a full-
blown militia. Economists would argue that whenever a population is untaxed and unregulated
they, therefore, become stronger than the government because they accumulate more resources
than the government. The Zairenization program proved how citizens can become more
powerful and influential than the state that was due to the fact that Mobutu through cronyism
allowed his loyalists to loot and acquire more minerals for themselves.84
The act of sovereign states destabilizing other constitutionally instituted sovereign states for
self-gain is not only limited to DRC it also happened in Liberia in 1989 when Charles Taylor
led a battalion of 100 soldiers from Cote D ivoire to Liberia to conduct a coup de tat an act that
went against the countrys constitutional provision and Organization of African Union. Cote
D ivoire was not the only country that facilitated Taylors quest to overthrow Samuel Doe but
Burkina Faso and Libya too. Libya through its then leader Muammar Gaddafi offered Charles
83
Ibid.
84
Amnesty International and Human Rights Watch, (2003). Reports on DRC.
67
The three countries assistance to Taylor was not precipitated by their love for him and the hate
for his country, but it was mainly trivialized by their interest to loot the natural resources in
Liberia, mainly diamonds, and gold. Taylors unsuccessful attempt to ouster Doe worsened the
situation because instead of creating a regime change it plunged the country into a full-blown
armed conflict. The political instability made it hard for the government to take control over
the endowed resources areas, leaving most of its resources susceptible to looting, Taylor
himself earned a whopping $75 million dollars annually emanating from the mining sector.85
Emizet Kisangani insists that whenever neighbors intervene in DRC they come with their own
agenda.86 A good example of this statement was when state actors under the umbrella body of
ECOMOG who had been sent to pacify the conflict in Liberia opted to resort to looting upon
realizing Liberias rich unexploited natural minerals while in the line of duty. Nigeria a
hegemon in ECOWAS had the privilege of sending the largest peacekeeping troops to Liberia,
but instead of doing what they were sent to do which was help bring peace to Liberia they
instead used their military prowess as a looting conduit. Nigeria didnt stop at looting but went
further to collect taxation from timber and rubber export. Kenya has also been accused of going
against their intended mandate in Somalia through AMISOM where they have been accused
of taking taxation from charcoal that was being exported and imported by Somali militia along
Kismayo seaport. That is normally done under the watch of military elites at the behest of
political elites.87
85
Kimber lite Process Certification Scheme. Each country must designate an importing and exporting
authority., establish a system of internal control
86
Emizet, K. (2010). Civil Wars in the DRC. Kansasa State University.
87
International Jurist Black & White Report.
68
The examples mentioned above explicitly prove the involvement of state actors in defending
illegal actions that their men in boots and berets do. Multi-lateral agreements have turned out
to be associations of convenience to fulfill Political and Economic Interests.88 The study can
establish that peacekeeping missions indeed form part of the spoilers in well-endowed war-
torn countries, since they benefit a lot from the conflict and also help to secure the interest of
their state. This further explains why a big number of peacekeeping troops are always sluggish
when it comes to withdrawing their troops from the mission, Rwanda and Uganda were not
ready to withdraw their troops from DRC even after several peace accords had been signed the
same for Uganda and Kenya in Somali. The accrued benefit that they get from the mission
cannot be underestimated!
Non-State actors are all organizations, networks, associations that participate in the
international affairs and have sufficient power to cause shifts or change in international
relations even though they do not belong to any established state institution.
MNC are business entities that operate in more than one state. They usually have a parent
company stationed in one state and subsidiaries spread in different states. They have also been
referred to as transnational corporations although many academic authors have opted to use
rights, this meant that in practice MNCs were only subjected to domestic laws in which they
88
UN Charter
69
operate under but not internationally bound. This then explains why it has been difficult to
hold MNCs accountable for any actions that may contravene internationally, more so in
Political economists and security experts would write off DRC as an investment hub because
its environment is not conducive for business however that has not been the case since DRC is
second to South Africa when it comes to hosting the biggest number of MNCs. The questions
that the study would, therefore, beg to ask; how are businesses thriving in such an unconducive
environment? Could it be that they are part of the conflict? Those are some of the few questions
There is no doubt that commerce and conflict have a correlation, hence the terminology war
economies. Investigations by Global Witness have indicated that MNCs have the biggest
networks in conflict finance, that is why Global report have recommended in their reports that
the fastest way to end the conflict in resource-endowed countries is by introducing trade
embargoes on certain natural resource commodities. In DRC for instance, 85 companies were
listed as being in contravention of the Multinational Enterprise Guidelines, this was due to
their illegal resource exploitation. Most of these countries were found to be originating from
The study has realized that it would be wrong to pass a blanket assumption that all MNCs in
representative from the embassy of DRC, there are several MNCs in DRC who conduct
business legally and there those MNCS that conduct illegal business. Those conducting legal
89
Kramer, R. (1982). Corporate Crime: An Organizational Perspective. Pp. 75-94. In Wickman and Tom
Daily Eds. White Collar and Economic Crime. Lexington, KY: Lexington Books
70
business, however, have found themselves through unintended purposes contributing to
conflict finance through the complex financial web. Their role in fuelling the conflict is
unintended, unintentional and indirect. However, those conducting illegal business fuel
conflict deliberately to profiteer from trade. Rebels and middlemen play the role of security
forces in the commercial web. The war is the most conducive atmosphere to conduct business
simply because domestic laws are difficult to enforce and thus basic legal requirements like
taxation, payment of legal requirements and others are not utilized. Worst still MNCs also
enjoy the use of unregulated labor force making it easier and profitable for them to run their
Conflict finance between MNC, governments, and rebel groups are in many at times forged
through concession rights, royalties and bonuses that are later used to oppress opposition,
minority groups and ultimately counterinsurgencies. For instance, the U.S.-based mining firm
American Mineral Fields reportedly signed contracts with the Alliance des Forces
Dmocratiques movement of then-rebel leader Laurent Desire Kabila over mines that the
According to the UN report, Illegal exploitation of the mineral and forest resources of the
Democratic Republic of the Congo is taking place at an alarming rate in two phases; mass-
scale looting and the systematic exploitation of natural resources. Corporations from around
the world have sought to profit from exploiting DRCs natural resources on the cheap
particularly coltan, a mineral used to produce cell phones, laptops and video game consoles.92
90
Ibid.
91
Collier, P and Hoeffler, A. (2002). Greed and Grievance in Civil War. p. 1. We have found that greed out
powers grievances.
92
https://www.justice.gov/sites/default/files/eoir/legacy/2014/02/25/Congo.pdf
71
The report also indicates that a number of companies were created to facilitate illegal activities
in the Democratic Republic of the Congo. Others have existed in the region for decades and
joined the bandwagon to pursue the obvious financial windfalls involved in the exploitation of
the country. On the Ugandan, MLC and RCD-ML side, rebel leaders and/or Ugandan military
officials created new companies and businesses using prte-noms. Most, if not all, of these
Among the companies mentioned by the report that are involved in the illicit acquisition of
natural resources in the Democratic Republic of the Congo, Trinity and Victoria seem to be
the most interesting given their modus operandi, activities and respective shareholders.
