The White Stuff: Mining Giant Rio Tinto Unearths Unrest in Madagascar – by Jessica Hatcher (Time World Magazine – February 8, 2013)

Fort Dauphin – For five days in January, a few hundred protesters armed with slingshots in Fort Dauphin, Madagascar, blocked the road to one of the country’s largest economic assets, a $940 million mining operation run by the British-Australian company Rio Tinto. Their grievances were local: high unemployment, alleged political corruption and unsatisfactory reimbursement for relocating homes to make room for the mine. But the protest’s effects were global, and relate to anyone who wants to brush their teeth, put on sunscreen or whitewash their house.

Fort Dauphin could have supplied a tenth of the world’s ilmenite, a mineral used to make titanium dioxide, the white pigment commonly found in toothpaste, cosmetics and paint. The product is a staple of household goods in the west and global demand is growing, especially in India and China. But three weeks after the Fort Dauphin standoff, which ended when the Malagasy military dispersed the crowd with teargas, Rio Tinto announced a major scale-back in Madagascar. The company is shelving plans for a second – and larger –mine nearby in St. Luce, which leaves only one of three planned sites in operation.

The cuts mark a potential setback for Madagascar, where 70% of the population lives on less than $1 per day. The African nation has hydrocarbon deposits, gold, and half of the world’s sapphires, and the arrival of mining companies like Rio Tinto brought the prospect of improved economic conditions. But the protesters in Fort Dauphin say the mine exploited them, a charge the company denies.

Fort Dauphin is a small stretch of arable land bordered by mountains and sea in southeastern Madagascar. When Rio Tinto moved in to set up its mine, the only land it could offer in compensation to displaced locals had little agricultural value, so the company gave out cash. It had a profound effect on the culture. “We’re fishermen, we’re not used to handling large amounts of money”, said Hasoavana Mahalomba, 33, a construction contractor in Fort Dauphin. “People were buying cars, TVs, generators, drinking. It was like a party every day”. Some set up small businesses, but most failed.

One Rio Tinto staffer who asked not to be named said recent protests were simply locals looking for more handouts: “I think a big error in the past is that [Rio Tinto] gave people money – now that’s what everyone wants.” But the mine disrupted Fort Dauphin in other ways. Hotels sold out for two years, collapsing the area’s tourism business. An influx of sex-workers spread STDs. After an initial employment boom during construction, locals say the jobless turned to banditry.

Rio Tinto’s critics say the company is at fault for the town’s unrest. Zatinandro Perle Fourquet, a 46-year-old entrepreneur who led the protests against Rio Tinto in January, says just 10% of the mine’s employees are locals; Rio Tinto insists more than 70% of its staff is from the area.

For the rest of this article, please go to the Time Magazine website: