MAC/20: Mines and Communities

End mineral resource plunders in Africa!

Published by MAC on 2008-07-20

POSITION STATEMENT

TENTH ANNUAL STRATEGY MEETING OF THE AFRICA INITIATIVE ON MINING, ENVIRONMENT AND SOCIETY (AIMES)

JUNE 24-26TH, ACCRA, GHANA

Introduction

We, 39 members of the Africa Initiative on Mining, Environment and Society (AIMES) from Burkina Faso, Democratic Republic of Congo, Ghana, Guinea, Kenya, Mali, Nigeria, Senegal, Sierra Leone, South Africa, Tanzania, Zambia, Zimbabwe and our partners from Canada, the United Kingdom and United States of America participating in its tenth Annual Strategy meeting call upon African governments to put in place alternative mining regime, contracts and investment standards for the mining sector in Africa in order to optimise national benefits including integrated national development, protection of community rights and the environment. The meeting which was hosted by Third World Network-Africa took place from June 24-26th, 2008, in Accra, Ghana

Purpose

Conceived as a platform for analysis, dialogue and information sharing, the objective of this annual strategy meeting was to analyse developments in the mining sector, investment standards and mining contracts and the challenges they present for Africa's development. On the basis of the analysis, the meeting offered alternative positions for a mining regime and a better framework for investment agreements/contracts and taxation in Africa. Through a reflection of the consequences of mining sector liberalisation which have rocked Africa over the past three decades and analysis of the constraints and challenges posed for an execution of alternatives and legitimate views the meeting adopted a collective advocacy agenda for and in Africa's extractive sector.

Context

The tenth annual strategy meeting took place at a time there are a number of developments and shift of positions with consequences for the mining sector of Africa. Mineral resources have strategic place in the social and economic development of many countries in Africa. In recent times, the price of various minerals is experiencing a rise to unprecedented historic high levels fuelled by a number of factors including increased demand by new entrants like China and India, the US foreign policy shift, in particular the War on Terror, corporate hegemony, and global market speculation. While the price surge provides a unique opportunity for mineral endowed African countries to capture windfalls from the price boom, in reality African governments and their people are losing out the benefits due to poor policy, contractual terms and fiscal arrangement. The lack of benefits from the price boom clearly reflects in the numerous calls by several governments of Africa for review of specific mining contracts and fiscal arrangements.

In addition to the mineral price surge and the calls for contract reviews, a number of policy reform processes targeted specifically at the mining sector of Africa are taking place on the realisation that Africa has not benefited from its rich mineral potentials. The United Nations Economic Commission for Africa (UN-ECA) is currently coordinating a process aimed at reviewing the mining regime and policy framework for Africa. The Africa Mining Partnership (AMP) a platform of African Energy and Mines Ministers and their policy officials in February this year proposed to develop a regional mining programme and a sustainable development charter for Africa. These processes go along side existing regional processes of mining policy harmonisation at the Economic Community of West African States (ECOWAS) and the Southern Africa Development Community (SADC). The World Bank Group the main architects of the current mining regime through its Africa Regional Portfolio the Africa Development Bank (AfDB) is also initiating processes for the reforms of the mining sector in Africa.

All these have consequences for the overall contribution of the sector to national development, the environment and community interest. The meeting was therefore organised both in response to the new shifts and also to put forward alternative policy proposals consistent with the developmental aspirations of the continent and its people, in particular local communities affected by mining.

Observations

This meeting was the tenth since the inception of AIMES in 1998 organised to review some of the challenges confronting the mining sector in Africa and to offer alternative proposals for their resolution. The theme of the meeting was "Resistance and Policy Alternatives: Mining Contracts and Investment Standards in Africa". In the context of geopolitics and realities on the ground, and in pursuit of the collective agenda of participating members the meeting discussed trends and developments in the mining sector, the mineral price surge and the challenges for Africa's development. The meeting also critically analysed current models of mining contracts and investment standards, and mining taxation in Africa; and proceeded to offer alternative positions and inventory of issues for continuing resistance to the plunder of Africa's mineral resources, while promoting social, economic and environmental justice, in particular for communities affected by mining. On the back of these issues the meeting made a number of observations as follows:

The last few decades have witnessed major reforms and rapid liberalisation of the mining sector in Africa. These reforms included among others revised fiscal terms, provision of incentives, and the creation of new institutions with the aim of attracting foreign exchange earnings, generating employment, increasing government revenue and technology transfer, and improving the quality of life.