Victoria Group is chaired by Mr. Khalil and its headquarters is in Kampala. According to
reliable sources, Mr. Khalil deals directly with Mrs. Akandwanaho on diamond issues. Mr.
Khalil has two collaborators in the Democratic Republic of the Congo, based in Kisangani and
Gbadolite. Both are said to be from Lebanon, they are Mohammed Gassan and Mr. Talal.
During its visit to Gbadolite, the Panel received confirmation of the presence of one of them
and his leading role in the purchase of diamonds in the region. A reliable source told members
of the Panel that the Victoria Group belongs jointly to Muhoozi Kainerugabe, son of President
Museveni, and Jovia and Khaleb Akandwanaho. Victoria Group is involved in trading
diamonds, gold and coffee. The Group purchases these mineral and agricultural products in
Isiro, Bunia, Bumba, Bondo, Buta and Kisangani. The company paid taxes to MLC, but failed
to do so with RCD-ML. When counterfeit currencies (Congolese francs and United States
dollars) were found in areas where the company buys the natural resources, fingers were
93
UNEP, MONUSCO and SESG Report 2001.
72
pointed at the Victoria Group. Other sources have also confirmed to the Panel the involvement
and now the Commissaire gnral adjoint of FLC, was the manager of the company. According
owned by Salim Saleh and his wife. Its primary purpose was to facilitate their business
activities in Orientale Province. To this end, Mr. Tibasima granted a tax holiday to all Trinity
activities in the areas controlled by Uganda and administered by RCD-ML in November 1999.
Trinity has imported various goods and merchandise and has taken from Orientale Province
gold, coffee and timber without paying any tax. Different individuals, Ugandans as well as
Congolese, have taken the opportunity created by the confusion over Trinity to export from
the Democratic Republic of the Congo (on behalf of Trinity) various natural resources, also
One of the most sought after mineral in DRC currently is Coltan. According to research firm
Roskill Information Services DRC has the world's fourth-largest coltan reserve in the world.
Its scientific name is Columbite-tantalite. Once refined, coltan can be used to produce highly
heat-resistant metal powder called tantalum. It sells for $100 a pound, and it's becoming
increasingly vital to modern life. For the high-tech industry, tantalum is magic dust, a key
94
Ibid
95
Ibid
73
component in everything from mobile phones made by Nokia (NOK) and Ericsson and
computer chips from Intel (INTC) to Sony (SNE) stereos and VCRs.
Not surprisingly, selling coltan is not illegal. Most of the worldwide tantalum supply valued at
as much as $6 billion a year comes from legitimate mining operations in Australia, Canada and
Brazil. But as demand for tantalum took off with the boom of high-tech products in recent
These companies deny any knowledge that tantalum originating in the Congo is used in their
products. That's not surprising, considering how murky the supply chain out of the Congo is
and how complicated the global trade in tantalum gets. The reality is that there's little way to
prove that the tantalum used in our cell phones and laptops is or is not from the Congo. Still, 8
percent of the tantalum ore imported into the United States in 1999 came from the Congo, and
that doesn't count the ore U.S. companies imported from Rwanda and Uganda that may have
The UN report also highlighted that the demand in for the highly prized coltan has enormous
impacts. According to the report, given the substantial increase in the price of coltan between
late 1999 and late 2000, a period during which the world supply was decreasing while the
demand was increasing, and a kilo of coltan of average grade was estimated at $200. According
to the estimates of professionals, the Rwandan army through Rwanda Metals was exporting at
least 100 tons per month. The Panel estimates that the Rwandan army could have made $20
million per month, simply by selling the coltan that, on average, intermediaries buy from the
small dealers at about $10 per kg. This is substantial enough to finance the war. Here lies the
vicious circle of the war. Coltan has permitted the Rwandan army to sustain its presence in the
Democratic Republic of the Congo. The army has provided protection and security to the
74
individuals and companies extracting the mineral. These have made money which is shared
with the army, which in turn continues to provide the enabling environment to continue the
exploitation.96
The report also found that Rwandan, Ugandan and Burundian rebels had looted and smuggled
thousands of tons of coltan from the Congo into their countries to export to the global market,
using the profits to finance their militias. Indeed, the official statistics provided by these
countries' governments which many human-rights observers believe hide large amounts of
black-market trading - show that Uganda and Rwanda dramatically increased the export of
coltan following their occupation of northeastern Congo. For example, Uganda reported 2.5
tons of coltan exports a year before the conflict broke out in 1997. In 1999, the volume
exploded to nearly 70 tons. Uganda, Rwanda and Burundi have issued protests to the United
In 2003, a follow-up report was made in which it was mentioned that, in 1999 and 2000 a sharp
increase in the world prices of tantalum occurred, leading to a large increase in coltan
production in eastern Democratic Republic of Congo. Part of that new production involved
rebel groups and unscrupulous business people forcing farmers and their families to leave their
land, or chasing people off land where coltan was found and forcing them to work in artisanal
mines. As a result, the widespread destruction of agriculture and devastating social effects
96
Batware B. 2011. The role of multinational corporations in the Democratic Republic of Congo. MA Peace
and Conflict Studies | EPU.
97
Ibid
98
Ibid
75
In 2008, the UN issued another report in which it was revealed that coltan and other minerals
continue to be taken out of the DRC while more money was brought in. The report mentions
that in fact, last years foreign direct investment into the DRC was the highest in the history of
U.N. records on trade and investment. This is particularly important because this money
contributes to the conflict by providing financial support to groups involved in it. Among these
groups are the Forces Democratiques de Liberation du Rwanda (FDLR) and the Coalition of
Congolese Patriotic Resistance (PARECO), who have been accused of abducting children to
When they carry out their business, multinational corporations that profit most from the
conflicts often times hide behind a carefully constructed shield of ignorance, arguing that they
are not aware of the provenance of the minerals that they purchase. However, these claims of
ignorance are disingenuous at best: the latest UN report indicates that companies are carefully
avoiding any investigations that might reveal the truth; further, corporate management refuses
to perform sufficient due diligence regarding their suppliers, thus failing to meet minimum
standards of ethical business conduct. Companies are certainly not going beyond this basic
standard by taking steps to ensure that they are not purchasing conflict minerals. Instead, they
To assess the supply chain of some minerals in DRC the study came across a report of how
Coltan is expolited from the mine to the end user. According to the UN panel of experts report
Coltan has been exploited extensively in Orientale Province by various armed groups under
the protection of UPDF. A number of coltan operations, especially under the supervision of
99
Ibid
100
Ibid
76
UPDF Colonels Muzora and Burundi, have been coordinated under the front company Trinity
Investment, where UPDF Major General Kazini is the principal figure. 101 Armed groups
frequently identified with militias under the command of UPDF officers manage sites in remote
locations where diggers pay a daily fee to exploit an area. Valentina Piskunova who, together
with her husband Anatoly Piskunov, represents and operates the company LA CONMET from
its base in Kampala. During discussions with the Panel, Ms. Piskunova explained that, because
of the collapsed international coltan market, prices for the mineral in the eastern Democratic
Republic of the Congo had dropped dramatically. However, Ms. Piskunova told the Panel that
the continuing international interest in coltan from the Democratic Republic of the Congo is
due to the very low labour costs for extracting the mineral. Therefore, the company continued
to buy coltan from its office at Butembo in the Democratic Republic of the Congo. She said
that their purchase price for coltan with a 30 per cent tantalum content was $10 per kilogram.
