The global extraction industry has become hallmarked by plundering, violence and political corruption

‘Across the globe, the management of extraction in poor countries rich in resources – by government and the multinationals they invite in – has become hallmarked by scandal, violence, corruption and environmental calamity’

Diamond miners carry bags of earth from their concession near an Angolan village close to the Congolese border. Months can pass by without discovery of any gems. Photograph: Olivier Polet/Corbis

Diamond miners carry bags of earth from their concession near an Angolan village close to the Congolese border. Months can pass by without discovery of any gems. Photograph: Olivier Polet/Corbis

Rafael Marques de Morais’ reports on the links between diamond mining and corruption in Angola draw attention to the growing causes for concern worldwide about the extraction industry

Ed Vulliamy | The Guardian

Index on Censorship could not have awarded one of its Freedom of Expression prizes more estimably than to Angolan reporter Rafael Marques de Morais. In doing so, Index prises open Marques’s principal discourse: the prising open of the land itself by those who plunder for profit without heed.

Marques’s writing in Angola on the links between diamond mining and government corruption draws attention to the growing causes for concern around the world in relation to the industry of “extraction” and how it behaves financially, politically and morally as it pursues sought-after minerals and commodities to fuel economic growth.

Across the globe, the management of extraction in poor countries rich in resources – by government and the multinationals they invite in – has become hallmarked by scandal, violence, corruption and environmental calamity. Vast international conglomerates are often faced with allegations that they abet the plundering of natural resources, usually in league with local officials and almost always to the detriment of indigenous communities. Only a fraction of the wealth accrued from extraction is left in the host country – to say nothing of the communities often “resettled” – ergo forcibly removed – from the land concerned. This nexus of politics and capitalism leads invariably to violence and death.

Ovid, who wrote around 10BC about the origins of man, accounted for the genesis of warfare in these terms: “The land, which had previously been common to all, like sunlight and breezes, was now divided up far and wide by boundaries, set by cautious surveyors. Nor was it only corn and their due nourishment that men demanded of the rich earth: they explored its very bowels, and dug out the wealth which it had hidden away, close to the Stygian shades; and this wealth was a further incitement to wickedness. By this time iron had been discovered, to the hurt of mankind, and gold, more hurtful still than iron. War made its appearance, using both metals in its conflict, clashing weapons in bloodstained hands.”

This pursuit of resources goes on, as does the attendant fallout – environmental, political or economic. Extraction companies seem to find it difficult to fill their coffers without harming people too. The most publicised recent example was perhaps Deepwater Horizon, for which BP was punished speedily because the disaster occurred in the United States.

But BP’s destruction was less than that of Royal Dutch Shell in Nigeria, where – after a litany of spillages, gas flares and other appalling accidents which Shell sought to blame on “saboteurs” and others – nine opposition activists, including Ken Saro-Wiwa, were hanged by the government. Shell stood by, insisting that the company “does not get involved in politics”. The company recently settled with an $84m (£56m) compensation payout over the ravages from two spillages in Nigeria, avoiding the PR excruciation of a high court case in London. Shell admitted that the massive leaks came from pipe corrosion.

“If Shell had not been forced to disclose this information as part of a UK legal action,” said Audrey Gaughran, director of global issues at Amnesty International, which pushed the case, “the people of Bodo would have been completely hoodwinked.”

Oxfam has made extraction one of its priorities. The charity’s southern Africa programme adviser on extraction industries, Titus Gwemende, recently toured Mozambique where the Anadarko company of Houston is preparing to extract natural gas, and found that “key community leaders have been harassed and threatened [by the authorities] if they continue to attend meetings hosted by NGOs on resettlement issues.”

Harassment,” he notes, “tends to precede violence.” It certainly does. I was born on the day of a coup in Guatemala in 1954, staged by the CIA and United Fruit Company, ousting an elected government to protect commercial interests. The country has barely recovered from the legacy of strife sown that day, and Oxfam asks whether its continuation is now embodied by the extraction industry. A recent report finds that where Tahoe Resources of Nevada mines, there follow “crackdown, arrests, false charges” against those opposed to it. Troops opened fire on one peaceful protest.

“Today,” says Oxfam, “we are again seeing a campaign of repression using Guatemalan military and intelligence assets to control the future of economic development. Meanwhile, a US company ignores the backlash and pushes forward with a mine despite overwhelming opposition. Guatemalans should have the right to decide about their economic development and whether or not mining moves forward.”

So land and people trampled, companies armed and rampant. But how does all this happen? Global Witness, based in London, focuses attention in the British capital; much of its work concerns the “enabling” business that facilitates these atrocities.

“It is one thing to go round the world telling people they are corrupt,” says Leigh Baldwin of Global Witness’s special investigations team. “London is a global centre for enablers of mining corruption. London is a hub for many of the world’s most exploitative mining and oil deals. Lawyers, stock exchanges, banks and even the courts have acted as enablers in deals linked to grand corruption, violence and environmental degradation”.

Baldwin cites the so-called “secret sales” scandal in Congo as “one of the most shocking examples of questionable deals by London-listed companies.” He says that Congo “lost out on at least $1.4bn through mining deals struck by blue-chip firms Glencore and ENRC – that’s equivalent to twice what the country was spending on health and education combined.” The companies acquired assets allegedly sold off cheap by the state to intermediaries.

African mining scandals, says Baldwin, “have roots in Mayfair”, while “oil deals in London have links to violence in Congo”. Global Witness claims British oil company Soco International and its contractors “have made illicit payments, appear to have paid off armed rebels and benefited from fear and violence fostered by government security forces in eastern Congo, as they sought access to Africa’s oldest national park for oil exploration.” Soco denies the allegations. Virunga Park is home to one of the last colonies of mountain gorillas – our immediate evolutionary predecessors, facing extinction.

London harbours resistance as well as atrocity. Law firm Leigh Day is to the fore in taking up the cases of those defiled, such as 33 Peruvians who in 2011 won a settlement with UK-based Monterrico Metals – again, the company avoided a case in open court – after they were tortured for protesting against a copper mine, Rio Blanco. The claimants said Monterrico was complicit in the torture, and the death of one man. “We have seen no evidence suggesting the company complained about the police conduct or investigated the protesters’ mistreatment,” said the law firm.

The ONE Campaign, a global grassroots organisation of six million members, seeks to hold governments to their word on the issue it sees as critical to ensure responsible extraction – transparency in the dealings of energy and mining companies.

ONE’s policy director for transparency, David McNair, cites the passing in America during 2010 of the Dodd-Frank law, which overhauls the corporate regulatory system and – among other things – obliges mining and energy companies to declare their dealings with governments. Implementation of the legislation is held up by its being contested by the American Petroleum Institute, “in which Shell and Chevron are prime movers”, says McNair.

“The idea of transparency is getting a lot of traction”, he says, “and the UK has incorporated into law Europe’s equivalent of Dodd-Frank – the European Accounting Directive – quite strongly. But its implementation is undermined by the energy companies; at every stage some big oil companies have been trying to find loopholes – most recently submitting industry guidelines to the UK law that in our view are weak, misleading and contrary to the law. Big oil talks about leading the way on transparency, but their actions are all too often about avoiding it. We are calling on the UK government to reject these guidelines”.

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Filed under Corruption, Environmental impact, Human rights

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