After a partial success in attracting foreign capital into the mining sector and increasing mineral production and output in several countries, the experiment in liberalisation quickly revealed that the dream of achieving the objectives of the reforms has been much more complex and difficult than was imagined or expected. Going hand in hand with the narrowing of the role of the state and the public space, the efforts at increased government revenue, foreign exchange earnings, employment generation, and technology transfer through liberalisation of the mining sector has not yielded the results that were sought. Instead, the process of liberalisation has translated into serious economic deprivation, environmental destruction and restrictions in the rights of citizens, in particular people in communities where mines and mine facilities are located.

Despite massive reforms resulting in increased foreign direct investment and output of various minerals in Africa of the 1990s and 2000s coupled with the recent global mineral price surge, most African governments remain incapable of deriving any anticipated benefits and indeed windfall from the price surge. To this end, decades of mining and oil production in Africa have spurned national development. The situation in local communities affected by large mines and oil projects and their installations best illustrates how huge investments by transnational mining and oil companies in Africa's extractive sector have failed to translate into development while edging out thousands of people from their livelihood sources.

In addition to the economic deprivation, decades of mining and oil production in Africa have resulted in environmental disasters, social conflicts and impoverishment of the continent. In spite of the rhetoric of corporate social responsibility and calls for the protection of the environment and human rights, governments and transnational mining companies have failed to prevent or adequately address the negative consequences of mining on the environment and society. They have also failed to address the numerous legitimate concerns of local communities and small-scale mining.

In recent years, there has been an increase in alleged cases of violence and human rights abuses perpetrated against small-scale and artisanal miners and people living in communities affected by mining and oil projects by State security, and private security of mining companies. In many cases, violent actions by the State and mining companies towards local communities and small scale miners become the privileged mode of resolving legitimate concerns.

Women are particularly affected by mining because of their multiple roles and their subordinated status in most African societies. Moreover, the replacement of the subsistence economy by cash economy on which communities and women within them have no control at all has resulted in the marginalisation of women as food producers; an increased burden on them as water providers, care-givers and nurturers; a decrease in their productivity and incomes due to environmental destruction; and their increased involvement and containment in the informal economy to find alternative sources of incomes for sustaining their families.

The failure of African governments to optimise the benefits of mining and to respond to the needs and concerns of citizens is a failure in policy, law and institutional practice. The regime under which mining operates in Africa is a regime that creates and perpetuates a system of inequalities as well as imbalances in mineral trade and investment. It is also a regime that legalises mineral resource capture, ecological destruction and human rights violations.

In addition to the huge incentives and stiff protection offered to transnational mining companies by national mining laws, African governments have entered into contractual arrangements with specific mining companies. These contracts not only lock in governments denying them any opportunity of flexibility but also the terms and conditions of the contracts set very low standards, unbalanced relationship in terms of rights and obligations of each party, and deprive governments and citizens of any opportunity of optimising the benefits of mining.

We observed with great concern that despite the emerging democratic culture and new doctrines of participatory planning and development on the continent, most of investment agreements (mining contracts) took place in very untransparent processes, under unacceptable conditions (especially during times of conflicts when citizens participation is almost impossible), and with influence and sometimes arm-twisting by mining companies, their home governments and national elites. Some of the contracts in Democratic Republic of Congo, the Mittal Steel Holdings in Liberia and the West African Gas Pipeline Project involving Nigeria, Benin, Togo and Ghana are examples of the bigger picture on the continent.

Also, the failure to optimise the benefits of mining is due to failure on the part of African governments to conceive of national development strategy without a significant role of foreign direct investment. This notion of the centrality of foreign direct investment isolates the mining sector from a holistic national development strategy and offers it an undeserving priority which results in enclavity and an extroversion of the national economy. While this failure may be partly due to capacity constraints it is largely the result of external pressure and policy prescriptions for the continent without due cognisance of the peculiar circumstances in time and space.

