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11.11.08 Naeems Blog : Disaster Capitalism in Action

Tuesday, November 11, 2008 - If you never understood the concept of Disaster Capitalism, the raging conflict in DR Congo is a textbook case.

More than 80 per cent of the world's coltan is in Africa, and 80 percent of that lies in territory controlled by DR Congo's various ragtag rebel groups, armed militia and its corrupt and underfunded national army. Coltan is a key ingredient in the production of electronic devices such as laptops, personal digital assistant, and mobile phones. Additionally, the country has rich deposits of diamonds, gold, cobalt, timber, and other natural resources.


"the Democratic Republic of Congo has the world’s purest and largest deposits of strategic minerals, including gold, coltan, niobium, cobalt, heterogenite, columbite (columbium-tantalite or coltan), copper and iron. Heterogenite exports coming out of Congo are alone valued at between $260 million (at $20/lb.) and $408 million (at $30/lb.) every month. That’s between 3.1 and 4.9 billion dollars a year. Diamonds account for another billion dollars annually. Oil has been pumping off the Atlantic Coast for decades, but now oil and gas deposits are being exploited from the great lakes border region—Lake Kivu (methane gas) and Lake Albert (oil)—and deep in the province of Equateur. And then there are the dark rainforest woods that sell by the thousands monthly for around $6000 to $12000 per log." [source]

With the re-surge in violence in DR Congo over the past weeks, it presents us with another opportunity to revisit Naomi Klein's Disaster Capitalism.

Basically the theory starts off acknowledging that old-school colonialism is long dead and new-age colonialism (Iraq) is too costly. Thus new ways have to be created to continue feeding the insatiable capitalist system. The newest way is to either wait for a disaster to strike (Katrina, tsunami) or initiate/agitate for one (civil war, invasion) and then send in the economic vultures to scoop up the natural resources at bargain basement prices. The West as well as newcomer China have become masters in exploiting the shock of the victim for their economic gain.

"If the Congo were at peace and able to hold democratic elections, its citizens might gain control over its resources, either by claiming national ownership (as Iran and Venezuela do with their oil) or by regulating the multinational companies that seek to profit from those resources. The violent atmosphere, however, makes it impossible for the Congolese government to challenge corruption within or to exert any authority over multinationals seeking profits. It is thus in the interest of the multinational companies to keep the Congo at war.

And this intentional destabilization is precisely what has been happening. A panel of experts set up by the UN Security Council in 2000 issued a series of reports over the next few years describing how networks of high-level politicians from Congo and neighboring countries, military officers, and business people collaborated with various rebel groups to fuel violence in order to gain control over Congo's resources. For example, in 2002 the UN panel noted that as much as 60 to 70 percent of coltan in eastern Congo was mined under the surveillance of the Rwandan military, using the forced labor of Rwandan prisoners.

A 2003 follow-up report by the panel listed eighty-five multinational companies that had profited from the war in Congo, including six U.S.-owned companies: Cabot Corporation, Eagle Wings Resources International (a subsidiary of Trinitech International), Kemet Electronics Corporation, OM Group, and Vishay Sprague."
[source]

The chaos has not only been taken advantage of by these corporations, but has also been spurred on by them. What is commonly written off as internal tribal strife or a primitive war over land, the complex conflict in central Africa is much more indicting of the western corporatocracy.

By enlisting the services of Rwanda and Uganda, long time allies of the US, to maintain an atmosphere of political instability and civil strife, business interests remain protected.

"Rwanda and Uganda are allies of the United States, some would even say they are client states to US and British interests. Both countries receive financial and military aid from the United States, World Bank and other Western institutions. This aid has continued unabated even during the invasions of the Congo. During a Congressional Hearing in 2001 held by Congresspersons Tom Tancredo and Cynthia McKinney, it was documented by experts under oath that the US provided military aid to Rwanda during its first invasion of Congo in 1996." [source]

"A 2003 United Nations investigation into the illegal exploitation of natural resources accused both Rwanda and Uganda of prolonging their armed incursions into Congo in order to continue their plunder." [source]

Another angle often overlooked in the analysis is that of the contracts signed between multinationals and DR Congo - contracts heavily favoring the corporations.

As stated in this video report by Dan Rather, in 2005 the cash-strapped Congolese government signed unbalanced contracts handing over share of its mineral-rich mines to no less than 60 foreign companies. These deals were so rotten that even the World Bank, themselves notorious for privatizing national resources the world over, criticized their "complete lack of transparency" and stated that the government "may not have received the full value of the mines".

He also reports how the US embassy in DR Congo had a strong role in pushing one of those crooked deals through, involving Arizona-based Freeport-McMoran, one of the largest copper companies in the world. US support didn't just stop there. A US government agency by the name of Overseas Private Investment Corporation (OPIC) supported Freeport with $400million of financing for the projects.

However, those contracts are now under investigation by Congolese president Joseph Kabila.

"In a 2002 report, the U.N. alleged that many foreign mining companies, eager to exploit the lack of a strong central government in Kinshasa and avoid paying fair market value and taxes on the minerals they extracted, signed contracts with commanders from the invading countries as well as with then-President Laurent Kabila, who was struggling to cling to power in the face of the international onslaught. These contracts almost universally favored the mining companies. That is, until May of last year. In a move that sent ripples through the DRC mining community, the government announced that 63 mining contracts, many of them signed during the civil war of the late '90s, would be reviewed by a special ministerial committee." [source]

One wonders whether the current violence in DR Congo has anything to do with the review undertaken by the current Kabila administration of those 60+ mining contracts.

"Kabila’s government has taken the opportunity of a major review of mining contracts to terminate contracts with US, European and Australian companies in favour of Chinese firms. Few companies are prepared to discuss their position in Congo, but those under threat include First Quantum Minerals, Freeport McRoRan, BHP Billiton and Anvil Mining. Vast mineral reserves may be handed over to Chinese firms in the government review." [source]

So folks, be on the lookout for any military intervention sponsored by the UN, the US, or Europe. After all, business interests must be protected.

'Any armed “humanitarian” mission to Congo would be a thin disguise for a naked imperialist intervention that was intent on pillaging the resources of this mineral rich country.' [source]

Antonio Guterres, United Nations High Commissioner for Refugees reminded the world in his January 2008 interview with the Financial Times of London that “The international community has systematically looted the Democratic Republic of Congo (DRC) and we should not forget that.”

Let us not forget that the root of the conflict in DR Congo is not a civil war. It is not local tribes jostling for control of subsurface resources. It is not about redressing injustices carried out in the Rwanda genocide (as justified by Rwanda president Kagame who has 'has vowed to root out the Hutu militias from eastern Congo').

It is a contrived conflict intent on destabilizing the region and shocking the locals while the international community plunders and loots.

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