The same coltan was then sold for $17 per kilogram.102
Ms. Piskunova went on to tell the Panel that the companys coltan was transported by road
across the border between the Democratic Republic of the Congo and Uganda at Kasindi to
Entebbe International Airport, where it was then transported by Boeing 707, via Sharjah,
United Arab Emirates, at a cost of $140,000 per flight, to Ulba, Kazakhstan, for processing. In
addition to the profit made on the sales of coltan, LA CONMET also experienced savings by
being granted full exoneration for all activities involving exploitation for the territory of
Beni-Lubero (Democratic Republic of the Congo), including freedom from paying fiscal and
customs duties. The networks are all well coordinated and at times due to the high risk of
101
Letter dated 8 October 2002 from the Chairman of the Panel of Experts on the Illegal Exploitation of Natural
Resources and Other Forms of Wealth of the Democratic Republic of the Congo addressed to the Secretary-
General
102
Ibid
77
conducting business the company stated that they had to pay rebels to ensure safe
transportation of the minerals.103 This example is only one of many webs in DRC that shows
In certain circumstances, financial conflict is directly paid as bribes to either rebel groups, or
even opposition officials to destabilize the government in power. These financial transactions
later have a direct impact on the citizenry and rebel groups through the trickle-down effect. In
the event that these MNC avoid direct transactions with rebel groups, the latter has always then
resorted to kidnappings upon which ransoms are paid to facilitate conflict finance.
conflict in DRC during their operations by having to pay security fee to the rebel groups for
protection and exploitation rights. A good number of MNCs have gone as far as contracting
private military, militia and rebel groups to offer security in their areas of exploitation. Security
therefore forms a very lucrative business for the rebel groups to generate conflict finance.105
De beers activities in DRC has resulted to numerous scandals that have put them on the
frontline of DRCs conflict. The lastest trend in the African continent of using mercenary
companies to quell wars and bring peace has seen many companies run from the normal use of
rebels to contracting private companies. De beers has been linked to one of the leading Private
Military Companies (PMCs) in the industry. Their activites in DRC have led to investigations
of their controversial military actions and mining activities which called for restrictions to be
taken against them by the South African government.106 The Company has also been linked to
103
Ibid
104
Ibid
105
Garrett, N. & Mitchell, (2009). Trading Conflict for Development. P.6.
106
Ibid
78
the former military president of Sierra Leone, Valentine Strasser, who allegedly awarded
diamond licenses to EO for fighting the rebels and brining him to power.107 African states and
even NGOs are increasingly using the services of mercenaries as they have been believed to
bring some form of normalcy in active combat zones. Cirtiques on the hand negate this notion
and argue that the use of mercenaries has only activated a boom in the business of war.108 In
addition, mercenaries have been accused by the international community for going against
human rights but because they are private companies it has been difficult to pin them down.109
International trade and the high demand for solid minerals in DRC has precipitated conflict
finance and thus a contribution to resource conflict through the supply chain web. In as much
as the government has always issued official extraction rights to MNC, extraction of the
minerals has posed a challenge because the minefields are still under the control of warlords.
Companies are therefore forced to re-negotiate with the rebel groups, the negotiation, therefore,
The supply chain is complex with various actors drawing payments from the chain, goal posts
get shifted and different mechanisms are deployed to avoid official authorities. However new
demands reemerge from the various actors involved, a good number of them feel short-changed
whereas some fail to fulfill their bargains and with that comes disagreements and the conflict
explodes again.
Illicit finance being generated from a natural resource in DRC can be capped at US$ 1.25
billion per year out of that generated amount 10 30% of it goes to conflict finance which is
107
Pech K. Executive Outcomes A Corporate Conquest.
108
Ibid
109
Ibid
110
Karlsson, Ida. EU Urged to Ban Conflict Minerals.
79
about US$ 72 - 426 million per annum. To further break it down, each commodity attracts the
following resources; gold US$40 120, Timber US$ 16 48, Charcoal US$ 12 35 Million,
3T Mineral 7.5 22.6 Million, Diamond US$ 16 48 Million, Local Taxation US$ 14 .3 28
Million. The figures, therefore, give an indication that war in itself is a self-sustaining economy
as President Paul Kagame once reiterated and that is why MNC are thriving in DRC.111
UNEP findings indicate that conflict finance being generated from DRC is sustaining over 25
rebel groups, whereas other sources indicate that its sustaining more than 49 rebel groups
within the country. The rebel groups are playing a checkmate game to prevent one another
from playing a dominant role in the trade, the weaker rebel groups have their own survival
strategies and criminal networks, forming part of a transnationally organized crime web.
Some scholars have argued the need and demand for minerals that are used for high tech
devices and luxury items like gold helps in fueling the conflict. In addition to fueling the
conflict ending it is an even bigger challenge but not an impossible one. Several people have
gone out to investigate the involvement of Multinational corporations in fueling the conflict in
DRC. So far, high-tech companies have been reluctant to acknowledge they may be using
materials originating from DRC however, they could do little to prove that they do not. The
111
UNEP, (2015). Report on Illegal Exploitation of Natural Resource In DRC: Benefiting Organized Criminals
in DRC.
112
Batware B. 2011. The role of multinational corporations in the Democratic Republic of Congo. MA Peace
and Conflict Studies | EPU.
80
3.3.3 Reactions from MNCs
"We first heard about this in April and immediately asked our suppliers if they used tantalum
from the Congo," said Outi Mikkonen, communications manager for environmental affairs at
Nokia. "All you can do is ask and if they say no, we believe it." And so it continues down the
line. Tantalum capacitor makers place their faith in their suppliers. One of Nokia's main
suppliers, for example, is Kemet of Greenville, S.C., the world's largest tantalum capacitor
maker. "We have gone back to our suppliers to ascertain that the material we are buying is not
obtained illegally from the Congo," says Harris Crowley Jr., a senior VP.113
But tantalum suppliers can offer little assurance to capacitor manufacturers that their product
doesn't come courtesy of the Congo rebels. "I'm not in favor of killing gorillas," says Dick
Rosen, CEO of AVX, a tantalum capacitor maker in Myrtle Beach, S.C. But "we don't have an
idea where the metal comes from. There's no way to tell. I don't know how to control it," he
says.114
Epcos, a tantalum capacitor manufacturer in Munich supplying the mobile phone industry, is
also quick to place the responsibility on its suppliers - which include Cabot and H.C. Starck,
as well as smaller processors in Europe and Japan. Heinz Kahlert, a spokesman for Epcos,
pointed to a press release issued by H.C. Starck that states "we only purchase raw materials
from established trading companies that have worked in various African countries for a long
time and are headquartered in Europe or the United States." The press release goes on to claim:
113
Ibid
114
Ibid
81
"These trading companies have confirmed that H.C. Starck is not being supplied with material
At some point though, the wall of plausible deniability starts to break down. While H.C. Starck
is adamant it is not being supplied with black-market coltan, one of its own suppliers, U.K.-
based trading company A&M Minerals and Metals, is less sure. A&M works mostly with
Nigerian and Bolivian miners, but also buys up to 3 tons of tantalum-bearing ore a month from
Uganda. "I couldn't tell you 100 percent that this material from Uganda didn't come from the
Congo," says managing director James McCombie. "It could have been smuggled across the
border." The company works with peasant producers and local traders, and McCombie admits
that "once you get to that level, it is very difficult to check the provenance. It would be silly of
us to try to pretend that we know the origin of every pound of coltan we get in our hands."116
Then there's Brussels-based Sogem, another international trading company that sells the
unrefined coltan it buys in the Congo and Rwanda to processing companies in the United
States, Europe and Asia. It offers only a vague reassurance about the origins of the ore it resells.
