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CHAPTER ONE Mineral Resources, Their Use and Their Impact on the Conflict and the Country

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CHAPTER ONE Mineral Resources, Their Use and Their Impact on the Conflict and the Country CHAPTER ONE Mineral Resources, their Use and their Impact on the Conflict and the Country Introduction 1. The management of state resources is central to the quality of governance in any country. This is particularly the case in Sierra Leone, a country whose economy depends essentially on revenues from its mineral resources. The Commission deemed it important to examine how mineral resources were used by successive governments and how they may have contributed to the war. Furthermore, the Commission set out to explore the extent to which the combatant groups exploited mineral resources to sustain themselves and replenish their war-making supplies. 2. Despite its huge mineral resources, Sierra Leone has remained one of the poorest countries in the world.1 Extensive alluvial and kimberlitic diamond deposits, as well as bauxite, rutile and gold, are found in the east and the south of the country. Gold, iron and more recently bauxite have been discovered in the north. Iron ore at Marampa was a major foreign-exchange earner until mining there was closed down in the mid-1990s. In the past, these resources have benefited a small elite group of Sierra Leoneans as well as Lebanese, Senegalese, Gambian, Guinean and Nigerian traders and a sprinkling of other groups from the sub-Saharan region. 3. The most important mineral resource in Sierra Leone is diamonds. This chapter will focus predominantly on diamonds and refer to other minerals where appropriate. 4. Throughout the world, diamonds are objects of desire and admiration. In Sierra Leone, diamonds were indirect causes and fuelling elements of the war. The misuse of diamond resources in an essentially single-product economy like Sierra Leone’s has created huge disparities in socio-economic conditions. While the elite and their business associates in the diamond industry have lived in grandeur, the poor have invariably been left to rue the misappropriation of the collective wealth. 5. As a national resource, diamonds have been controlled and exploited largely by a non–Sierra Leonean community, the Lebanese, who have formed and maintained new centres of economic power in the country. 1 Sierra Leone has ranked in last place out of more than 170 countries on the UNDP Human Development Index for the last three successive years from 2002 to 2004. Vol Three B Chapter One Mineral Resources Page 3 6. In the context of the Sierra Leone conflict, diamonds were highly coveted because they yielded tremendous revenues, which would enable the armed factions to procure additional weapons and ammunition. Possession of weapons conferred power upon the armed parties, as they could capture large areas of territory, which could in turn be exploited for economic purposes. The desire to expand “control areas” into parts of the country ripe for economic exploitation gradually became the main motivating factor for all the armed groups and many local commanders, thus triggering further conflict. 7. There is a widely held belief in the western world that the conflict in Sierra Leone was initiated and perpetuated because of diamonds, the country’s most important mineral resource. According to this version, the RUF, backed by Charles Taylor and the NPFL, initiated an armed rebellion in Sierra Leone to gain control of its diamond resources. In the years following the initial attack, it is alleged, the proceeds from an illicit diamond trade enabled the RUF to finance its war effort through the purchase of weapons abroad. 8. On the basis of its research and investigations, the Commission views this version of the conflict as simplistic. It fails to capture numerous complexities, the reasons for the decay of the state in Sierra Leone and the role minerals played prior to and during the conflict. It also does not reflect what unfolded on the ground in Sierra Leone. There were multiple causes of the conflict and reasons for the involvement of Liberian and other foreign actors. Although it is true that the RUF partly financed its war effort through diamond trafficking, diamonds did not yield significant revenues for the movement before 1997. 9. Using primary data gleaned from interviews, statements and hearings, along with secondary materials from reports issued by NGOs and international bodies such as the United Nations, the Commission will address the following issues in this chapter: • the political economy of mineral resources in Sierra Leone; • the role minerals played in the conflict, including their appropriation and use by armed factions; • the role of internal and external actors in the mining industry and its implications for the war; • the systematic targeting of communities in mining areas and the effect of the conflict on those communities; • government policies regarding the mining industry and their effect on the country; and • the weaknesses of the international diamond industry and the effect of the Kimberley Certification Process. 