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Global Communities Partners with Fair Congo, IMPACT, and Levin Sources on USAID-funded Initiative to Support Responsible Sourcing of Gold from Eastern Democratic Republic of Congo
Published 01/31/2019 by Global Communities
Global Communities announced today a new partnership with the United States Agency for International Development (USAID), Fair Congo Sarl, IMPACT, and Levin Sources to establish a commercially viable, conflict-free artisanal and small-scale mining (ASM) gold supply chain originating from eastern Democratic Republic of the Congo (DRC). The five-year, $11.9 million program funded by USAID builds on recent successes achieved by donor-funded initiatives to export responsibly produced gold to jewelry buyers in North America and Europe.
According to the DRC mining law, artisanal miners are required to be members of a cooperative to engage in legal mining activities in designated artisanal mining sites. While some ASM cooperatives exist currently, many tend to exist in name only and not in function. This initiative will strengthen ASM cooperatives by examining their business and governance structures and creating the necessary commercial incentives to ensure that they can sustain operations independently without continuous donor funding. Moreover, this project will actively seek partnerships with the private sector with a goal to achieve at least $4 million of investment into the project-supported supply chain.
The initiative aims to reduce instability in the DRC – which has more than 1,100 minerals worth nearly $24 trillion – by providing commercial opportunities to artisanal miners by linking them to responsible gold buyers in international markets. Artisanal gold is a key source of income for armed groups and criminal networks in the DRC. It is one of its most commonly smuggled resources; more than 95 percent of artisanal gold mined in the DRC is smuggled into adjoining countries. Miners in the DRC extract up to 16 tons of artisanal gold each year, but 1-2 percent is exported legally.
Global Communities, along with our partners will improve governance and business operations of ASM gold cooperatives. IMPACT will support the ASM gold cooperatives in implementing the traceability and due diligence required by regional and international standards; Fair Congo will contribute to the increase in exports of conflict-free, traceable ASM gold from eastern DRC; and Levin Sources will manage increased demand and co-investment in conflict-free, traceable ASM gold in the supply chain through targeted private sector engagement. The current initiative will better align mining practices with international and regional standards. Improved traceability and due diligence is critical for the industry; it has presented serious challenges, particularly for small-scale miners with limited or even no equipment and minimal organization.
“This initiative is a natural fit for Global Communities with our vast experience bolstering livelihoods and protecting the most vulnerable through cooperatives in conflict zones around the world,” said David A. Weiss, President and CEO of Global Communities. “It’s a wonderful opportunity to apply our successful cooperative model in a conflict area with an abundance of minerals.” The initiative will provide linkages to buyers from Asia, Europe and the US.
Currently, it is cheaper to buy gold through illicit channels than legal ones; local traders are willing to purchase gold at higher prices, and then smuggle it out illegally and avoid taxes, making illegal trade highly profitable. This new initiative will strive to provide commercial incentives for mining and exporting gold responsibly, in compliance with OECD Due Diligence Guidelines for Responsible Supply Chains of Minerals from Conflict-Affected and High Risk Areas. The initiative also contributes to the broader USG strategy to address linkages among human rights abuses, armed groups and the mining of conflict minerals in the Great Lakes Region of Central Africa by requiring disclosure of publicly traded companies about where they source minerals.
ABOUT GLOBAL COMMUNITIES Global Communities is an international nonprofit organization founded in 1952 that works closely with communities worldwide to bring about sustainable changes that improve the lives and livelihoods of the vulnerable. Learn more at www.globalcommunities.org.
ABOUT FAIR CONGO
Fair Congo is a social enterprise, funded by US impact investors, into responsible natural resource management. Fair Congo is the first American-owned company to be granted an export license for ASM gold in the country, and the first and only exporter in the region to conform to the ‘OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas’ and LBMA’s Good Delivery standards.
IMPACT, formerly Partnership Africa Canada, has been transforming how natural resources are managed in areas where security and human rights are at risk for over 30 years. IMPACT investigates and develops approaches for natural resources to improve security, development, and equality. They are an independent non-profit collaborating with local partners for lasting change. Their Just Gold project in northeastern Democratic Republic of Congo is the first to bring traceable, legal and conflict-free artisanal gold from the country to international markets.
ABOUT LEVIN SOURCES
Levin Sources is a social venture and consulting firm specializing in responsible mining and sourcing, by leveraging research, strategy, and convening power. Levin Sources has extensive experience in ASM, working with the private sector, governments, and civil society across sub-Saharan Africa, Europe, and North America, including many projects on gold supply chains in the DRC.