Transcript RULE OF LAW
MONUC
Global Forum V
Hot spots: non state sectors
vulnerable to corruption
The DRC Context
– History of colonial exploitation and
dictatorship;
– Emerging from/struggling with conflict;
– fledgling democracy;
– Weakened and dysfunctional institutions
and limited extension of state authority, in
a vast geographic territory (2,345,410 sq. km
bordering 9 countries);
– Collapsed justice system
– Extensive natural resource wealth.
Natural Resources in the DRC
Natural Resources:
Coltan (cassiterite), copper, gold, silver, diamonds,
niobium, tantalum, zinc, manganese, tin, uranium
50% of Africa’s hardwoods
10% world’s hydro-electric capacity
(Source: UN Reports)
Mining:
1980 – generated 66% budgetary receipts
1990 – export receipts = 1 billion USD
– 465,000 tonnes of copper
Today – no significant contribution to budget
– 20,000 tonnes of Copper (2006)
(source: Programme du gouvernement 2007-2011)
Extractive industries in the DRC
“IF THE DRC IS TO EMBARK ON A
PROCESS OF RECOVERY, IT WILL
HAVE TO RELY ON THE
GENERATION OF STATE
REVENUES FROM EXTRACTIVE
INDUSTRIES” (s/2007/68)
Extractive industries - challenges
Limited extension of state authority creates
vacuums (imposed “taxes”)
Corporate entities engage “protection forces” who
extort payments from local populations
Government troops at border often complicit (note:
many elements of the FARDC are not paid on a
regular basis and only receive minimal salary)
Limited technology/investment required and
desperate, unskilled labour easily exploited
Parallel systemic corruption
Extractive industries - challenges
Formal sector undermined by vulnerability to interference
from military elements, rebel groups, foreign interests and
unscrupulous traders – allegations of protection by DRC
personalities;
State mining companies unable to protect concessions,
enabling unregulated diggers
Vast wealth both a source of financing for armed groups,
and also a motive to continue
Corruption and mismanagement – resulting in large
majority of sales and exports outside authority of state
Legitimate, conscientious mining companies, comptoirs,
négociants, find it impossible to compete
Illegal Exploitation of Natural Resources:
Non-State Actors
Artisanal miners
_____________________________________
Economic operators violating Congolese law:
(potential targets of UN sanctions)
Middlemen – buyers and traders engaged in fraudulent
activities (subcontractors, négociants, comptoirs/
exporters)
Mining companies
_______________________________________
Artisanal Miners
2 million artisanal miners
Subsistence income at best – often in debt
Required to pay string of charges – i.e. local
chief, unintegrated FARDC elements,
mining police, de facto authorities
Subjected to intimidation and violence (armed
gangs – suicidaires – 38 deaths registered by HR in Kasai Oriental
2006)
Other non-state actors
Fraudulent exporters or comptoirs
– buy most cassiterite at prices legitimate exporters cannot afford
– Cassiterite exports undervalued by 50-60-%
– control of cassiterite estimated 70-75% or more
– None contribute to the building of formal sector
– 80-90% of gold exported fraudulently (8 million USD/month)
– 40% diamonds exported illegally; large portion sold by négociants
with no fees paid
– Hire and exploit children
– Tax evasion
– Corrupt payments
(Source: estimates quoted in S/2007/60)
Corrupt economic operators
illegal activities
– Fraud
– Use of armed groups to secure access to
concessions and/or to extort payments from
miners
– Tax evasion
– Corrupt payments to officials
– Smuggling
IS THERE JUSTICE IN THE DRC ?
