Canadian Mining in Africa: “Do As You Please” Approach Comes at High Cost – by Bonnie Campbell (Canadian Dimension – Jan/Feb 2011)

Canadian Dimension is a Canadian leftist magazine founded in 1963 by Cy Gonick and published out of Winnipeg, Manitoba six times a year.

Bonnie Campbell is a professor of political economy at the Department of Political Science at the University of Québec in Montreal where she heads the Research Chair C.-A. Poissant on Governance and Aid for Development.

While Canadian miners have expanded to all continents, Africa now accounts for about 17 percent of Canadian mining assets abroad, up from 11 percent in 2001. Next to South African investments, companies registered on Canadian stock exchanges now represent the most important source of investment in mining in Africa. From a total amount of C$ 2.87 billion in 2001 and $6.0 billion in 2005, Canadian mining investment in Africa exceeded $23.6 billion in 2010. The trend illustrating the growing presence of Canadian companies in Africa is given in Graph 1 and the 2010 distribution of assets by countries in Graph 2. The country distribution of that investment and the minerals concerned as of December 2008 are in the pictures above.

The map shows that 91% of Canadian investments are concentrated in eight countries, with the order of countries’ importance being the following: South Africa (25.6%), DR Congo (17.8%), Madagascar (13.8%), Zambia (9.9%), Tanzania (9.5%), Ghana (6.5%), Burkina Faso (4.7%) and Mauritania (3%).

Issues of violence, environmental damage and human rights abuses abound in mineral rich Africa and according to a 2009 report produced by the Canadian Centre for the Study of Resource Conflict, Canadian mining companies have been the most significant group involved in such violations.

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Barrick Gold’s May 19th and 25th Web Responses to Seven Tanzanian Deaths

North Mara’s 2010 Responsibility Report (PDF): click here

Recent police action at North Mara, Tanzania

Update May 25, 2011 — There is a great deal of misinformation circulating in the local community at North Mara, and being reported by media. Barrick and African Barrick Gold have been unable to verify a number of allegations circulating involving Tanzanian police activity. The police are the appropriate authority to confirm or deny those allegations. We are continuing to focus our efforts on re-establishing a constructive dialogue with the local community and also continuing our efforts to work together to improve the situation in the area surrounding our property.

Further updates and information will be provided as required.

Message concerning recent police action at North Mara

May 19, 2011 — The recent violent confrontation and loss of life at African Barrick Gold’s (ABG) North Mara mine is deeply concerning to Barrick and ABG. African Barrick Gold is working with the Tanzanian government and police to address this situation.

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Bodies of men shot at Barrick mine stolen and dumped by police: families – by Jocelyn Edwards (Toronto Star – May 25, 2011)

The Toronto Star, which has the largest circulation in Canada, has an enormous impact on Canada’s federal and provincial politics as well as shaping public opinion. This article was originally published May 25, 2011.

Grim  warning near African Barrick mine

TARIME, TANZANIA – It was on the side of a dirt road in northern Tanzania that relatives found a coffin containing the body of Emmanuel Magige on Tuesday morning.

The 27-year-old man was one of seven people killed and more than 12 injured on May 16 when villagers at African Barrick’s mine in northern Tanzania clashed with security forces.

Late Monday night, police stormed a mortuary in the small northern town of Tarime and removed bodies belonging to four of the dead in a bid to prevent a memorial planned at the mine for Tuesday, witnesses said. After finding the bodies of the victims forcibly returned to their villages, families instead held small burial services at their homes in the afternoon.

“It was inhuman. They did this like animals,” said Magige’s 20-year-old wife, Mary.

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Memorial for dead banned at Canadian [Barrick] gold mine in Africa – by Jocelyn Edwards (Toronto Star – May 24, 2011)

The Toronto Star, which has the largest circulation in Canada, has an enormous impact on Canada’s federal and provincial politics as well as shaping public opinion. This article was originally published May 24, 2011.

TARIME, TANZANIA—Families of the five men killed by security forces of a Canadian mine are furious after that were denied permission to hold a memorial service Tuesday at African Barrick’s gold mine in North Mara.

“When you have lost your loved ones and you are in a grieving period, for someone to do this to you, it is not right. It would be better if they would take you too,” said Magige Gati, whose 27-year-old son Emmanuel Magige was among the dead.

Five men were killed, and at least a dozen injured, when about 800 locals clashed with security on May 16 at a mine in the area owned by African Barrick, a subsidiary of Toronto-based Barrick Gold Corporation.

The clash is the latest episode in an ongoing conflict between residents of North Mara, who come to the mine to scavenge for gold and Barrick, which took over the mine in 2006.