"We have been told that our money goes directly to the population," says Sogem spokeswoman
Moniek Delvou. Sogem doesn't deal with rebel-backed traders and monopolies in the region,
Delvou says. But she declines to name the mines and local trading companies that supply
Sogem and admits she isn't 100 percent sure of the original source. "How can you be 100
115
Ibid
116
Ibid
117
Ibid
82
Ericsson says it requires its suppliers to comply with company environmental, ethical and
human-rights policies. "We are putting demands in place and will follow it up," says Mats
will start requiring ore suppliers to certify that their tantalum does not come from the Congo,
Rwanda, Burundi or Uganda. "If everybody takes a stance, maybe it will dry up," says Kemet's
Crowley.118
For its part, Intel has begun a review to determine the source of the tantalum it uses. "We'd like
to be able to know the answer," says spokesman Chuck Mulloy. Compaq has issued a statement
saying it "condemns the reported activities of illegal miners in the Democratic Republic of
Congo." But, as spokesman Arch Currid says, "Most of the components that we get from third-
party providers, so where they get their raw goods is hard to determine." Hewlett-Packard
officials also denounce the situation in the Congo and say the company intends to work with
Despite suggestions from different NGOs such as Global witness that mobile companies
should at least publish their supply chains on their websites, companies such as Nokia have
refused saying that there many other things to consider when one is taking these kind of actions.
They worry more about their competitors and their profits than the impacts their business is
having on human life in DRC. When asked what should be told to the children of DRC who
hope that western companies will hear their crying and take measures, one Nokia
representative said that they should have hope, there is hope in the future. One can only
118
Ibid
119
Ibid
83
wonder, what has been done since it has been known in 2001 that these companies are using
minerals coming from the DRC which are contributing to the continuation of war.120
NGO are the main structures of the society and they exist outside the government and public
administration, they, however, form part of the economy whereas their real establishment is
for non-profit making. This sector is sometimes referred to as the third sector in reference to
the private sector and the public sector. NGOs are mandated to ensure that the society is
has partly contributed to the growth of conflict finance. Non-Governmental Organizations and
Faith-Based Organizations operating within the war-torn regions like Kivu, and Katanga have
been forced to pay taxes so that their aid can get to the intended victims. The taxation that they,
Non-governmental actors just like MNC have been forced to hire rebel groups and militia
groupings to offer security to either their staff or the aid on transit, if that is not done then they
have been forced to indirectly pay for that by remitting ransom to their staff who have either
been abducted or kidnapped. By paying the ransom then the non-governmental sector
indirectly contributes to the conflict finance. According to global witness reports, militia and
rebel groups are not only limited to taxing and kidnapping members of the third sector but go
as far as stealing the aid and donations that they have been provided for, with the sole intention
120
Ibid
84
of selling them to outsource for more funding that goes into conflict finance. 121 Through
taxation and selling of the aid donations, rebel groups, therefore, raise finance.
NGOs have also been accused of misusing their diplomatic immunities and leverages to
smuggle in weaponry and smuggling out minerals to governments and rebel groups through
the immunity that they enjoy hence directly contributing to conflict finance. When the DRC
peace accord was about to be signed 300 NGOs based in DRC petitioned the special envoys
not to sign the peace agreement. That gives a clear indication that these non-state actors had a
hidden interest and therefore their actions allow the study to profile them as spoilers to the
conflict. The donor funding that they receive is highly dependent on the conflict. (British
121
See, Human Rights Watch, (2009) Soldiers who Rape, and Commanders who condone.
122
See, British Global Witness Publication on Rough Trade.
85
CHAPTER 4
MEASURES
4.1 Introduction
Statistics indicate that most of the war-torn African countries are rich in mineral resources and
the assumption is that minerals are a precursor to State failure and subsequent conflicts. David
Easton reiterates that the state finds itself in these compromising scenarios because its for her
to determine who gets what, how and when, when it comes to resource distribution. DRC is
richly endowed with mineral resources and the countries development highly depends on how
well the extraction of these resources is governed. Natural resources in themselves are neither
a blessing nor a curse. What highly matters is how well the extraction is governed.
Policymakers and researchers have made much of the specter that in DRC its all about resource
More into the resource curse narrative is that DRCs natural resource conflict can be linked
and attributed to colonial legacy, where the Belgians colonized DRC with the sole intent of
looting the natural resources, the administrative and governance structures that were placed by
the Belgians and subsequently inherited by the post-colonial regimes maintained the status quo
of looting thus depriving the masses. The Belgians demarcated DRC regions in terms of
resource endowment. Belgium has maintained a strong tie with DRC regimes to maintain the
colonial legacy of looting the natural resources. Between the year 2001 and 2002, all the
86
leading 40 MNC trading on the diamond in DRC were Belgian companies a monopoly that
they're enjoyed due to their colonial legacy that King Leopold had established.123
Several litrature have declared the Democratic Republic of Congo (DRC) as one of the worlds
richest territorial states in regards to its natural resources. Scholars state that DRC possess
literelly every mineral in the periodic table. The main resources that have caused DRC to face
decades of war include copper, cobalt, zinc, diamonds, oil, timber, uranium, tantalum,
columbium, gold and tin. The sheer volume of natural resource abundance should, at least in
theory, provide the state with enormous revenues for redistribution among its citizens. Yet,
almost 60 percent of its 80 plus million people live on less than $1.25 a day.
At present, cassiterite ore (which is refined to produce tin) is the leading mineral in terms of
dollar value contributing to armed groups in the DRC. The country is the worlds sixth leading
producer of tin, although estimates of total production vary. The Enough Project calculates that
the eastern DRC produces over 24,000 metric tons of tin, or 6-8% of global production. This
likely contributed about $115 million to armed groups in 2008.66 Over half of this material
comes from the Bisie mine in North Kivu, which has changed hands among armed groups
several times and is currently controlled by a unit of former CNDP rebels now integrated into
the Congolese army. Although coltan ore (refined to produce tantalum) is not as significant as
cassiterite in its financial contributions to the conflict in the DRC, it was the first conflict metal
from the DRC to be the subject of global concern in the early 2000s, as the price for the mineral
spiked in conjunction with growing demand from the electronics industry. The DRC is one of
the leading producers of this material, estimated by one source at 155 metric tons (tantalum
123
Ibid. P, 45.
