Institute for Environmental Security
Advancing Global Environmental Security
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Pathfinder Project: Combating Illegal Trade in Natural Resources
Technical assistance to importing countries to strengthen their mechanisms to deter and prevent the importation of the illicitly exported natural resources from fragile states
This project aims to promote the strengthening of legal mechanisms which importing and transit states could use to block illicitly obtained natural resources from entering their national markets and to dry up funds that are used to finance conflict in exporting countries.
The exhaustion of natural resources is generally recognised as one of the main problems affecting our planet today and this has been a critical concern of the international community for several years. The increasing prevalence of armed conflicts involving natural resources is now widely known throughout the world. Natural resources in developing countries are essential for future sustainable development and poverty alleviation but they can be misused to create the dynamics for localised armed conflicts and black and grey international commercial transactions.
In all free market countries, domestic commercial practices and governmental administrative regulatory systems interact in a structured fashion with local entrepreneurs, national businesses and individual foreign investors. However, in cases of weak governance and in conflict zones, the legitimate government often lacks adequate resources to effectively control the domestic markets that are being pushed toward criminalization. The way that natural resources are accessed, used and exploited, can cause, trigger and drive violent conflict within states and across sub-regions. Illicitly obtained natural resources are exported only by a series of illegal payments between corrupt businessmen, rebels, terrorists and even involving state and military officials. The illegal traffic in natural resources is increasingly used to finance violence and fuel conflicts in many countries and regions around the world.
Ultimately, the illegal trade in natural resources deprives developing countries, their citizens and their local communities of their right to development. It also does damage to international security, is harmful to the conservation of ecosystems, and undermines the moral values of all market participants. Importing countries therefore do have a responsibility - in cooperation with developing countries - to ban illegally obtained natural resources from becoming highly liquid commercial assets. What is needed is an appropriate legal regime and set of procedures to translate this responsibility into an effective peacekeeping tool.
The aim of this project, which begins with a first phase of research and extensive consultations over one year, is to identify legal processes that could be used in transit and importing countries (i.e. EU member states) which could assist legitimate authorities, civil organisations or injured parties from exporting countries to counter the commercial trade in illicitly obtained natural resources, and which could be used to dry up funds that are used to finance conflict and hence support environmental peacebuilding, conflict prevention, sustainable development and poverty alleviation.
The project has important parallels with an UNCTAD-UNU Project on the Rule of Law and Good Business Practices in Zones of Conflict which aims to explore possibilities for a new law-based mechanism to change the economics around the export of natural resources from conflict zones. The IES project is connected with the UNU-UNCTAD study through its coordinators who are involved in both projects and we expect the outcome of the UNU-UNCTAD study could contribute to the IES project and vice verse.
These projects also take place in the context of the wider developments within the United Nations, particularly the establishment of the Peacebuilding Commission, the Secretary-General’s focus on enhancing the functioning of rule of law in international relations, the UN Crime Commission’s attention to corruption and the Security Council’s focus on the role of business in conflict zones as well as the concern of several OECD governments and the European Union regarding conflict resources.
Workshop on Illegal Trade in Natural Resources
A first consultative meeting to discuss the planning and development of this project was held in The Hague on 6 October 2006. Representatives of several NGOs experienced in working on trade and conflict issues were present. The purpose of the meeting was to introduce the project and solicit strategic advice and practical recommendations regarding the initiative with respect to legal and political issues to be addressed as well as practical steps to be taken in developing the project in cooperation with other interested organisations.
Expert participants at the workshop were invited to join a contact group to continue to receive information about the project and to participate in its further development.
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