Flowing from the narrow conception of national development strategy there has not been a proper placement of the real and potential contribution of small-scale and artisanal mining as well as linkages to other sectors and small scale producers in the national economy. At the same time African governments offer their mineral sector to transnational mining and oil companies by giving them special dispensations and subsidies in the form of tax breaks, unwarranted custom and excise duty exemptions on tall mining list *. This results in narrowing not only the tax net but also employment opportunities while encouraging capital flight.

In the midst of this plethora of challenges transnational mining companies continue to consolidate their position with support from their home governments and Multilateral Institutions such as the World Bank Group (WBG) and International Monetary Fund (IMF) by adopting cross-national strategies for natural resource extraction, typically within sub-regional economic frameworks; by launching special initiatives; and by demanding further protection through negotiation of investment agreements or contracts between it and individual countries.

These strategies not only serve as smokescreens to bad legacies but also collectively and cumulatively undermine national development efforts. In the area of taxation, corporate strategy through such measures as mergers, acquisitions, and hedging contribute to tax evasion and tax avoidance thereby diminishing real and potential government revenue accruing from mining. The inability of African governments to effectively increase tax collection, negotiate, monitor contracts and implement even the minimal policies and laws is often time compounded by such unethical corporate practice and behaviour as well as the erosion of the role of the state in planning and general governance of the mining and oil sector in Africa.

Alternative proposals

In light of the foregoing we make the following demands and recommendations:

a.. That there must be a paradigm shift on the concept of investment and its approach and application. We proposed a new conception of investment that prioritises a balance between profitability and strong ethics, and which favours development with redistribution, equity, justice and fairness rather than corporate profit.

a.. That African governments should put in place an alternative mining regime, contracts, and investment standards that optimise national benefits including integrated national development, protection of community rights and the environment.

a.. We call for coherence in the current processes of mining sector reforms and harmonisation in Africa. Such coherence and harmonisation must of necessity end the current race to the bottom, provide for a framework for strong state intervention, and a clear strategy for optimising benefits without compromising the interest of other sectors and future generations, and also take into account the peculiar circumstances of some African countries, particularly those emerging from conflicts as well as those who are relatively new to mining.

a.. We particularly recommend that the processes of reforms and harmonisation should provide opportunity for exploring and putting forward policy options that go beyond the familiar centrality of foreign direct investment in Africa as a whole and in the mining sector in particular.

a.. Existing mining contracts must be reviewed in a fully participatory and transparent manner to reflect tangible benefits to African countries and mining communities while taking cognisance of the need for environmental protection and human rights observance. In particular Civil Society and mining communities must be involved in the processes. Any new mining contracts must adhere to the above standards.

a.. Governments, mining companies and multilateral and bilateral actors must all commit to public disclosure of information and early notification of all processes and activities in the extractive sector to all persons, especially affected communities and women's organisations. To this end we demand the removal of all confidentiality clauses on environmental audit reports and urge all governments to expedite action on the passage of freedom of information and whistle blowing bills into laws.

a.. That the public disclosure must be backed by conscious commitment to promoting and ensuring accountability and participatory decision-making through the provision of systems, mechanisms and benchmarks for equal opportunities, collective ownership, detection of abuse of power and feedback.

a.. All pressures and policy prescriptions for Africa and African governments must cease forthwith so as to allow African governments and people to enjoy the right to policy choices, review their laws and mining contracts without any limitation.

a.. In relation to the above, we demand the unconditional abolition of all stability clauses as legal provisions in national mining codes.

a.. African governments must make an effort to improve the technical capacity of their institutions within the framework of regional integration to facilitate the diffusion of knowledge and skills.

Conclusion

We concluded the meeting with understanding and commitment to work together in collaboration and solidarity with communities affected by mining, African civil society organisations, partners from the global north and south to:

• End mineral resource plunders in Africa.

• Promote and ensure that Africa optimises the benefits of its mineral potentials in ways that guarantee national economic development, human rights, environmental sustainability and promote community interests.

