Glencore launches in-house lobbying as US targets cobalt operations in DRC

Swiss commodity trading and mining company Glencore has set up a one-man influence mission in the US capital, according to a disclosure form filed with the US Congress, which regulates corporate lobbying. Seth Levey, a former lobbyist for Norwegian state-owned multinational energy company Equinor, is registered to lobby the US government regarding “mining, energy and natural resources, foreign affairs, trade, manufacturing [and] recycling issues.”

The lobbying push comes as the Joe Biden administration and Congress are seeking to counter China’s dominance over the international supply of cobalt, a byproduct of copper mining that is a key ingredient in the lithium-ion batteries powering many electric cars. Around 70% of global cobalt mine production comes from the Democratic Republic of Congo (DRC).

Late last week, the Republican chairman of the House Foreign Affairs panel on global human rights, Congressman Chris Smith of New Jersey, introduced legislation that looks to crack down on child labour in the DRC while also taking aim at Chinese dominance.

“On the backs of trafficked workers and child labourers,” Smith said in a statement, “the Chinese Communist Party is exploiting the vast cobalt resources of the Democratic Republic of Congo to fuel its economy and global agenda.”

In the hot seat

Glencore’s outreach effort began soon after a federal judge in New York earlier this year fined Glencore $700m for corrupt practices in the DRC, Nigeria, Cameroon, Côte d’Ivoire and Equatorial Guinea as well as Brazil and Venezuela.

The Swiss giant is also tainted by its former decade-long association with Israeli businessman Dan Gertler, who has been sanctioned by the US government for allegedly signing “opaque and corrupt mining and oil deals” under former DRC President Joseph Kabila that cheated the country out of more than $1bn.

Levey and Glencore’s corporate offices both declined to comment on the record about Glencore’s US objectives.

A subsequent lobbying filing however shows that the company spent $60,000 in the first quarter of this year lobbying Congress and the State and Treasury departments on “issues related to foreign sanctions,” critical minerals, and the Lower Energy Costs Act.

The bill, which has passed the House of Representatives but not the Senate, looks to boost the US processing of critical minerals.

On the backs of trafficked workers and child labourers … the Chinese Communist Party is exploiting the vast cobalt resources of the Democratic Republic of Congo.

Glencore already has an outside firm, McLarty Inbound, lobbying on its behalf. Helmed by former US Ambassador to Germany Richard Burt, McLarty has represented Glencore since October 2021. The firm disclosed being paid $90,000 in the first quarter of the year to address “issues related to Glencore’s improvements and reforms on the subjects of corporate governance, compliance and stakeholder relations.”

Pressure’s on

Meanwhile, Congress and the Joe Biden administration have been putting pressure on DRC mining operators to change their ways.

For several years, the US government has pushed the government of President Felix Tshisekedi to revise deals with Chinese companies signed under his predecessor. And during December’s US-Africa Leaders Summit in Washington, the US signed a memorandum of understanding with the DRC and Zambia to encourage the two countries to jointly develop a supply chain for electric vehicle batteries.

US lawmakers are also getting in on the act.

Speaking at a 22 June hearing on the pending Africa budget requests from the State Department and the US Agency for International Development (USAID), House Foreign Affairs Africa panel chairman John James announced that he was working on legislation pertaining to minerals in the DRC. The Michigan Republican added that he would soon be leading a congressional delegation to the DRC, Tanzania and Nigeria.

“I’m currently working on legislation relating to the DRC critical minerals sector,” James said, “specifically in creating a strategy to balance our national security responsibility to ensure continued access to key mineral commodities such as cobalt and lithium, with the appalling working conditions present in the DRC mining sector, and extremely opaque business and climate that exists throughout the country.”

A week later, Congressman Smith introduced his “Countering China’s Exploitation of Strategic Metals and Minerals and Child and Forced Labour in the Democratic Republic of the Congo Act.” Smith’s office said the congressman had been working on his bill since last year and held a hearing on the topic in the previous Congress.

While the bill raises concerns with China’s reported control of 15 of the DRC’s 19 large cobalt mines, much of the attention is on child and forced labour in the country’s thousands of unregulated small and small-scale mines. Here too, China is accused of having played a nefarious role in recent years by either importing or having Chinese firms process the bulk of artisanal production inside the DRC, according to a 20 June study in the Proceedings of the National Academy of Sciences (PNAS).

To counter such abuses, Smith’s bill calls for sanctions – including asset blocks and visa restrictions – on foreign persons found to have facilitated child labour or forced labour in the DRC mining industry, “including any official of the government of the DRC.”