87
equivalent) annually, or 15-20% of global production (in contrast, nominal U.S. Geological
Survey (USGS) figures estimate 100 metric tons of production in 2009 and 8.6% of the global
total indicating some of the variability in statistics related to these minerals)68. This may have
Resources have been used to fuel conflict and not to get people out of poverty. In 2007, the
Human Development Index ranked the country at 168 positions out of a total of 177 countries.
The unstable situation has provided a fertile ground to the stakeholders to exploit the natural
wealth of DRC with impunity. As Reyntjens wrote, Entrepreneurs of insecurity are engaged
criminalization context in which these activities occur offers avenues for considerable factional
and personal enrichment through the trafficking of arms, illegal drugs, toxic products, mineral
Poverty is not the only problem facing the population of the DRC which enhances conflict
financing. The state has been faced constant conflict and immense suffering since colonial
times. It has resulted to the death of at least 4 million people and causing massive declines in
economic growth which contributes to political instability. The Human Development Report
(HDR) of 2011 has ranked the DRC in the bottom of the table. Out of 187 countries the DRC
currently occupies the 187th seat in the Human Development Index (HDI). As the HDI is
based on criteria such as health, education, level of freedom, gender equality, poverty, political
participation, economic growth and environmental development, the DRC scores an all-time
Armed groups sustaining themselves through profits from illegal exploited natural resources
have created regional insecurity complex. For instance, the Allied Democratic Forces (ADF),
88
a rebel group from Uganda operating in the DRC, has been linked to illegal taxation of gold
and timber and the Democratic Forces for the Liberation of Rwanda (Forces Dmocratiques
de Librationdu Rwanda, FDLR) has been implicated in trade in minerals, timber, and
charcoal, as well as cannabis production. Criminal elements within the Congolese Army
(Forces Armes de la Rpublique Dmocratique du Congo, FARDC) have also been implicated
in illegal taxation and exploitation, notably during the six-month eastern DRC mining
The demand in global markets is also a perpetuating factor. The minerals tin ore and coltan are
important components of cell phones, computers, and other electronic devices, and the DRC
is a primary global source. This demand encourages regional smuggling as a means for
individuals and collectives to illegally profit from natural resources. Illegally armed groups are
reported to control access to mines in remote areas where they subject civilians to gross human
rights abuses and displacement. Apart from the regional aspect of illegal trafficking of these
minerals to finance armed group activities and the criminal profit motive, minerals are also
used in lieu of hard currency for trading to fund conflict. This includes the supply of arms.53
In the final report of the United Nations Group of Experts on the DRC, it was concluded that
the involvement of the military and armed groups in illegal mineral trade was by way of
taxation, protection, commercial control and coercive control. Taxation involves levying
illegal taxes on mining activities and unrelated commercial activities in the area. Protection is
requested of military and armed groups to provide security forming activities and to prevent
looting. For commercial reasons, the military use illegal revenue to engage in mineral trade.
Military and armed groups gain control through seizing productive pits and periodically
pillaging minerals. The involvement of the military in the illegal exploitation and trade in
89
natural resources has compromised their mandate to provide civilian protection. In reference
to these criminal elements in the army, it was observed that deployment of these criminal
networks is increasingly driven by the desire to control natural resources. Illegally armed
groups form a vital component of the natural resources/conflict nexus. Their role in
regionalizing insecurity is partly financed by illegal exploitation and trade in natural resources.
This underlines the importance of adopting a regional perspective with regard to natural
A dozen major peace agreements, negotiations, and reconciliation initiatives, often brokered
with help from the international community, have been the primary vehicles employed to
resolve conflict in DRC in the Great Lakes region. Most of these accords, however, have
addressed only some of the causes and consequences of the conflict and, at times, neglected its
principal drivers which are equivalent in medical fields of curing the symptoms and not causes
of the diseases. The measures in most cases are employed only when the conflict is full blown
and this has led to partial conflict resolution in the DRC. The International Conference on the
Great Lakes Region (ICGLR) has to date been the largest peace initiative. Convened by UN
Resolution 1291 in 2000 and held under the auspices of the African Union and UN with support
from international donors, it brought 18 countries to the negotiating table of which were
directly involved in the conflict. After 6 years of political negotiations, the conference gave
rise to the Pact on Security, Stability, and Development in the Great Lakes Region, signed in
December 2006 by heads of state from Angola, Burundi, the Central African Republic, the
DRC, Kenya, the Republic of Congo, Rwanda, Sudan, Tanzania, Uganda, and Zambia.
90
The pact entered into force in June 2008 after it was ratified by eight signatories. An ICGLR
regional non-aggression and mutual defense, good governance, and reconstruction and
development. Only limited progress toward these objectives has been realized to date,
however. A key contribution of the ICGLR has been that it took into account the economic
dimensions and motivations of the conflict in the eastern DRC. Specifically, it launched a
Regional Initiative on Natural Resources to certify, formalize, and track the minerals trade so
as to eliminate trafficking and the role of armed groups. Pilot schemes in Rwanda and South
The ICGLRs main shortcoming has been that it did not address the massive human rights
violations committed by various state actors that intervened in the DRC that have now been
well documented through UN reports. As a consequence, these actors have had little incentive
to end their reliance on short-term military responses and proxy militias to meet their
immediate security and economic interests. The Tripartite Plus Commission was a U.S.
initiative launched in 2004 dealing mainly with the FDLR presence in the DRC. This initiative
culminated in a joint communiqu on November 9, 2007, committing the DRC and Rwandan
governments to a common approach to address the threat posed to their common security and
of the Rwandan Defence Forces (RDF) to more aggressively target the ex-FAR remnants that
comprise the FDLR. The FARDC-RDF collaboration has been very unpopular in the eastern
91
4.3.1 Goma Conference
The Goma peace conference has been the only one initiated by the DRC government. From
January 624, 2008, the conference brought together 1,500 delegates from all communities
and social strata in North and South Kivu. Its general objective was to rally stakeholders and
involve them in the restoration of peace in the area. Delegates ultimately signed an
Actedengagementto cease hostilities. By giving all communities and most armed groups a
voice, the Goma conference represented a significant step forward in understanding the conflict
from local perspectives. And a high priority for these communities was to prevent those guilty
of committing massacres, sexual violence, or inciting ethnic hatred from holding positions of
responsibility, particularly in the security services. After the conference, the involvement of
traditional village chiefs and other community leaders facilitated the disarmament or
integration of 22 armed groups into the national army indicating a strong desire at the local
92
4.3.2 Regulating Commodity Trade from Conflict Areas
Specialized industry organizations such as the Tantalum Niobium International Study Centre,
the International Gold Council and the International Coffee Federation could be requested, in
cooperation with the United Nations Conference on Trade and Development, to monitor trade
in commodities from conflict areas. This would result in a reliable body of data that includes
countries and information on end-users and their operations.124 The data produced could be the
basis of industry policing of those individuals, companies and financial institutions that trade
in commodities from conflict areas. The data could also serve in the event that a moratorium
is called for on the illegal trade in commodities originating in the Democratic Republic of the
Export policy and incentives must be harmonized at a regional level to eliminate smuggling.
