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from issue no. 07 - 2003

Analysis of a tragic paradox

Bloody resources and distant conflicts

Abundance of natural resources – diamonds, timber, coltan, oil, natural gas, water - in poor countries isn’t a positive advantage for development, as you might expect, but rather a cause of instability, inequality and, often, of militarization and the systematic use of violence

by Francesco Martone and Clarissa Ruggieri

Workers  in a diamond mine in the district of Kono in Sierra Leone;

Workers in a diamond mine in the district of Kono in Sierra Leone;

It’s a paradox: abundance of natural resources – diamonds, timber, coltan, oil, natural gas, water - in poor countries isn’t a positive advantage for development, as you might expect, but rather a cause of instability, inequality and, often, of militarization and the systematic use of violence. It happens that possession of large natural resources constitutes a real trap created by the working of various interests in a dense network of relations on the fringes of legality resulting in endless civilian conflicts. The people with interest are largely the multinational companies, the economic and political lobbies, armed rebel groups and the paramilitary militias.
In his “Breaking the link between resources and repression”, published in The State of the World 2002 by the respected World Watch Institute, Michael Renner claims that at least a quarter of the wars and armed conflicts fought in 2000 was linked to disputes over natural resources, in the sense that their illegal or legal exploitation contributed or aggravated violent clashes or financed their continuation.
In fact the last two decades of the 20th century have been characterized by a radical transformation of the conflicts arising out of the profound changes that have occurred in world geopolitical and socio-economic arrangements, in first place the ending of the Cold War (with its related funding mechanisms to “friendly” countries or rebel groups), but also the progressive erosion of the power of national governments brought about both at government and grass-root levels, and socio-economic globalization accompanied and made possible by free-market economics.
The “new conflicts” take place largely at sub-national level, and are essentially characterized by an increasing privatization of violence, become the prerogative of particular groups protecting their private interests. These are wars in which the exploitation and the illegal traffic in natural resources become the essential means of financing and, in some cases, the very purpose of conflicts designed to enrich individual leaders intent on profiting from the state – and economy - of war. The role played, for example, by diamonds in the Central African Republic in financing the national army and the rebel opposition to the regime is indisputable, while in Sierra Leone, where a decade of conflict has been funded by diamond smuggling, the violence has caused 120,000 victims, half a million refugees and two million evacuees. It is also undeniable that the Liberian timber industry has financed and continues to finance instability in Sierra Leone and throughout the region. With absolute control over the profits from the Liberian timber industry (and from the diamond trade), President Charles Taylor uses a large slice of the proceeds from sale and export to ensure backing for the Revolutionary United Front. When in Angola Jonas Savimbi – leader of the rebel Unita group, and representative of the largest Angolan tribal grouping, the Ovimbundu - rejected the outcome of the general elections of 1992 and restarted the war, he immediately re-established control of the Cuango valley and other areas vital for the control of the diamond mines.
Today there are about 30 million light and small calibre arms circulating in Africa. According to the UN, light arms have caused the death of 20 million people in the African continent alone over the last decade, 80% of whom were women and children. There are over 300,000 child soldiers enrolled today in the various paramilitary militias.
While there is an ever more obvious need to strengthen the system of world governance, restructuring and rationalizing the international institutional architecture, increasing its accountability, broadening its base and increasing checks, it is clear that multilateral agreements are difficult to apply even through the creation of real systems of sanction.
Already at the G8 Kananaskis summit the more industrialized countries launched a plan of action for Africa that focused on the connection between natural resources and conflict, sketching a series of political initiatives aimed at breaking the vicious circle linking the smuggling of light arms, diamonds and timber, the use of child soldiers and mercenary forces, and throwing light on the systematic breach of human rights and the serious social and economic decline of whole regions “guilty” of being rich in natural resources such as diamonds, prized timber or coltan, a resource that has recently become strategic for the high-tech electronics industry.
However the plan is largely a dead letter. While “bloody diamonds” or “conflict diamonds” continue to be used by the rebel forces and by governments themselves to finance warfare and encourage the systematic breach of human rights. Angola, Sierra Leone, Liberia and the Democratic Republic of Congo have gone through long civil conflicts which the diamond trade has served to finance, as well as being a source of personal gain for their leaders. According to Alex Yaersley of Global Witness, in 20% of cases diamonds are traded in illicit fashion (while the diamond trade claims that only 2% of diamonds come from areas of conflict), sometimes contributing to the financing of the conflicts, for example through arms purchases by rebel groups in Africa. Up to today around three million people have died because of wars funded by diamond smuggling.
The problem of the smuggling of rough diamonds in order to fund conflicts has become a subject of prime importance on the agenda of the United Nations, of governments, and of civil and business society. Following the approval of the Resolution on the role of diamonds in armed conflicts in which they declare the wish to break the link now existing between diamonds and war, the United Nations have decided on various measures aimed at controlling the market in diamonds and at preventing the import of arms by countries in conflict.