• Resist any further lowering of national mining standards

• Building pressure for the adoption of our collective positions that advance the development of Africa

We call on the media to echo our demands and recommendations

Third World Network-Africa is secretariat of AIMES. For further information please contact Abdulai Darimani or Lindlyn Amang Tamufor on +233-21-500419/503669 Email: environment@twnafrica.org

Endorsed by:

1. Akpobari Celestine

National Administrator

Ogoni Solidarity Forum

Social Action Complex

33 Oromineke Layout

b/Line Portharcourt, River State

Nigeria

Cell: +234-803-273-3965

Email: ogoniadvancement@yahoo.com

2. Amani Mustafa Mhinda

Coordinator

Tanzania Mineworkers Development Organisation

P.O. Box 12536

Arusha, Tanzania

Tel.: +255-255-5666

Cell: +255-78-440-8819

Fax: +255-255-5666

Email: t9@justice.com

3. Asaah Sumaila Mohammed

Legislative Advocacy Programme Officer

Centre for Public Interest Law (CEPIL)

Accra

Cell: +233-24-268-4285

Email: mohammedasaah@yahoo.com

4. Samira Dauod

Regional Coordinator

Panos Institute, West Africa

6 rue Caluetter

BP 21132, Dakar Pouty

Dakar, Senegal

Tel.: +221-77-732-1697

Cell: +221-33-843-1666

Fax: +221-33-822-1761

Email: sdaoud@panos-ao.org

5. Abu A. Brima

Executive Director

Network Movement for Justice and Development (NMJD)

29 Main Motor Road

Freetown, Sierra Leone

Tel.: +232-02-345-3073 / 077251698

6. Suna Kumba Bundu

Programme Officer

Network Movement for Justice and Development (NMJD)

29 Main Motor Road

Freetown, Sierra Leone

Tel.: +232-02-345-3073 / 077251698

Email: sunabundu@yahoo.co.uk

7. Noah Zimba

Citizens for Better Environment (CBE)

Afcom House (HQ)

c/o Regional Office

P.O. Box KL6

Lusaka, Zambia

8. Nii Adjetey-Kofi Mensah

Executive Director

Artisanal Mining Network

P.O. Box 81, Tarkwa, Ghana

Tel.: 233-036-222574

Cell: +233-20-816-1636

Email: artisanalmining@yahoo.com

adjeteykofinii@yahoo.com

9. Roger Moody

Mines and Communities

41A Thornhill Square, London

Tel/Fax: +44 20 77 00 6189

Email: partisans@gn.apc.org

10. Nnee Neeka Nornu

Programme Officer

Institute of Human Rights & Humanitarian Law (IHRHL)

2B Railway Close, D/Line

Portharcourt, Nigeria

Email: ihrhl@ihrhl.org

11. Wilson Kipsang Kipkazi

Secretary/Programmes Director

Endoris Welfare Council

P.O. Box 15801-00200

Nakuru, Kenya

Tel.:+254-020-214-0886

Cell:+254-053-206-1107

Email: kipkaziwk@gmail.com

12. Bennet Mwika Simbeye

Reporter

Times of Zambia

P.O. Box 20682

Kitwe, Zambia

Tel.: +260-21-222-3563

Cell: +260-97-743-5767

Fax: +260-21-222-2251

Email: mwikabm@yahoo.com

13. Kabinet Cisse

Change de Programme Resource Naturelle

CECIDE, BP 3768, Conakry, Guinea

Tel.: +224-60586697 / 30467035

Cell: +224-6058-6697

Email: cecideomc@yahoo.fr

14. Makanatsa Makonese

Zimbabwe Environmental Law Association (ZELA)