For instance, an exporter will pay a taxation fee of $200 for a barrel of tin ore being exported
from Rwanda to Europe, the same exporter in DRC will pay $6,500 for the same barrel to be
exported to Europe. It is such inequalities that promote conflict finance through smuggling,
countries from the great lake region should, therefore, develop a unifying protocol on natural
resources that bring in a regional pact, upon its development the regional Heads of State should
124
Letter dated 8 October 2002 from the Chairman of the Panel of Experts on the Illegal Exploitation of Natural
Resources and Other Forms of Wealth of the Democratic Republic of the Congo addressed to the Secretary-
General
125
Ibid
126
Ibid.
93
A transnational mining authority should be established by the international community
alongside the DRC government, the authority should be in charge of certifying traders and
other actors. The authority should also be in charge of all mining fields by overseeing the
activities that are being undertaken at a local level and also evaluate the supply chain racket.127
The Kimberly process, for instance, was meant to prevent the sale of a blood diamond, the
policy has been a success in Liberia due to its non-tariff barrier component. The process lays
emphasis on the certification of the minerals so as to be able to determine the origin of the
mineral. The process emphasized on a quota system whereby a number of minerals being
Kimberly process has been the universal policy document on solid minerals, it has fallen short
in curbing resource finance on other solid minerals like coltan, tin, tantalum, and tungsten used
to make electronic materials. The Kimberly certification process was specifically developed to
curb blood diamond and not all solid minerals that contribute to the finance of conflict.129
World Bank, however, insists that the Universal Kimberly Policy certification system has been
the best policy to be ever developed by the United Nations despite its shortfall in DRC. They,
however, argue that the Kimberly certification process has enabled DRC to regain 70% of its
lost extractive sector, they argument that most of the minerals being smuggled to the
neighboring countries are always certified. And therefore its operationalization should be
127
http://www.itri.co.uk/POOLED/ARTICLES/BF
128
The Kimberly process, made sure that all the diamond being sold in the global market must be accompanied
by a certificate of origin to ensure that its not blood diamond
129
See, The Kimberly Certification Process. https://en.wikipedia.org/wiki/kimberly.
94
emphasized to ensure that lootable minerals do not find their way into the black markets.
Sanctions on individuals and MNC that have been found to smuggle materials should also be
highly emphasized.130
The Kimberly process, therefore, reaffirms the studies justification that the Fragile States
should not be allowed to liberalize their economies fully, some form of protectionism must be
exhibited and emphasized. 131 In as much as full protectionism is not the route to go, the study,
therefore, advises that neoliberalism is adopted in DRC. Neoliberalism is better placed because
it talks about the institutionalization of mineral fields and the establishment of private
enterprise through a
proper regulatory mechanism where the government can be able to generate revenue and
Chile for instance after the dictatorial rule of Augusto Pinochet adopted neoliberalism at the
expense of liberalism, today Chile has a stable economy. The shift from industrial mining to
small-scale mining by DRC has denied the central government revenue and resources to work
can be monitored and controlled whereas small-scale mining breeds cartels which eventually
build up into rebel groups that take control over minefields, that was the case with ADFL.
Small-scale mining develops extraction rights to small cartels that eventually form militia
groups, by having extraction rights to the small-scale miners, cartels and middlemen acquire
full control of the minefields thus in a position to generate conflict finance. As Collier
130
Ibid
131
Establish a system of internal control. Enact appropriate and regulations to implement and enforce
certification.
132
Patricia, C. & Andrea, R (2014). Rwanda INC: How a Devastated Nation Became an Economic Model For
The Developing World.
95
reiterates, easily extractable alluvial solid minerals attract booty future agreements. 133 Collier
further reiterates that when easily extractable mineral resources are not well managed, they
then become susceptible to looting, with looting cartels and rebel groups demarcate resource
endowed regions, to later claim ownership over the resources. The act of demarcation by cartels
The UN panel of experts provide the following recommendation in regards to the use of the
Kimberly process to curb conflict finance in DRC. Member States where trade in rough
diamonds and other raw minerals is being carried out should join the Kimberley Process.
Universal participation will make the Kimberley Process a more effective instrument.
Countries with rich in natural resources should apply internal controls from extraction to
upon standards for this process. A specialized enforcement organization within each member
country needs to be formed that has the authority, knowledge and specialized training
secretariat should be created with the responsibility of coordinating the implementation of the
Kimberley Process.
Economist Intelligence Unit asserted that the current economic and political challenges facing
DRC were as a result of the collapse of the Zairean State. The unconstitutional change of
government through foreign support gave rise to ethnic groups that are at war with each other,
133
Ibid.
134
Ibid. p, 563.
135
Ibid
96
it also presented a mutiny within the military, that later gave rise to a private militia, rebel, and
tendencies, corruption, nepotism and the use of military elite to capture state resources.
Paul Collier reiterates that to curb finance conflict and booty futures, the DRC government
must, therefore, undertake key reforms in its governance structures. It should first ensure that
all the mining fields are brought under state control to provide a revenue base for local and
provincial authorities. All stakeholders and actors in the solid mineral trade must be brought
together for a dialogue on how to reform and review the trade sector.136
The various peace accords that were signed under the Unified Transnational Agreement
should be operationalized and adhered to the letter. The four peace agreements are the Lusaka
Ceasefire agreement (1999),137 the Sun City Agreement(2002), the Pretoria Agreement (2002),
and the Luanda Agreement (2002).138 Actualising the peace agreements in totality is very
important since it is the only avenue to address the Humanitarian situation in DRC. The study
acknowledges that
livelihoods in DRC must be taken care of, since the conflict has seen gross violation of human
rights, women and children raped, some being turned into soldiers at a tender age, abduction
of people, displacement of persons resorting to internally displaced persons, the refugee crisis
bulging, actually the natural resource conflict in DRC has contravened the Rome statute of
1998.139
136
Collier, P. (2009). Wars, Guns and Votes. Democracy in Dangerous places.
137
Among the first peace agreements to be signed it was the first road map towards pacifying DRC.
138
See, the Lusaka Ceasefire agreement (1999), the Sun City Agreement (2002), the Pretoria Agreement (2002),
the Luanda Agreement (2002), the Unified Transnational Agreement.
139
International, C. C. (1998). The Rome Statute.
97
Cohen J Herman a political and security expert, views DRC as a failed state for its inability to
manage the rich mineral provinces. Lack of a powerful central government to control the
mineral endowed provinces provokes the profiling of DRC as a failed state. Determining,
whether a state is failed, has always been considered to be a political term. But Ross brings a
few pointers that may justify the statement (i) The central government of DRC in many at times
has lost control over her endowed territories to rebel groups which is not expected of a stable
state but is the case for DRC (ii) the central government in order squash local rebels has always
resorted for external support not limited to military and financial support. A well-established
government should have the capability to squash any internal rebellion, if that cannot happen
Poor governance contributes to conflict finance there are countries in Europe like Australia
and the United Arab Emirates which are well endowed with natural resources but are not facing
any natural resource conflict, proper governance systems must be therefore adopted.141
Marginalization breeds a mentality of we verse them and thus a recipe to recruit rebel groups.