The creation of an international system of rules for the responsible management of the activities connected with production, with manufacture and trading of the diamonds seems a necessary step in suppressing the smuggling of conflict diamonds. To this purpose the Kimberly process, aimed at developing an international system for setting the minimum international standards for certification in rough diamond trading, plans voluntary regulation whereby those involved in the industry and the international diamond trade will employ their own independent assessors to ensure that the system of guarantees has been effectively set up and is respected in everyday business. This certification process will be subject to check by individual governments.
It is not only with illicit diamond mining and smuggling that private wars are nourished in Africa. “Conflict timber”, the trade which (at any point of the production or commercial process) has been run by armed groups, by rebel factions, regular militias or by civil administrations and their representatives for the purpose of encouraging or of drawing advantage and profit from the conflict, is responsible for all the consequences commonly deriving from smuggling (loss of state revenue, destruction of the stockpile of natural resources, corruption, environmental impact on farming, breach of the human rights) apart from the consequences resulting from the fact that the proceeds of the traffic provide the main funding for the wars. In practice a perverse mechanism is triggered in which armed occupation of the richer lands and uncontrolled exploitation of the resources go hand in hand. The conflict creates a demand for timber, which feeds the conflict, in a vicious circle that feeds on itself till it has exhausted resources.
It should be remembered that on matter of smuggled and “conflict” timber (though there are various agreements that touch on the matter – such as the OCSE Convention against the corruption, the CITES - International Convention against the trade in endangered species - and the commercial agreements underwritten by the World Trade Organization, and by various international organizations such as the UN Forum on Forests, the International Tropical Timber Organization) no specific agreement exists that is effectively trying to deal with it.
Currently the only United Nations action capable of halting the smuggling of conflict timber is sanctions. Additionally, there are, globally, many programs for the sustainable management of forests set up and run by the private sector. The best unofficial results have been obtained by the Forest Stewardship Council, promoted by the timber industry and the NGOs. These agents have played a key role by putting pressure on governments to take concrete action. Furthermore, according to the WWF, about 700 companies that produce and use timber have joined the Global Forest and Trade Network that wants to spread a system of eco-sustainable certification, and that has so far certified 20 million hectares of forest spread over 35 countries. But the figure is still very small since it covers no more than 3% of the world’s forests. The NGOs that deal with forestry policy are increasing in influence and capacity to exert pressure on governments. Apart from individual cases, however, the action backed by the NGOs on the international level doesn’t specifically concern the problem of conflict timber but deals with it in the wider context of timber smuggling, understood as a hindrance to the effectiveness of the action taken for the sustainable management of forests. What the NGOs and the private sector may be able to do in the fight against conflict timber remains unexplored.
Nevertheless, the premises for concerted action – involving the people directly interested and respecting the laws of the marketplace - already exist, as do valid models such as that of the “Kimberly Process Certification Scheme” for conflict diamonds.
To conclude, the policy required to break the link between natural resources and conflicts should emerge from within a sphere of regulation so far ignored, the triangle whose nodal points are international commerce, aid for development, and security. These in fact are three spheres of policy all of which have a direct impact on the problem but which currently move on separate lines without taking advantage of possible synergies. In particular, international commerce and security are two fields of action that should take the leading role in putting an end to the funding of conflicts through the smuggling of natural resources.
The current system of global environmental governance is in fact inadequate to deal in co-ordinated and effective fashion with the problem of the financing of conflicts through expropriating and trading in natural resources. The working out of a specific regulation aimed at controlling international commerce on grounds of security, a project consented by clauses XX (a) and XXI (c) “conflict exclusion” of the GATT (General Agreement on Tariffs and Trade), suggests an interesting possibility for the design of new proposals. The central role that the WTO can and must play in the fight against the financing of conflicts by trading in natural resources, in collaboration with the other bodies involved, must be forcefully encouraged and backed.
Finally, the interministerial meeting of the World Trade Organization, to be held next September in Cancun in Mexico, could be an important opportunity for taking the initial steps towards constituting a working group with the United Nations for the finding of means to control and prevent trade in conflict resources, setting them within an organic approach along with the relaunch of policies of international cooperation and the construction of models for the regulation of the economy and finance. It is also on these matters that the real political intention of governments and international corporate body will be measured, their willingness to deal with the causes that are at the root of the forgotten conflicts of the planet, in which, though maybe indirectly and often unconsciously, the responsibilities of business and consumers in the wealthy countries play an obvious and serious part.

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