Thursday 17 January 2013

Monitoring the mineral miners

A detailed analysis by Global Witness of the 2008 Aynak agreement between the Government of Afghanistan and the China Metallurgical Construction Company/Jiangxi Copper Company consortium provides the first insight into what the deal means for Afghanistan's future.
According to the report, Copper Bottomed? Bolstering the Aynak Contract: Afghanistan's first major mining deal, there are positive economic, infrastructure and social commitments, as well as crucial commitments to protecting the local community and environment from potential adverse impacts from mining.
This one deal alone is projected to generate an estimated $541 million a year by 2016 and to create around 5,000 jobs. Other mineral contracts are likely to follow, including the huge Hajigak iron ore concession.
However, these are undermined by serious gaps and weaknesses. For example, even though the Afghan government has published over 200 extractive contracts in the last few months, the main Aynak contract has not been published and therefore the Afghan people cannot see the terms agreed.
Nor is there any contractual obligation to engage communities on decisions and plans that directly affect them.  High royalty rates are undermined by provisions which enable renegotiation, and priority access to other resources at the site. Key human rights and cultural protections are absent, and it is not clear how commitments to best practice will be implemented and monitored.
In response to the GW report, in December the Afghan government agreed to publish the Aynak contract and to make various other concessions.
Also worth viewing is the GW report on Afghanistan's gold mining industry, Getting to Gold, published last April.

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