Gold to Bullets: How Armed Groups Profit from Gold Trafficking in Eastern Congo

A new report puts the spotlight on Africa’s conflict gold

Gold to Bullets: How Armed Groups Profit from Gold Trafficking in Eastern Congo Gold to Bullets: How Armed Groups Profit from Gold Trafficking in Eastern Congo

Uncategorized October 12, 2013 0

Gold mined in eastern Congo. Flickr User Image Journeys photo Gold to Bullets: How Armed Groups Profit from Gold Trafficking in Eastern Congo A... Gold to Bullets: How Armed Groups Profit from Gold Trafficking in Eastern Congo
Gold mined in eastern Congo. Flickr User Image Journeys photo

Gold to Bullets: How Armed Groups Profit from Gold Trafficking in Eastern Congo

A new report puts the spotlight on Africa’s conflict gold

On Feb. 3, 2011, a small business jet touched down on the lone airport runway serving the Eastern Congolese city of Goma. The city, which sits near Rwandan border, is known worldwide for its enormous refugee camps and status as a hotspot for rebel activities.

The passengers disembarked, and handed metal cases containing $6.5 million in cash to a group of armed men wearing battle fatigues of the Congolese army. The men promptly packed the cash onto military vehicles and drove off to the private compound of their commanding officer, Gen. Bosco “The Terminator” Ntaganda. Not exactly subtle.

Next, his soldiers returned to the plane bearing cases containing about 450 kilograms of gold — an amount worth more than $18 million at today’s rates. But then the deal went south. Before the plane could take off, more government soldiers arrived, impounded the gold and arrested the passengers of the plane — which included a wealthy Houston oil tycoon.

Ntaganda was already infamous for his alleged brutality as a rebel commander in the province of Ituri, which earned him an arrest warrant from the International Criminal Court in The Hague, where he is now awaiting trial.

As one of the commanders of the Rwanda-aligned rebel group CNDP, he led a mutiny against a former commander, and integrated the CNDP into the Congolese army while conserving a parallel chain of command — which allowed him to build a vast network of legal and illegal business interests around his newfound military influence.

Ntaganda later claimed that he was working with Congolese troops on a sting operation, but that is highly unlikely. How many other cash-for-gold deals the rebel commander has struck will also likely never be known with certainty. However, a new report by U.S. advocacy group The Enough Project sheds some light on how rebel groups and commanders like Ntaganda used the trade of the precious metal to make fortunes and finance their armed struggles.

Fighters of the M23 during their occupation of Goma. U.N./Sylvain Liechti photo

The M23 runs Bartertown

Ntaganda’s relationship with the government of the Democratic Republic of the Congo was, at best, complicated. After spending time at the top of the CNDP and being friends with the Congolese army, he once again went rogue in 2012.

Many of the troops in the CNDP followed Ntaganda, having been more loyal to him than the government. The rebels also adopted a new name: M23.

Fast forward to today, and the M23 controls a relatively small stretch of territory in Eastern Congo, despite taking control of Goma at one point after the split with the government. To finance their operations, Ntaganda relied on established business contacts and struck alliances with other armed groups in neighboring provinces — who controlled access to lucrative gold mines.

According to The Enough Project, this transformed the area controlled by the M23 into a gold trading hub from where Ntaganda managed exports to neighboring Uganda and Burundi. In total, the advocacy group estimates that around $500 million worth of gold are now illegally exported from Eastern Congo by the M23 and other armed groups every year. Not bad for a small-time rebel group.

But Ntaganda wasn’t able to enjoy these profits for long.

Another internal coup carried out in Feburary this year — and led by M23 military leader Sultani Makenga — drove Ntaganda out of the organization. Ntaganda feared for his life. He turned himself in to the American embassy in the Rwandan capital Kigali, which promptly transferred him to The Hague to await trial for a range of war crimes committed during his illustrious career as a war lord.

The M23, meanwhile, continues to profit from the illicit trade of Congolese gold, with Makenga now taking the helm.

Weapons seized from rebels in the Democratic Republic of the Congo. U.N./Sylvain Liechti photo

But the money isn’t the real problem

The report makes several recommendations to limit the use of gold as a method of financing armed rebellions in the Congo, mainly by introducing legislation comparable to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, which requires companies to report if their products use “conflict minerals” like tin, tungsten and tantalum.

But apart from the fact that gold is inherently more difficult to regulate, because there are huge non-industrial markets available for the metal in the jewelry markets of Middle Eastern and Asian countries, the organization also rightly points out that the illicit gold trade is more of a symptom than a cause of violence in the Congo.

For one, gold is popular because the trade is weakly regulated and prices on the world market are still close to historic highs, despite some losses over the last few months. Global attention on the trade of tantalum and tungsten also led a shift to alternative sources of revenues. But getting the trade of gold under control is neither completely achievable, nor would it leave armed groups without alternatives.

Another well-established strategy of raising money for military campaigns in Eastern Congo include growing and trafficking marijuana, in addition to raising levies at border crossings and important crossroads — in addition to introducing elaborate taxation systems in areas controlled by a given armed group. Ntaganda’s predecessor, Laurent Nkunda, was known to be heavily invested in cattle and to run protection schemes for other cattle raisers in the area.

Lastly, some rebel groups like the M23 are also quasi-proxy forces of other countries, with recruits, training and weapons provided by a myriad of friendly governments.

Cutting of one source of revenue will likely inconvenience those actors involved in the trade — and is the morally right thing to do — but a long-term settlement of the conflict has to be found at the negotiating table, involving local communities and their grievances, as well as regional power brokers.

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