AMC threatens to quit Congo in row over 'rebel links'

The lucrative trade in Congolese tin has become embroiled in a political struggle between a London metals merchant and a campaign group over the tin trade’s failure to prevent warlords in the Democratic Republic of Congo from profiting from tin mining.

AMC, a leading trader on the London Metal Exchange, has suspended purchases of cassiterite (tin ore) from Congo after Global Witness, an advocacy group, accused the trader of buying tin from middlemen who deal with rebel groups.

In response to the criticism, AMC said that Thaisarco, its tin smelting subsidiary in Thailand, which purchases tin ore from Congo, would not enter into further contracts with suppliers unless it had the support of the United Nations and campaign groups for a certification scheme. After a UN report last year on illicit trading by rebel groups in Congo, Thaisarco began to develop a certification scheme with ITRI, the tin industry organisation, aimed at verifying the origin of shipments of tin ore.

Congolese tin mining is a cottage industry. The tin mines in North and South Kivu, remote eastern provinces of Congo, are worked by hundreds of thousands of artisanal miners using picks and shovels. A single container load of ore could be sourced from 10,000 miners.

Militia groups, including the FDLR, which is linked to the Hutu extremists involved in the genocide in Rwanda, continue to profit from the mineral trade in eastern Congo through extortion and coercive taxation. Tiny quantities of ore are sold and consolidated through a daisy chain of négociants, middlemen who sell to a government-licensed comptoir. According to the UN report and Global Witness, one of these merchants — Panju — is dealing in rebel tin.

AMC says that it would rather continue to buy tin from Congo while improving its certification system but that it would not renew its contracts without the support of the UN. According to the World Bank, there are as many as two million artisanal miners in Congo, an industry that is supporting more than 12 million people.

Harold Sher, chief executive of AMC, admitted that the certification system was imperfect but said that the company needed time to develop procedures to go beyond the comptoirs.

“We have led the due diligence,” he said. “No other initiative has been started. Unless the UN endorses [the ITRI certification system], we cannot go back in.”

Giles Robbins, chairman of Thaisarco and a director of AMC, said that a de facto ban was starting to take hold. “Customers are saying we don’t want your tin if it is of DRC [Congolese] origin. What we need to resume trade is the clear and unequivocal support of the UN for the ITRI regime.”

A further risk is that a ban would make the trade even less transparent. Congo accounts for between only 5 and 7 per cent of the world’s tin supply and traders have alternative sources of supply. A fifth of Congo’s tin is bought by Chinese and Indian companies and some of these may be less interested in promoting certification procedures.

“The trade will deflect into less transparent hands,” Mr Sher said.

AMC’s threat to pull out of Congo appears to have surprised Global Witness, which is resuming discussions with the company. A spokesman for Global Witness said that it would rather that AMC continued to buy Congolese tin.

The spokesman added that AMC could do more to verify the source of its ore by having a presence on the ground. “It is common knowledge who is controlling the mines. We don’t believe it is that difficult. We feel they are shirking their responsibilities.”