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Barrick Gold: Controlling fallout from deadly clash [7 Tanzanian deaths]- Lisa Wright (Toronto Star – May 21, 2011)

Lisa Wright is a business reporter with the Toronto Star, which has the largest circulation in Canada. The paper has an enormous impact on Canada’s federal and provincial politics as well as shaping public opinion. This article was originally published May 21, 2011.

Stan Sudol, a communications consultant and mining industry blogger,
recommends that the Canadian government establish a fact-finding mission,
headed by a respected, retired, non-partisan individual, to go to Tanzania
“to shed light on this incident. It’s the only way to get credibility back to
the Canadian mining sector. No one is going to believe any report coming
from Barrick or the Tanzanian government,” he says. (Toronto Star, May 21, 2011)

Two words instantly come to mind in cynical business circles when a tragedy occurs under a big company’s watch: damage control. Barrick Gold Corp. landed in a firestorm of controversy last week when seven villagers were gunned down and a dozen more were injured in a brutal clash at its troubled North Mara mine in Tanzania, run by its African Barrick Gold division.

Though Barrick spun off its higher-cost African assets last year to the newly-created London-based firm, the Toronto bullion behemoth remains the majority owner.

And since Barrick’s name is literally on it, the Toronto headquarters is forced to wear — and ultimately repair — the hit to its global brand, and it won’t be easy, say industry watchers and public relations experts.

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A Golden Opportunity: How Tanzania is Failing to Benefit from Gold Mining – by Mark Curtis and Tundu Lissu (October 2008)

Published by the Christian Council of Tanzania (CCT), National Council of Muslims in Tanzania (BAKWATA), and Tanzania Espicopal Conference (TEC) – Financed by Norwegian Church Aid and Christian Aid

A Golden Opportunity: How Tanzania is Failing to Benefit from Gold Mining (October 2008)

Executive Summary

Gold mining is the fastest growing sector of Tanzania’s economy. Minerals now account for nearly half the country’s exports and Tanzania is Africa’s third largest gold producer. Yet ordinary Tanzanians are not benefiting from this boom both because the government has implemented tax laws that are overly favourable to multinational mining companies and because of the practices of these companies. Tanzania is being plundered of its natural resources and wealth.

Between 1997 and 2005, Tanzania exported gold worth more than US$2.54 billion (bn). The government has received around $28m a year in royalties and taxes on these exports, amounting to just 10 per cent over the nine year period. The 3 per cent royalty has brought the government only an average of US$17.4m a year in recent years. Raising the royalty rate to, say, 5 per cent would have increased government revenues by around US$58m over the past five years.

We calculate that Tanzania has lost at least $265.5m in recent years as a result of an excessively low royalty rate, government tax concessions that allow companies’ to avoid paying corporation tax and possibly even tax evasion by some companies if allegations are true. This is a very conservative estimate, in that it does not cover all the gold mining companies or all figures for recent years (which are not publicly available). Neither does it cover the financial costs of other tax incentives such as VAT exemption, which are extremely difficult to estimate.

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Black eye for Barrick taints Canada, critic says – by Lisa Wright (Toronto Star – May 19, 2011)

Lisa Wright is a business reporter with the Toronto Star, which has the largest circulation in Canada. The paper has an enormous impact on Canada’s federal and provincial politics as well as shaping public opinion. This article was originally published May 18, 2011.

Barrick Gold Corp. has tainted Canada’s international mining image, say industry observers, as police and company officials investigate why seven people were killed at the gold giant’s troubled Tanzanian mine.

“I think it’s a big hit on their reputation. That’s a lot of people to die at one time on a mine site,” said Toronto activist Sakura Saunders, co-founder of the ProtestBarrick.net website.

Police at the North Mara mine near the Kenyan border, a site run by its African Barrick Gold division, opened fire Monday when about 800 villagers stormed the site with machetes, hammers and rocks to reportedly steal valuable gold ore.

All’s quiet since then at the site says a spokesman, while an internal investigation by the company — majority-owned by Toronto-based Barrick — and a separate one by Tanzanian police begins into the deaths and the estimated dozen injured in the violent confrontation.

“We are reviewing the security situation at North Mara but it will take some time to unravel,” said Charles Chichester, a spokesman for the London-based company.

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Snake oil and the Myth of Corporate Social Responsibility [Canadian Mining Companies] – by JP LaPlante and Catherine Nolin (Canadian Dimension – Jan/Feb 2011)

Canadian Dimension is a Canadian leftist magazine founded in 1963 by Cy Gonick and published out of Winnipeg, Manitoba six times a year.