10. The Commission has divided the Sierra Leone conflict into three phases.2 This chapter begins by examining the pre-conflict years with a view to setting the context for the conflict. Thereafter, the three phases are analysed as follows: first, the period of conventional “target” warfare from 1991 to late 1993; second, the guerrilla warfare phase from late 1993 up to March 1997; and finally the period from 1997 to 2002, encompassing the alliance between the AFRC and the RUF, the Lomé Peace Agreement, the resumption of hostilities and the eventual conclusion of the conflict. 2 More detail on the Commission’s three phases, including a justification for the chosen parameters, can be found in the chapter on the Military and Political History of the Conflict in Volume Three A of this report. Vol Three B Chapter One Mineral Resources Page 4 Vol Three B Chapter One Mineral Resources Page 5 The Political Economy of Mineral Resources 11. To understand the failure of the state in Sierra Leone and the role that minerals played in the conflict, we need to consider the nature of the state that emerged in 1961. At independence, there was euphoria that the new indigenous leadership would extend development and services to the people exponentially. In Sierra Leone, as in many other parts of Africa, the first few years following colonialism actually witnessed economic growth. Two key factors reversed this trend and set the country on a very different trajectory from the forward path desired by the people. 12. The first factor was the management of the economy. The popular expectation in the years before independence in many countries was captured by the Ghanaian Kwame Nkrumah in his refrain: “Seek ye first the political kingdom and all other things will be added unto you”. The assumption was that political independence would free latent energies in the nation. The new state would churn out a host of policies to create and empower an indigenous entrepreneurial class, which was expected to be the engine of growth and development. In reality, however, the beneficiaries of these new policies turned out to be the political elite rather than the common people. Unfortunately for Sierra Leone, the indigenous elite preferred rent seeking rather than active economic participation and quickly ceded control of important economic activities to Lebanese and Syrian businessmen. Furthermore, the dominant economic management theories of the time favoured state intervention and centralised management of the economy. Leading members of the ruling elite sought to privatise state resources, thus depriving the nation of the benefits of its most valuable assets. Such “predatory domination” has been defined as the “conversion of political power and position into economic wealth for the benefit of the few at the expense of the many.”3 13. Huge economic and development resources were placed in the hands of the new leaders. As the inheritors of power, the political elite acquired the tastes and behaviour of the departing colonialists. Such undisciplined control over resources opened the way for burgeoning corruption. Sierra Leoneans began to question the role and mission of the emergent political elite. 14. In 1978 a one-party state was imposed upon the people of Sierra Leone. This move by the ruling All Peoples’ Congress (APC) followed the co-optation of civil society leaders into government and the crushing of dissent. Political power became a means to economic wealth, with personal rewards so high that politicians would resort to extreme measures to win and maintain power.4 The state became the primary avenue for private enrichment. Gradually, power became de-institutionalised and personalised, resulting in dysfunctional public institutions and random violence. It was in the interests of the political elite to promote disorder, as it provided further opportunities to misappropriate the economic resources of the state. As a direct result, public institutions could no longer provide vital services to the people.5 3 See Callaghy, Thomas; The State-Society Struggle: Zaire in Comparative Perspective, New York, Columbia University Press, at page 191. 4 See Ake, Claude; “Address to the Inaugural Meeting of the Nigerian Political Science Association”, in West Africa magazine, 25 May 1981, at pages 162-163. The article is cited in Kandeh, J.; Political Economy of Democratisation, unpublished manuscript (hereinafter “Kandeh, Political Economy of Democratisation”); at page 2. 5 See Kandeh, Political Economy of Democratisation, at page 3. Vol Three B Chapter One Mineral Resources Page 6 15. The political elite had preferential access to the machinery of the state. Politicians, senior civil servants and military officers exercised a great deal of power over access to foreign and domestic capital and markets, which they used to accumulate large fortunes and to consolidate their control of the economy. Exploitation occurred through a burgeoning de facto market in government contracts, licences and offices. The productive and regulatory capacities of the state became severely eroded and compromised.
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