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| 1 |
ID:
158645
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| Summary/Abstract |
In the Democratic Republic of Congo, donors promoted rapid liberalisation and presidential elections in the aftermath of the war, and after two terms, President Kabila has not left office. This article engages with the question of how liberalisation and elections are connected, and how they are related to the extension of presidential power. It finds that the international market for minerals has shaped the domestic political economy but its nature has effectively been ignored in the formulation of donor policy; efforts at regulating trade have been concentrated on due diligence of origin in Congo but have not addressed the secrecy of international trade. Liberalisation has removed control of economic resources from Congo, provided returns for elite politicians and funded violence to control the disenfranchised population. The offshore companies are the elephant in the room; without acknowledging them, analysis of the liberalisation and its interaction with presidential tenure lacks assessment of the opportunities, interests and power that shaped the processes.
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| 2 |
ID:
139214
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| Summary/Abstract |
Using an event study approach to analyze stock market data from the United States, I investigate how regulations on conflict minerals sourced in the Democratic Republic of the Congo were perceived by investors. I find that for a subset of mining companies, stock returns were abnormally high when regulations in the US became more likely. I also find that returns were higher for communications equipment manufacturing companies when strong regulations in the DRC were announced. I argue that these responses were due to the competitive environments faced by each of these company types. These findings relate to debates surrounding the effects of the conflict mineral regulations. While some critics argue that reporting requirements were tantamount to a ban on minerals from the DRC, I find that stock returns for a subset of companies were sensitive to legislation in the DRC after legislation became law in the US, suggesting that market participants did not expect a complete trade ban on regulated mining and trading activities.
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