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Responsible supply chains

What impacts do EU regulations have in our partner countries?

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25.01.2021 |

This is the question that the Extractives for Development (X4D) Sector Programme asked itself with the coming into force of the EU Conflict Minerals Regulation

The regulation on trade of raw materials from conflict-affected and high-risk areas (CAHRAs), adopted by the European Union in 2017, aims to break the link between raw material extraction and conflict financing. Since 01.01.2021, the import of certain minerals, namely tin, tantalum, tungsten and gold, is regulated by law across Europe: Importers of these raw materials must then prove that they comply with corporate due diligence and thus do not contribute to human rights violations and conflict financing. But what developmental impacts does the regulation have on affected mining countries?

In order to analyze this, the BMZ division 422, together with the business association Responsible Minerals Initiative (RMI) invited to a virtual conference. The goal of the event was to identify opportunities and risks of the regulation and to develop recommendations for action to promote an effective implementation in the coming years. In addition, the focus was on networking between different stakeholders along the entire raw materials supply chain. Exchange formats like this are essential to identify the impact EU regulations can have on companies and producing countries, so that possible important information gaps can be closed.

With 715 participants, the conference attracted great interest. The audience included numerous representatives from partner countries (DRC, ICGLR), multilateral and international organizations (World Bank, IGF), civil society and companies from the automotive, raw materials and technology sectors.

"One company alone can improve its internal due diligence systems. But to achieve sustainable positive change in producing countries, we need partnerships!" With these words, PStS Barthle opened the digital conference. The importance of partnerships was also emphasized by the Minister of Mines of the Democratic Republic of Congo and the Secretary General of the Conference of the Great Lakes (ICGLR) in their video messages.

On the second day of the conference, the Extractives for Development (X4D) Sector Programme organized interactive breakout sessions. These focused on the regulations impact on small-scale mining, gender equality, governance and illicit financial flows. Participants formulated recommendations for action for governments, civil society and the private sector.

In a large final round, these recommendations were passionately discussed by EU parliamentarians Bernd Lange and IuIiu Winkler as well as representatives of the European Commission (Madelaine Tuininga DG Trade & Cécile Billaux DG DEVCO). The conflict minerals regulation was spontaneously renamed responsible minerals regulation.

Participants' recommendations for action ranged from concrete proposals for supporting local actors to recommendations for the EU: "Follow through on the conflict minerals regulation with robust diplomacy and teeth". Companies were advised to strengthen their commitment to sustainability along the supply chain in multi-stakeholder initiatives. The new EU regulation shall not exclude countries from global supply chains, but ensure that also vulnerable actors along the entire supply chain can benefit from the opportunities of raw material extraction.

The conference underlined the need for exchange formats that enable an open discussion on legal requirements for due diligence in industrialized countries and their actual effects in countries at the beginning of value chains. As a sector programme and German cooperation in general, we can actively promote this exchange.

For further information please contact Hannah Maul or Janne Kaiser-Tedesco.

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