Commerce - The Fuel for War

DIAMONDS...OIL...COCA LEAVES... All of these and more are now labelled ‘conflict resources’ because their control and exploitation can create, contribute to or exacerbate armed conflict. International trade in natural resources has become a focus of attention for those seeking to resolve or prevent conflicts.

Kathy Vandergrift outlines the current approaches attempting to make commerce an incentive for peace, not the fuel of war.

Wars have always cost money, and control over natural resources has been a motive for war throughout history. What is currently drawing particular attention is the expanding internationalisation of both legal and illegal trade in conflict resources, and the fact that conflict resources have become a disincentive for resolving conflict.

Research in the economies of war suggests that a local armed conflict is likely to become tied into an international network of trade in weapons and natural resources within six months. The result is that wars continue longer, and are fought with more expensive and destructive weapons. Traditional diplomacy is based on the premise that peace is better for all parties. But when powerful economic forces have an interest in a conflict continuing, in order to preserve their access to cheap resources - when war is more profitable than peace - the accepted tools of peacemaking diplomacy become ineffective.

International trade in conflict resources makes people in distant locations complicit in human rights abuses. The campaign against conflict diamonds, for example, linked buying a diamond - a symbol of love - to the killing and maiming of children.

The problem is now on the agenda at the highest levels of international affairs. Stopping trade from fuelling armed conflict was named as a goal at the 2002 G8 meeting. Security Council Resolutions 1379 and 1460 call for states to control legal and illegal trades in natural resources and weapons that result in children being used in armed conflict.

Finding practical solutions
The prospect of a massive consumer boycott resulted in an international diamond certification system. Yet implementation remains a challenge - and diamonds are just one conflict source. A comprehensive solution is needed that includes other resources (which may be less vulnerable to boycotts), and curbs belligerents' access to finances while promoting economic development for general populations. Current approaches fall into four categories:

Transparency initiatives see public disclosure as a tool to influence resource flows. The Publish What You Pay campaign would make disclosure a requirement for being listed on major world stock exchanges.

Proposed codes of conduct for corporations working in conflict zones include steps to prevent complicity in human rights abuses and negative social impact on conflict-affected people. Models are being developed, though attempts to set standards would have more impact with enforcement or incentives - such as mandatory risk assessments, or tax benefits - and if there were consensus on what ‘complicity’ and ‘corporate responsibility for human rights’ entail. Human rights principles could also be built into trade agreements and contracts between governments and investors.

Targeted sanctions have been used by the Security Council in recent years to cut off access to weapons and finances for war. Sanctions, however, can inflict unintended harm to people already suffering from war, and tools to enforce targeted sanctions and prosecute ‘sanction-busters’ are limited.

Legal processes: some analysts believe existing international conventions on financing of terrorism and transnational organised crime can be used or amended to address conflict resources. Others argue for a new agreement specifically on commerce in conflict. The Alien Tort Act in the United States is being used to sue companies for human rights abuses committed in other countries, and similar laws are being advocated in other countries to prevent corporations from engaging in trade that violates human rights or fuels war.

There are positive and negative aspects to each of these solutions; progress is most likely to occur with continuing efforts on all fronts. Civil society groups and Governments both nationally and internationally will need to be persistent to ensure that commerce becomes an incentive for peace, not the fuel of war.

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Kathy Vandergrift is a Senior Policy Analyst for World Vision Canada.
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This article was first published in Global Future, Third Quarter 2003: ‘Profit and loss? Corporations and development’.
World Vision International. Email: global_future@wvi.org