Number 6 London Derry Road, Eastlea, Harare, Zimbabwe

Tele/Fax: (00263-4) 252093/253381/250971

Email: zela@mweb.co.zw

15. Salum Nwalim Juma

Journalist, Channel Ten

19045 Dar es Salem, Tanzania

Tel.: +255-71-325-6172

Cell: +255-022-211-6341

Email: mwalims@yahoo.com

16. Idrisa Sako

Journalist, Les Echoes

BP 2043, Avenue Cheick

Zayed Bamako, Hamdallaye

Tel.: +223-229-6289

Cell: +223-647-5472

Fax: +223-229-7639

Email: idisac2002@yahoo.fr

17. Ferrial Adam

SADC Mining Research Coordinator

Bench Marks, Johannesburg, South Africa

Tel.: +27-11-832-1759

Cell: ++27-74-181-3197

Email: feradam@gmail.com

18. Vivian Bellonwu

Programmes Officer

Social Action, Port Harcourt, Nigeria

Tel.: +234-70-393-7306

vivianbello@yahoo.co.uk

19. Richard Adjei-Poku

Executive Director

Livelihood & Environment Ghana

P.O. Box 88, Ahafo, Kenyasi

Cell: + 233-24-338-8299/+233-27-553-7802

Email: leg2004ah@yahoo.com

20. Moses K. Kambou

Executive Director

ORCADE

09 BP 675, Ouagadougou 09, Burkina Faso

Tel.: +226-5-036-2089

Cell: +226-7-027-9673

Email: moskam@orcade.org

21. Wole Olalaye

Actionaid,

P.O. Box 554-00606, Nairobi, Kenya

Tel.: +254-20-425-0000

Cell: +254-71-060-7379

Email: WOLE.OLALEYE@ACITONAID.ORG

22. Jamie Kneen

Communications & Outreach Coordinator

Miningwatch, Canada

508-250, City Centre Ave, Ottawa, ON K1R 5R2, Canada

Tel.: +1-613-569-3439

Cell: +1-613-761-2273

Fax: +1-613-569-5138

Email: Jamie@miningwatch.ca

23. Richard Ellimah

Programme Officer

Wassa Association of Communities Affected by Mining (WACAM)

P.O. Box 26 Obuasi, Ghana

Tel.: +233-2-220-0858

Cell: ++233-24-451-4559

Fax: +233-2-220-0858

Email: richellimah@yahoo.com

24. Jean-Luc Muke

Member, Avocats Verts Org

Kinshasa, Democratic Republic of Congo

Tel.: +243-81-812-8219/+243-89-951-0451

Email: jeanlucmuke@yahoo.fr

25. Joshua Klemm

Program Associate, Africa

Bank Information Center

1100 H Street, NW, Suite 650

Washington, DC, 20005

Tel: +1 202 624-0630

Email: jklemm@bicusa.org

Skype: klemmjd

26. Kato Lambrechts

Christian Aid

35 Lower Marsh, London SE1 7RL

Email: KLambrechts@christian-aid.org

27. Alvin Mosioma

Coordinator

Tax Justice Network for Africa (TJN-A)

Mbaruk Road, Mucai Drive, off Ngong Road P. O. Box. 25112 - 00100

Nairobi- Kenya

Tel: 254-20-2721076, 2721655, 2725743

Fax: 254 20 2725171

Mobile:+254722571614

28. Kyeretwie Opoku

Civic Response

37 New Town Loop

D-T-D Accra North

kyeretwie@civicresponse.org

29. Abdulai Darimani

Third World Network - Africa

P.O. Box AN19452

Accra-North

Tel.: +233-21-511189

Email: environment@twnafrica.org

30. Lindlyn Tamufor

Third World Network - Africa

P.O. Box AN19452

Accra-North

Tel.: +233-21-511189

Email: environment@twnafrica.org

31. Thomas Akabzaa

Department of Geology

University of Ghana, Legon, Accra , Ghana

Email: takabzaa@ug.edu.gh

32. Anna Antwi

Right to Food Policy Advisor

ActionAid Ghana

Tel: +233 (21) 764931/2

Anna.Antwi@actionaid.org

www.actionaid.org/ghana

33. Stephen Donkor

Teleku-Bukaazo/Anwia Community

Nzema East District Western Region of Ghana

34.. John Adza John Adza
Executive Director

The African Challenge

Accra

Tel: 0277534980

Email: africh2002@yahoo.com

35. Emmanuel Bensah

Third World Network - Africa

P.O. Box AN19452

Accra-North

Tel.: +233-21-511189

Email: webjournalist@twnafrica.org

36. Noble Wadzah

Friends of the Earth Ghana

Cell: +233-24 225 79 72

Email: kowadzah9@yahoo.com

37. Kwesi Wrekon-Obeng

Third World Network - Africa

P.O. Box AN19452

Accra-North

Tel.: +233-21-511189

Email: africanagenda@twnafrica.org

38. Yao Graham

Third World Network - Africa

P.O. Box AN19452

Accra-North

Tel.: +233-21-511189

Email: twnafrica@twnafrica.org

39. Pauline Vande-Pallen

Third World Network - Africa

P.O. Box AN19452

* A Tall Mining List provides tax exemptions for mining equipment, supplies and plants

 

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