Leaked Trump Executive Order Would Let US Companies Trade in ‘Blood Diamonds’
The Trump administration has drafted an executive order suspending regulation of the trade in conflict minerals, including “blood diamonds,” which have contributed to tremendous death, destruction and suffering throughout Africa.
The Guardian has obtained a copy of a leaked draft executive order prepared last week that would implement a two-year suspension of Section 1502 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, requiring US companies to guarantee their products contain no minerals mined in the Democratic Republic of Congo (DRC) or neighboring nations. Reuters reports “sources familiar with the administration’s thinking” confirm President Donald Trump’s consideration of the order.
The proposed order cites corporate profit and jobs as justification for lifting the due diligence requirement. “In addition to lost livelihoods associated with the Conflict Minerals Rule, the SEC (Securities and Exchange Commission) also estimated in 2014 that American companies would be forced to incur upfront compliance costs of $3 to $4 billion, with $200 million per year thereafter.”
The order claims to be rooted in concern for human rights in DRC. However, human rights groups expressed great concern that it would have the opposite effect. “This law helps stop US companies funding conflict and human rights abuses in the Democratic Republic of Congo and surrounding countries,” Carly Oboth, a policy adviser at the international rights organization Global Witness, said. “Suspending it will benefit secretive and corrupt business practices. Responsible business practices are starting to spread in eastern Congo. This action could reverse that progress.”
The draft does require the replacement, within 180 days, of the due diligence requirement with a new human rights plan targeting companies that engage in illegal activity. Human rights advocates, however, expressed skepticism that such efforts would curb abuses.
Conflict minerals, which in addition to jewelry are used in products ranging from airplanes to computers and mobile phones, have fueled armed conflict in DRC — where millions of people have been killed, maimed and displaced in the worst conflict since World War II — and other African nations. In addition to diamonds, gold, coltan, tin, tantalum and tungsten have funded insurgencies and other violence in the region. Efforts to combat trafficking in conflict minerals have been opposed by capitalist interests who critics say are more concerned with profit than with the enormous suffering inflicted upon countless millions of Africans as a result of their greed.
Human rights advocates say the cost of complying with Section 1502 of Dodd-Frank, as cited in the leaked Trump order, are significantly overestimated by industry lobbyists. The independent environmental consulting firm Claigan estimated Dodd-Frank compliance cost around $140 million in 2014, a fraction of the SEC estimate of $3-$4 billion cited in the proposed executive order.