The government in place should, therefore, ensure that there is equitable resource distribution.
However much still needs to be done to ensure that the underlying issues of natural resource
conflict are addressed, it is so unfortunate that DRC is almost slipping back into anarchy due
to an unconstitutional regime. The incumbent wants to seek a third term, despite the populace
unwillingness.142
140
Herman, J. C. (2015). The Mind of the African Strongman: Conversations with Dictators, Statesmen, and
Father Figures. New Academia Publishing.
141
World .B. International M. F. and African, D.B. (2000), Can Africa Claim the 21 st Century.
142
Paul. C (1998). On Economic Causes of Civil War, Oxford: Economic Papers.
98
The Governments of the countries where the individuals, companies and financial institutions
that are systematically and actively involved in these activities are based should assume their
share of the responsibility. The Governments have the power to regulate and sanction those
individuals and entities. They could adapt their national legislation as needed to effectively
investigate and prosecute the illegal traffickers. In addition, the OECD Guidelines offer a
mechanism for bringing violations of them by business enterprises to the attention of home
Governments, that is, Governments of the countries where the enterprises are registered.
Governments with jurisdiction over these enterprises are complicit themselves when they do
The Southern African Development Community shared the view of some end-user States that
existing certificates of origin were adequate for demonstrating that products had been legally
produced and acquired. Customs intelligence and investigative capability for combating
smuggling are still being developed within SADC.144 Issues of capacity-building and
information sharing within the region will have to be addressed as this process advances. The
Offices, each assigned to a number of countries, to facilitate the exchange of information and
cooperation within a region. The Democratic Republic of the Congo and many francophone
countries in the surrounding region are attached to the Liaison Office at Douala, Cameroon.
WCO observed that the use of the Liaison Office and the WCO Internet-based Customs
143
Letter dated 8 October 2002 from the Chairman of the Panel of Experts on the Illegal Exploitation of Natural
Resources and Other Forms of Wealth of the Democratic Republic of the Congo addressed to the Secretary-
General
144
Ibid
99
Enforcement Network by the Douala regions members was quite low. It stressed that curbing
communication between the countries concerned.145 With regard to trade flows, the World
Trade Organization have stated that the two provisions of the 1994 GATT, a component of the
WTO treaty, authorize members to take measures that otherwise would be inconsistent with
GATT/WTO rules.146 These rules generally prohibit trade restrictions and discrimination.
Articles XXI (c) and XX describe situations and policy aims permitting exceptional measures.
The former, the security exception provision, refers to exceptions related to a State fulfilling
its obligations under the Charter of the United Nations. This might serve as justification for
Members taking action in compliance with a Security Council resolution on maintaining peace.
The Economic Commission for Africa concurred with Belgium that smart sanctions should
be part of the solution to ending the illegal trade. It added that the Governments of the countries
involved should also be held accountable for the illegal activities of individuals and/or
companies as well as banks that are operating in their country since they have the power to
regulate them.147
In an effort to determine what measures might be taken at the end of the commercial chain to
control the trade in resources of the Democratic Republic of the Congo and sever its links to
the armed conflict, the UN Panel of experts surveyed 17 end-user countries in Asia, Europe,
the Middle East and North America. Many of these countries serve as secondary transit points
and processing centres as well as major consumer markets.148 They included Belgium, China,
145
Ibid
146
Letter dated 8 October 2002 from the Chairman of the Panel of Experts on the Illegal Exploitation of Natural
Resources and Other Forms of Wealth of the Democratic Republic of the Congo addressed to the Secretary-
General
147
Ibid
148
Ibid
100
France, Germany, India, Israel, Japan, Kazakhstan, Lebanon, Malaysia, the Netherlands, the
Russian Federation, Switzerland, Thailand, the United Arab Emirates, the United Kingdom
and the United States. Several European Union members, including France and the
Netherlands, observed that any measures affecting trade flows would have to be taken within
the framework of the European Union and its trade regulations. Belgium and the United
Kingdom stressed that the burden of ensuring transparency in commercial and financial flows
or supply chains should be borne primarily by private companies and should be based on either
voluntary measures or the OECD Guidelines for Multinational Enterprises.149 Germany echoed
this, saying that it had appealed to German companies to adhere to those guidelines as well as
the principles of the European Union Commissions Green Paper on Social Responsibility and
the United Nations Global Compact in their business activities in the region. Germany also
encouraged the Panel to continue its efforts to increase the transparency of the commercial
chains for the natural resources of the Democratic Republic of the Congo, especially by
intensifying its dialogue with private companies. Only Belgium suggested the possibility of
imposing targeted sanctions against businesses or individuals profiting from the trade in
conflict goods. The Netherlands expressed the view that the verification of commodities would
be less difficult and costly if carried out at the beginning of the commercial chain.
Belgium, Germany and the United States also highlighted the re-establishment of the States
authority throughout the territory of the Democratic Republic of the Congo as essential to
combating the illicit exploitation, and the need for capacity-building to help achieve this.
Similarly, Lebanon said that the customs administration of the Democratic Republic of the
149
Ibid
101
Congo should be reinforced so that it could more effectively control borders, monitor trade
Although the international community has made efforts to try and stop conflict finance in DRC,
there is a huge concern that the efforts being made are not adequate and there seems to be some
reluctance in helping the Congolese people. Oxfam criticized the international community in
their 2000 report for ignoring the DRC. When comparing with the response in Kosovo, they
pointed out that in 1999, donor governments gave just $8 per person in the DRC, while
providing $207 per person in response to the UN appeal for the former Yugoslavia. While it is
clear that both regions have significant needs, there is little commitment to universal
Oxfam also noted that the international community is essentially ignoring what has been
deemed Africas first world war. The DRC remains a forgotten emergency. Falling outside of
the media spotlight, and experiencing persistent shortfalls in pledged humanitarian aid, the
population of the DRC has been largely abandoned to struggle for their own survival. It begs
the question whether there is hope for DRC to end the conflict?
In conclusion, DRCs abundant mineral and fuel resources can be an asset in the quest for
inclusive and sustainable development, but researchers and policy experts have come to
recognize that governance is crucial in determining whether resources are a blessing or a curse.
Research into the resource curse initially had a narrow economic focus, but now natural
resources are seen to be linked to broader challenges like consolidating democracy, achieving
accountable and transparent governance and averting violent conflict. Initiatives like the Africa
150
Ibid
151
Oxfam report 2001
102
Mining vision show that regional organizations and policy experts are paying increasing
attention to extractive issues. They portray Africas extractives industries as, at best, lucrative
enclaves that historically have done little to promote industrialization and reduce poverty,
while imposing heavy social and environmental costs. The history, they argue, can be turned
Ever since the 2007 Nairobi communiqu, military responses to the conflict have been
prioritized at the expense of other approaches. The results have been very mixed. Groups
targeted in sweeps often relocate until operations end, then return and attack civilians whom
they accuse of helping state authorities. Military operations against non-state armed groups
may be necessary, but they should be combined with initiatives that offer an alternative and a
future to certain members of these groups, especially those not guilty of war crimes. There is
reason to believe that combatants can be persuaded to step down. The Goma conference
rekindled some confidence among militia groups on away forward. Likewise, during previous
negotiations, the FDLR agreed to denounce the use of force, condemn genocide ideology,
cooperate with the international tribunal on the genocide, and transform itself into a political
party in Rwanda. Offering members of militias reasonable and secure opportunities in their
home countries should be a key aspect in peace efforts. Fostering protection of political rights
and civil liberties, moreover, will undermine the claims of exclusion and persecution that
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Ibid
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4.3 Summary
In conclusion the prospects for peace in the DRC will fundamentally depend on the
development of an inclusive approach that combines the security and economic interests of the
various local and regional actors in the in the region. If communities in DRC are given equal
chances in accessing benefits emanating from mineral resources and also given opportunities
in the national government ultimately peace will return to the country and the Great Lakes
region as a whole.