In March 2009, Canada released its long-awaited response to calls for regulatory oversight of the overseas operations of extractive industries such as mining and oil. The Conservative government’s Building the Canadian Advantage: A Corporate Social Responsibility (CSR) Strategy for the Canadian International Extractive Sector was drafted in response to years of public, civil society, and parliamentary pressure to remove the impunity with which Canadian extractive companies operate overseas. A 2005 parliamentary report calling on legal reform, and subsequent government-industry-civil society National Roundtables – resulting in recommendations for an independent ombudsman’s office – did little to counter mining industry lobbying and a receptive Conservative government.

The resulting corporate social responsibility (CSR) strategy is a tepid response that has no teeth, but we find it a useful starting point to understand just what is CSR and how the world of corporate public relations is appropriating the term for their own benefit.

Nearly every major extractive industry player has adopted voluntary CSR policies or social sustainability statements and a growing body of consultants, socially responsible investors, and NGOs are debating how to promote it. However, ongoing violations of human rights beg the question: is talking in terms of CSR useful to those trying to seek justice for harms committed by Canadian multinationals?

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Seven ‘intruders’ killed at African Barrick mine – Peter Koven (National Post – May 18, 2011)

The National Post is Canada’s second largest national paper. Peter Koven is the Post’s mining reporter. This article was originally published in the Financial Post on May 18, 2011. pkoven@nationalpost.com

When Barrick Gold Corp. spun its African properties into a new company last year, investors knew they were being sold high-risk assets that had their share of problems.

But they didn’t imagine this.

On Tuesday, African Barrick Gold PLC reported details of a horrifying incident at its North Mara mine in Tanzania. According to the company, about 800 “criminal intruders” armed with machetes, rocks and hammers broke into the mine site and tried to steal gold ore. The Tanzanian police were called in and were forced to open fire after being attacked by the intruders. Seven people were killed and another 12 injured.

“The police are making an investigation, so more details will come from them in the days and weeks to come,” a spokesman for London-based African Barrick said.

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NEWS RELEASE: African Barrick Gold plc: Security incident at North Mara

17 May 2011

On 16 May 20011, a number of the Tanzanian Police (FFU) came under sustained attack by approximately 800 criminal intruders who illegally entered the North Mara mine site and attempted to remove ore from the run of mine (ROM) pad.

The FFU had been called to the area to respond and were set upon by the criminal intruders armed with machetes, rocks and hammers.

According to information received, a number of intruders sustained gunshot wounds, resulting in seven intruder fatalities and twelve injuries.

The police have begun an investigation into the incident. Additional police have been deployed to the area. African Barrick Gold has also initiated an internal company investigation. There have been no material impacts to the operation or production.

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Barrick Gold’s security kill 7 at Tanzania mine – by Lisa Wright/Jocelyn Edwards (Toronto Star – May 18, 2011)

Lisa Wright is a business reporter with the Toronto Star, which has the largest circulation in Canada. The paper has an enormous impact on Canada’s federal and provincial politics as well as shaping public opinion. This article was originally published May 18, 2011.

Lisa Wright in Toronto and Jocelyn Edwards in Tanzania 

Security forces at African Barrick Gold’s North Mara mine in Tanzania killed seven “criminal intruders” and injured a dozen more after 800 people stormed the project armed with machetes, rocks and hammers in a bid to steal gold ore.

Police were called to the area on Monday and “came under sustained attack” by hundreds of people who illegally entered the mine site to try to remove ore from one of the crushers, said a statement released by the London-based company, which is a majority-owned subsidiary of Toronto’s Barrick Gold Corp.

“A number of intruders sustained gunshot wounds, resulting in seven intruder fatalities and 12 injuries,” said the release. The deadly clash is the latest in an ongoing battle between the giant Canadian miner and locals who scavenge for gold-laced rocks on the lucrative property, which Barrick acquired in 2006.

The price of gold has tripled in value since then, reaching a record high of $1,540.25 (U.S.) an ounce earlier this month and making it all the more attractive to villagers involved in illegal small-scale mining.

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Shooting Gold Diggers at [Barrick Gold] African Mine Seen Amid Record Prices – by Cam Simpson (Bloomberg Markets Magazine – April 2011)

Bloomberg Markets magazine brings the inside view of professional investing with unparalleled access to the most influential people in global business and finance.

Security guards and federal police have allegedly shot and killed people scavenging the waste rock at Barrick Gold’s North Mara mine in Tanzania

(Bloomberg) — Barrick Gold Corp.’s North Mara mine near the Tanzanian border with Kenya disgorges millions of pounds of waste rock each week, piled high around communities where almost half the people live on less than 33 cents a day.