ACCESS TO
CIVILIAN
JUSTICE
60 of 180 required first
instance courts are yet
established
Less than half of the
required 5000
magistrates
Total dilapidation of
existing court,
prosecution- and
detention premises,
especially in the interior
of the country
ADMINISTRATION OF
JUSTICE
CIVILIAN & MILITARY
Courts
Existing critical mass of
competent jurists,
desiring reform,
retraining
Lack of basic equipment
Absence of case tracking
leading to excessive
detention, archives,
case law
Interference/
pressure from
government officials
Alleged corruption – lack of
confidence of
population
Need for national training
capacity
ADMINISTRATION OF
JUSTICE
Prisons
Starvation deaths - 1/145
prisons has budget for food
No high security facility
Abuse of authority leading to
unlawful detention
Crumbling and non-existent
walls, inadequate surveillance,
resulting in:
escapes
regular assault and rape
overcrowding
inability to accommodate serious
offenders
risk of creating flash-points for
violence
Children, women, military, militia,
all detained in the same facilities
URGENT NEEDS
Legislation
High security military detention facilities
Court and prison facilities (infrastructure)
Food for prisoners
Increase number and rank of military prosecutors and judges
Increase in support staff
Technical assistance (material needs and expertise) to provide immediate national capacity
required to investigate, prosecute and administer justice, including in regard to serious human
rights abuses
Support for development of independent “watchdogs” (counterbalances), i.e. regulatory bodies,
media, independent NGO’s, etc)
Support for the development of state capacity to provide intra-governmental human rights
guidance and sensitization (i.e. Ministry of Human Rights)
Support for development of sustainable national training programme and institution(s)
Extractive Industries - Reports
NATIONAL
Lutundula Commission (February 2006)
INTERNATIONAL
UN Panel of Experts– reports on illegal exploitation of
natural resources (2001-2003)
UN Group of Experts monitoring the arms embargo –
report to Security Council on feasible and effective
measures to prevent illegal exploitation financing
armed groups (res 1698 of 2006)
UN Secretary-General – report to Security Council (8
February 2007, pursuant to res 1698 of 2006 – currently the subject of
informal debate)
Lutundula Commission
Set up by the peace accords of 2003
Lutundula Commission included representatives
from all major parties to the conflict
Highly controversial: allegations of withdrawing
names, not dealing with important actors, certain
sectors not included – no follow-up (electoral period)
Sent a signal to companies that they could be
exposed – naming and shaming
Lutundula Report
Investigated 50 mining contracts signed during the
conflict
Found that dozens of contracts were either illegal
or of limited value for the development of the
country
Recommended that 16 contracts be ended or
renegotiated
Recommended that 28 Congolese and
international companies be investigated for
violation of Congolese law
Recommended that 17 persons be prosecuted for
crimes including fraud and theft.
Implications of sanctions in
extractive industries
On armed conflict – financing armed groups
Artisanal miners – sanctions likely to affect
them most severely – livelihood security
issues
Impact on/of existing (corrupt) trading
system – mushroom effect (cut one, another
grows in its place)
Conclusion: Sanctions may not be the answer
(under consideration)
Addressing illegal exploitation
Recommended governmental reform initiatives:
Reinforce/build institutions capable of promoting legitimate trade,
reducing criminal involvement and raising public revenues (regulatory
bodies, security sector)
Extractive industries transparency initiative (Min of Plan supporting
technical committee with a view to implementation)
Recommended non-state initiatives:
Organize producers to create mechanisms to promote social
development
Engagement to respect best practices through voluntary principles,
code of conduct, and respect for rule of law
Recommended regional initiative: a cross-border commission to stem
fraudulent exports (requires viable national counterparts, i.e. justice)
Attacking Corruption
Culture:
• Integrity vs. Corruption – long-term vs. short-term
• Regaining public trust through participation, consultation
- fostering perception of integrity
Political will:
• Creation of personal and corporate risks to engage in
corruption – judicial, administrative, regulatory, financial,
and economic sanctions
What future?
DRC Government Programme 2007-2011
JUSTICE AT THE FOUNDATION OF REFORMS – SINE QUA NON
– Calls for restructuring public enterprises and a mechanism for monitoring
the execution of mining contracts
– Proposes reform that will include transparency, increasing revenues, as
well as environmental and social sustainability
– Recruitment and deployment of consultants to assist DRC mining officials
to conduct inspections
– Publication of key elements and analyses of partnership agreements, and
the renegotiation of agreements as required
– Adoption of a business plan and reform programme for Gecamines and
short-term reform programmes for other public enterprises;
– Adoption of transparent procedures for awarding mining rights (exploration
or exploitation)
– Political will, including justice reform, together with private enterprise
support are key for executing the government’s plans.