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CHAPTER FIVE
5.1 Introduction
5.2 Summary
The overriding purpose of this study was to investigate the role of state and non state actors in
fueling conflict in DRC. The Study relied on secondary data and interviews held with
individuals who have vast knowledge of the conflict in DRC. Noting the uniqueness of the
study, finding reliable and available data was difficult especially in the case of idenifying
multinational companies directly fueling the conflict. This was because many companies
involved in the racket do not directly operate in DRC but use shadow companies to do the dirty
work for them. Nevetheless the study was able to draw useful conclusions in support of the
research problem.
5.3 Conclusion
The rampant exploitation of resources in DRC has only been in favor of outsiders and a few
greedy Congolese. Asian and Western companies have had continued booming businesses in
their various industries from techonology to mining at the detriment of Congolese nationals
who many of them do not get to enjoy the high tech innovations that are released each year.
It is eveident from the protracted conflict cycle and insecurity in eastern DRC that the conflict
is increasingly dominated by economic interests rather than political motivations. The sheer
scale of the smuggling and the fact that armed groups receive only a small fraction of these
profits suggests that a largescale transnational organized criminal networks plays a role in
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keeping armed groups active. As established by the study this done to deliberately create an
Based on the research and findings the study affirms its initial hypothesis that DRC conflict
has been instigated and fueled by external forces who are bent on ensuring that DRC remains
unstable to enable the looting and smuggling to continue. The basic tenets of ending conflict
5.4 Recommendations
The fight against conflict finance in DRC must be a collective one. The consumers of high tech
devices and luxury products have a responsbility towards demanding for conflict free products.
By pressuring companies to remove conflict financed products from there supply chains and
demanding for higher standards of products which have been vetted to ensure no invlovement
in conflict finance. This will certainly help remove fuel from the fire by ensuring that
companies are held accountbale for the products they produce and in turn reduce the need to
pay rebels or sign concession rights for future expolitation. It is up to the consumers to put a
lot of pressure on multinational corporations because they are not willing to lose the high
profits they gain from DRC minerals. The study calls for consumers to take a lead and create
a movement that will call for action against conflict mineral products and take a stand or a knee
and not purchase any products that have not been certified to be free from conflict minerals.
The study further recommends that MONUSCO should work hand in hand with the
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government of DRC to establish an effective government that is able to enforce the rule of law.
MONUSCO through its different task forces should support national authorities to be able to
take control of areas that are dominated and controlled by rebels. In addition the mission
together with the international community should continue to advocate for legal and fiscal
Other UN bodies like UNCTAD and UNDP should also play an active role in working towards
ensuring the illegal trade in DRC is stopped and help DRC formulate policies that would help
legalize trade and ensure its done effectively such that it benfits the Congolese people.
In addtion UN agencies should increase their capacity building efforts to ensure previous and
current development projects have been enforced and implemented. Literacy levels in DRC
are at low and agencies like UNICEF and UNESCO with the concerted efforts from the DRC
government should do their level best to ensure education is available for all Congolese
nationals young and old. This will increase the level of civil education among DRC nationals
and eventually see the population have the ability to fight for their rights and work together as
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5.4.3 Recommendations to the Government of DRC
The government of DRC faces many challenges but it is the most important actor in ending the
conflict and utilizing its resources for the benefit of its people. The initial challenge is the issue
of identity. According to several media reports and also from the interviews that the study
undertook, argues that the conflict Eastern DRC is not instigated by DRC nationals but by
Rwandeses and Ugandan rebels. Rumour has it that even Joseph Kabila is not of congoleses
decent. This issues threaten the ability of the president to bring the congoleses people together
as one nation. To ascertain this claims would be a toll order however the government should
make all efforts to reduce the ethnic tension. This can be done by assertivley work with
Rwanda and Uganda to remove all the rebels in hiding and call for reparation of each countrys
The other major issue is the control of the mine areas. The government has been accused of
being too weak in taking control of the mine areas. This has allowed rebels groups to dominate
several areas in Eastern DRC and because the military is shrouded in corruption very little has
be done. The governemnt requires to take aggressive measures and put in place policies and
laws that will provide the military will power to actively support the government and protect
the country. The President need to realign his priorities and firmly work together with other
leaders to put in place proper mechanisms for fighting corruption, ensure there is tranparency
and accountabilty which provides for prosecution of culprits. Reorganize and strengthen his
legislative, judicial and executive arms of government to ensure that they uphold the rule of
law.
The DRC government need to restrategize its diplomatic relations with its neighbours. Perharps
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it is time that hard powere is used to achieve the desired goal. Multilateral talks need to held
with the regional community to discuss ways that they could work together to build DRC in a
way that all parties gain. The African Union should also put pressure on Rwanda and Uganda
to obey thre peace accords and pay all punitive damages as instructed the international criminal
court.
It is evident that the international community looks at DRC as a gem and possibly they cannot
continue to grow their multinational companies without DRCs resources. In the regard DRC
government needs to first invetigate all countries looting minerals and accuse at the ICC. They
should also pay punitive damages for all the harm caused and Belgium should be first on the
list. Once that is done then they should establish talks to discuss ways in which business will
be condcuted in fair and just manner assuming that the government would have done its in
house cleaning and ensured that their were policies and laws in place that governed mineral
trade.
The regional community needs to make a more deliberate efforts to help DRC end the conflict
and retain peace. Heads of state should call for immediate removal of all Rwandese and
Ugandan soldiers in DRC. Sanctions should be placed on whichever government that refuses
to withdraw its troops. The government should also provide amnesty to all Rwandese and
Ugandan rebels that may be hiding in DRC. In addition the regional community needs to
cooperate and fight transanational crime at the international and regional level. Strong policies
should be put in place to ensure multinational coperations engaged in illegal trade are barred
from accessing any minerals from DRC. Policies that will encourage regional trade
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development should be enforced. All African nations are called to come together plan and
agree on ways to utilize DRC minerals for the betterment of Congolese nationals and Africa
as whole. African states should mobilize ways to add value to the raw minerals in DRC so as
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APPENDICES
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Appendix II: Map showing 30 Non-State Armed Groups In Eastern DRC
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Appendix III: Map Showing the Smuggling Routes by Transnational Organized Crime
From Eastern DRC to Criminal Groups, Companies or Individuals in Uganda,
Rwanda And Burundi
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