Conflict-Free Smelter (CFS) compliance
We are pleased to announce that Malaysia Smelting Corporation Berhad (MSC) is CFS-compliant and can therefore smelt the material sourced through the Conflict Free Tin Initiative.
Throughout the security tensions related to the rebel group M-23 in North Kivu in 2013, the Kalimbi mine in Kalehe South Kivu, remained open and operational. There was heightened monitoring of the security risks and this process has involved all actors. The local and provincial multi-stakeholder committees played a key role, meeting regularly and, at the request of the iTSCi Governance Committee, put in place contingency plans to suspend tagging if there was any direct risk that would compromise the integrity of the system. Fortunately it was not necessary to put this plan into action. There were also significant disruptions to the local population caused by the insecurity with a large camp for displaced persons established in the nearby town of Nyabibwe. Some 3,000 families fled the fighting and established a camp in the more secure zone around Nyabibwe. Since the end of 2013, rebel activities in North Kivu have ceased and the security situation has improved in the region.
This initiative proved that due diligence and traceability are possible, even in the most difficult of circumstances. When it was discovered that a colonel of the national army traded in untagged minerals from the same mine, he was transferred to another area and could not resume his illegal trade. A government official was caught selling tags, he was apprehended and penalized. Incidents such as these are to be expected, especially in the DRC. The fact that incidents are remedied by local actors means that not only the traceability system work and is robust, but also that local capacity for conflict resolution is being built.
Production at the Kalimbi mine in South Kivu has been problematic due to lack of equipment, flooding, poor grade of minerals and impurities in the ore. The mine has been operating below-par in recent months due to lack of local investors who can assist with up-grading the mine infrastructure and mechanization. Nonetheless, the mine still provides the livelihoods for several hundred miners and their families. The expansion to Maniema offers greater potential for higher quality production and volume. Potential for production in North Kivu is also being investigated.
Production is typically the joint effort of a team of miners working together. In some cases the transporters, crushers and mineral washers are also part of the team, though in other cases they may be independent workers who are paid at an agreed rate per sack transported or processed. The price paid for the minerals by the trader (négociant) will typically be paid to the team leader who will cover operating costs (equipment, fuel, taxes, etc.), will pay any independents the fees they are due, will take a share, and will then divide the remainder amongst the team members (and this division may be on the basis of experience, hierarchy within the team, etc.).
CFTI has achieved ‘proof of concept’: through the iTSCi programme, it is possible to provide a supply of conflict-free minerals to the international market, from even the most volatile and complex sites in the DRC.
However, the sustainability of the model depends on scale and, at present, the system is limited to a relatively small number of mines. This is why the CFTI is expanding to new mines to bring more production and more miners into the system. Scaling-up as we are doing in Maniema is based on the practical and invaluable lessons learned during the CFTI pilot.