Guineans launch complaint against International Finance Corporation for backing land grab and destruction of livelihood

In the complaint, the communities demanded an independent meditation process in which they can freely express their views and put forward their positions without fear of reprisals.

March 27, 2019 by Pavan Kulkarni
Mining Complaint
In a majority of the cases, people have not been compensated with alternative pieces of arable land where they can continue farming.

540 people from 13 villages in the western part of Guinea filed a complaint against the International Finance Corporation (IFC) – a private sector agency of the World Bank – for financing one of the largest mining corporations in the country, which has engaged in large-scale land grabs and caused widespread destruction of livelihoods in one of the world’s poorest countries in West Africa.

The complaint was filed before the Compliance Advisor Ombudsman (CAO), which is an independent watchdog of the IFC, on February 20, and made public earlier this month. It was represented by two Guinean NGOs, Centre du Commerce International pour le Développement (CECIDE) and Association pour le Développement Rural et L’entraide Mutuelle en Guinée (ADREMGUI). The United States-based human rights organization, Inclusive Development International, is also part of the campaign. The complaint alleged that IFC had lent loan to expand the operations of Compagnie des Bauxites de Guinée (CBG) in contravention of the 2012 IFC Sustainability Framework, which it is obliged to comply with.

49% of CBG is owned by the Government of Guinea, while a majority 51% of the shares are held by a wholly owned subsidiary of Halco Mining Inc, called Boke Investment company. Halco is a joint venture run by US-based aluminum corporation Alcoa, anglo-Australian mining company Rio Tinto and the Guernsey-based Dadco.

CBG, which has exclusive rights to mine bauxite over 579 square kilometers of land in northwest of the country, exports 15 million tons of high-grade bauxite annually. Since the operations of CBG in Guinea began in 1973, numerous communities, which have no share in the mining revenues, have been dispossessed. They have been directly affected by destruction of crops and grabbing of their agricultural land, and indirectly, as the water polluted by mining activities has rendered agriculture on an increasing number of unacquired farmlands unviable.

In a majority of the cases, people have not been compensated with alternative pieces of arable land where they can continue farming. In cases where monetary compensations were provided, the amounts doled out were grossly insufficient to make up for the loss of lands from which villagers could manage a livelihood for a lifetime.

“They’ve expanded into our fields, the areas we depended on for food. And now much of our fertile land has been taken from us.. The company has destroyed our means of subsistence,” a community leader from Boundou Waadé village told the Human Rights Watch last year.

Despite such record of the corporation – which, the complainants argue, is not consistent with IFC’s performance standards set out in the framework – the IFC granted a USD 200 million loan in 2016 to expand the operations further.

“IFC was thereafter required to monitor and supervise CBG’s environmental and social performance to ensure compliance during the loan period. According to IFC policy, if the client fails to comply with its environmental and social commitments as expressed in the legal agreements and associated documents, IFC will work with the client to bring it back into compliance, and if the client fails to reestablish compliance, IFC will exercise its rights and remedies, as appropriate,” the complaint stated. However, the complainants alleged that IFC failed its obligations as more damage was done to the communities in the course of the expansion of CBG’s operations.

Apart from the loan from IFC, the US government’s Overseas Private Investment Corporation lent another USD 150 million to CBG. The corporation also acquired another loan of USD 293 million, guaranteed by the German government through the United Loan Guarantees program (UFK). Further, a number of loans, adding up to USD 473 million, were also borrowed by CBG from a syndicate of commercial banks.

With a total loan of USD 823 million since 2016, the company has embarked on an expansion operation which is expected to eventually increase the annual bauxite output to 27.5 million tons.

Destruction of Hamdallaye village

The infrastructure expansion will further antagonize residents of villages such as Hamdallaye, where about 40% of the ancestral lands have already been expropriated. Destruction of this village, which has existed for at least two centuries, began in 2003 when the company had begun land survey.

Expropriation of land began in 2005, and in 2007, CBG officially announced that it will take over the entire land of the village. Local opposition mounted over the following years until 2015, when an agreement was reached between the company and the villagers.

As per the agreement, the community consented to be resettled, provided that size of the housing was not smaller than the one they were losing and an alternative land was made available to practice agriculture and cattle grazing.

“Although the resettlement of the Hamdallaye village is now imminent, the terms of this agreement.. have clearly not been met. The resettlement site is situated on a barren hilltop with no trees for shade. It is immediately apparent that this site is unsuitable and does not offer, as required by.. [the guidelines in IFC’s Performance Standards], equivalent or better characteristics and advantages of location as compared with Hamdallaye’s current village, which is shady and located on fertile land.” the complaint stated.

The community members also complained that the seven founding families of the village, who customarily own the land allocated for resettlement, were not being compensated.

The company, for the last five years, had been stopping villagers from planting crop on certains areas of land it had demarcated, causing losses which have not been compensated. Further losses were incurred by the community as the company cut off its access to vital water sources.

The report also said that in 2015, CBG started “blasting activities near the water head of Mirirè and artificially deflected it. As a result of the impacts on the water head, the streams of Diarè, Doughoubè and Tabakè dried up. A few years ago, CBG built three boreholes but today only one is functioning.”

This has particularly affected the women, on whom the responsibility of fetching water usually falls. They now have to walk much longer distances and wait in a longer queue before the only source of drinking water the village is left with. “Sometimes women lose patience and fetch polluted water from the source. In addition, the pumping is manual, and requires strenuous physical effort, especially for those who are weak, disabled or of ill health.”

Gardening and palm oil extraction close to water streams, which have been traditional livelihoods of the village’s womenfolk, are also rendered unviable due to pollution of streams from mining activities.

CBG has tricked villagers into signing agreements they don’t understand

While these issues remained unresolved, CBG representatives went to the village in February last year and got many community members to sign compensation agreements. “However,” the complaint stated, “they assert that they did not understand what they were signing and were under the impression that the papers were simple inventories of their possessions. The overwhelming majority of the village cannot read or write, especially women and compensation rules dealing with the size of houses at the resettlement site were very technical and difficult to understand without appropriate assistance.

The organizations representing the complainants wrote a letter to the company’s Director General, raising concerns about the terms of resettlement and non-compliance with IFC’s performance standards. CBG, instead of responding to the letter, sought to yet again get signatures from community members on an agreement which stated that the community recognized that the compensation offered by the company was fair and equitable.

Further, as per the agreement, the community members also waived their rights to challenge the fairness of the compensation. These efforts, the complaint stated, were “presumably aimed at preventing the community from filing this complaint”.

In many other villages, no compensation was provided for the lands grabbed from its customary owners. In some cases, inadequate amounts were paid as compensation, not for land, but only for the crops lost.

Fassaly Foutabhè is one of those villages where even the crops destroyed were not compensated. Here, the company acquired farmlands in Fassaliwol and Kounsi Bana last year, and destroyed the crops and trees on them without even informing the farmers. Only one farmer succeeded in obtaining a compensation, which, however, was less than the price for which he was going to sell his crops.

In the 176-year-old village of Lafou M’baïla, “complainants state that none of these losses of land, including lost trees and crops, were ever compensated, resulting in massive adverse impacts on the life of Lafou M’baïla’s community.”

Pointing out that there have been instances when local authorities have threatened communities for organizing protests, the complainants have sought the intervention of CAO, as a neutral third party, to “facilitate a process of mediation between the complainants and CBG, its majority owner Halco (jointly owned by Alcoa, Rio Tinto and Dadco), and IFC.”

In the complaint, the communities demanded an independent meditation process, in which they can freely express their views and put forward their positions without fear of reprisals.

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