Children in school uniforms scurry across the rubble to reach their classes. Women with water pails atop their heads skirt past the heaps. The piles grow as the longest bull market for gold in at least 90 years pushes Barrick, the world’s largest miner of the precious metal, to increase production.

Villagers, too, are hunting the ore on the North Mara land that their ancestors worked for decades, sometimes paying with their lives.

Security guards and federal police allegedly have shot and killed people scavenging the gold-laced rocks to sell for small amounts of cash, according to interviews with 28 people, including victims’ relatives, witnesses, local officials and human-rights workers.

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The Chinese in Africa: Trying to pull together – (The Economist – April 23, 2011)

The Economist is one of the most globally respected English-language weekly news publications, focusing on international politics, business and opinion.

Africans are asking whether China is making their lunch or eating it

ZHU LIANGXIU gulps down Kenyan lager in a bar in Nairobi and recites a Chinese aphorism: “One cannot step into the same river twice.” Mr Zhu, a shoemaker from Foshan, near Hong Kong, is on his second trip to Africa. Though he says he has come to love the place, you can hear disappointment in his voice.

On his first trip three years ago Mr Zhu filled a whole notebook with orders and was surprised that Africans not only wanted to trade with him but also enjoyed his company. “I have been to many continents and nowhere was the welcome as warm,” he says. Strangers congratulated him on his homeland’s high-octane engagement with developing countries. China is Africa’s biggest trading partner and buys more than one-third of its oil from the continent. Its money has paid for countless new schools and hospitals. Locals proudly told Mr Zhu that China had done more to end poverty than any other country.

He still finds business is good, perhaps even better than last time. But African attitudes have changed. His partners say he is ripping them off. Chinese goods are held up as examples of shoddy work. Politics has crept into encounters. The word “colonial” is bandied about. Children jeer and their parents whisper about street dogs disappearing into cooking pots.

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Rumble in the jungle – Africa and China – (The Economist – April 23, 2011)

The Economist is one of the most globally respected English-language weekly news publications, focusing on international politics, business and opinion.

CHINA has a competitive advantage that is rare among economic powers investing in faraway developing countries: a lack of ancient hostility. In the past decade Chinese investors have been welcomed with open arms in places where Western colonial powers once misbehaved and their descendants sometimes still arouse suspicion.

Hundreds of thousands of Chinese have comfortably set up shop in Africa, bringing with them economic growth and useful technical skills. Their government, eager to loosen constraints on resources and industrial expansion at home, supports them with abundant loans. Africa now supplies 35% of China’s oil. Two-way trade grew by 39% last year.

China deserves credit for engaging a continent that desperately needs investment. Millions of Africans are using roads, schools and hospitals built by Chinese companies or financed with fees from resources they extracted. Not surprisingly, many African leaders have embraced the Chinese, especially when offered vast loans for infrastructure projects. By contrast, the leaders say, Western governments these days offer little more than lectures on good governance.

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Anglo American CEO Cynthia Carroll – Speech to the Mining Indaba, Cape Town, 8 February 2011 – “Partnership for Success”

Anglo American is one of the world’s largest mining companies focusing on platinum group metals, diamonds, copper, nickel, iron ore, metallurgical and thermal coal. www.angloamerican.com

Mining Indaba attracts mining analysts, fund managers, investment specialists and financiers from around the world. Corporate presentations on the newest and most successful projects provide the foundation for institutional portfolio growth and asset diversification. Government and agency presentations update policies and incentives for potential partners. (Mining Indaba LLC website)

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Partnership for Success

Good morning Ladies and Gentlemen. It is a great pleasure to be with you at this year’s Mining Indaba. I’d like to thank Minister Shabangu for her welcome remarks, as well as her very positive announcement yesterday. Thank you also to Professor Ferguson for his extremely interesting speech, which had thought-provoking insights for all of us.

My theme this morning is partnership. I would like to share with you Anglo American’s belief in the crucial importance of partnership between all stakeholders in the mining sector – a belief reflected in our ambition to be The Partner of Choice.

I am extremely optimistic about the future of our industry. After the severe distress of the financial crisis and a painful recession, the global economy has rebounded, thanks to particularly strong growth in the emerging economies. Even in the turbulent markets of 2010, China delivered GDP growth of 10.3%. And the IMF’s latest forecasts for the years ahead suggest continued recovery in the mature economies and further robust growth in emerging markets, ranging from 9.5% in China to 8% in India to around 5% in Brazil.

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