Haiti’s gold – is the country ready to exploit its unearthed riches?

23 March 2015 (Last Updated March 23rd, 2015 18:30)

Haiti is believed to have enough gold to lift the earth-quake hit country out of poverty. But as the government, with assistance from the World Bank, works to exploit these treasures civil society groups are keen to ensure it is done responsibly, with many asking: is Haiti ready for widespread mining?

Haiti’s gold – is the country ready to exploit its unearthed riches?

Haitian palace

"Haiti would like to place itself as an emerging mining country in the next 20 years," former Haitian Prime Minister Laurent Lamothe told a mining conference in 2013.

It's impossible, at this stage, to ascertain the exact potential of mining in Haiti, but $20bn is a figure often floated. This estimate stems from a reported $30m of exploratory drilling by US and Canadian investors in 2012 which unearthed gold, silver and copper.

To put this figure into context, the country's annual GDP is $8.459bn (2013) - therefore mining could propel the poorest country in the Western Hemisphere to prosperity.

From 2008, for more than four years, Newmont Ventures Limited, a subsidiary of US based Newmont Mining, and Canadian Eurasian Minerals conducted mineral exploration in a 130km trend of northern Haiti's Massif du Nord. In 2012 the companies said they had identified several areas of interest warranting further exploration and signed a memorandum of understanding with the Haitian government for drilling beneath ground surface.

Full-scale mining, however, has been on hold as the government, assisted by the World Bank, drafted a new, business friendly mining bill.

Lamothe said the country needed a mining code that is "modern and precise" and that must "allow for transparent contracts with competent experts who have national interests at heart."

Civil society groups have, however, criticised the process of drawing up the mining bill (which was leaked, not published) and lodged a complaint on 7 January - since rejected - with the bank's inspection panel, its independent accountability mechanism, saying the process went against the bank's own policy of transparency and meaningful public consultation and was effectively conducted "behind closed doors".

This, and other concerns raised by civil society groups, bring into question Haiti's readiness for large-scale mining. The issue is further compounded by the fact the Haitian government is in crisis - the parliament was dissolved in January and a de facto prime minister swiftly sworn in - creating the possibility that the new mining bill may be adopted by decree, outside the democratic process.

World Bank compromises its credibility

"Our big concerns are about transparency and participation; just ensuring Haitians decide about their future and those include the ones directly affected," says Margaret L. Satterthwaite, professor of clinical law, faculty director of the Center for Human Rights and Global Justice and director of the Global Justice Clinic.



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Satterthwaite, who has more than years' experience working in Haiti, helped lodge the complaint to the World Bank's inspection panel. With the clinic she works alongside civil society groups, known as the Mining Justice Collective, and local communities in Haiti to promote an economic and human rights based approach to mining development.

So far, she says, those at the discussion table have been mostly government officials, representatives from the mining industry and the World Bank, which, through its private investment arm, the International Finance Corporation, has a stake in Eurasian Minerals.

This can be seen as a conflict of interest or a positive alignment of interests depending on whether the bank ensures complimentary safeguards as would be expected. However, Satterwaite says "this has not been done so far".

Global program manager at Oxfam America, Keith Slack, says the bank has a somewhat "problematic track record" in this regard.

"Ghana is a good example," he says. "The bank brought foreign mining companies to Ghana in the 1980s...a valuation the bank's internal unit did a few years ago raised some serious questions as to how much the country had really benefitted from this."

When asked about its work in Haiti the World Bank said it had been providing "technical assistance" to the Haitian government, adding: "As part of the advisory services provided to the Government of the Haiti, the World Bank emphasized the importance of conducting comprehensive consultations with civil society and local communities in particular."

Communities already concerned

According to the Accountability Counsel, communities have already reported negative impacts and rights violations caused by initial prospection and exploration activities.

"Companies have reportedly drilled and dug holes on community land without telling landowners."

Companies have reportedly drilled and dug holes on community land without telling landowners who they were and why they were there. Other issues highlighted were agreements being signed by unauthorised third parties and attempts to conclude agreements only after the company had worked on the individual's land.

It's not clear what companies these were, but other corporations reported to have a stake in Haiti's minerals include VCS Mining and Majescor Resources.

A Newmont spokesperson said that while the company was in Haiti it held a "consultation with local communities and land owners /0 users prior to any land exploration... Representatives worked with local communities on exploration access agreements, local employment, environmental management, monitoring and reporting with host communities and government authorities."

They added the company suspended activities in Haiti in 2012 and currently does not have government or company director approval to build or operate a mine there.

Do Haitians want mining?

Other issues Haitian civil society groups have raised include information not being published in Haitian Creole but only in French, which is spoken by only a small number of the population, and a lack of education about mining.

"Some people have never even seen a photo of an open pit mine so they don't understand the scale and the kind of processes involved," says Satterthwaite.

In January of 2010 Haiti was struck by a magnitude 7 earthquake which devastated the country and killed around 200,000 people. Five years on, the country is still very much impoverished, listed 168, just before Afghanistan, on the UN's Human Development Index.



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This isn't lost on Haitians. Many are very welcoming to the idea of mining and foreigners - Haitians are typically very hospitable, says Satterthwaite - but there is an "overall level of concern" says Slack.

"Some people think the best option would be to leave the gold in the ground while others think this could be an opportunity for Haiti," he adds.

Asked whether he is in favour of mining if done properly Camille Chalmers, member of the Mining Justice Collective and director of Haitian Platform for an Alternative Development (PAPDA), says "[this] is not a question that can be answered well."

"The important thing," he adds, "is first defining consultations, options, paths to prosperity articulated around the needs and interests of majorities and the national market.

"We are a country of small size exposed to significant risks - hurricanes, floods, earthquakes - we are experiencing a serious ecological crisis with a destroyed forest cover.

"These conditions do not allow us to enter mega mining activities incompatible with the strengthening of our geological and agriculture needs."

He says PAPDA has had only "limited exchanges" with Newmont and Eurasian.

"We are a country of small size exposed to significant risks - hurricanes, floods, earthquakes."

"We are facing companies and powerful interests with corrupt political alliances and sectors willing to accept contracts and commitments that go against the interests of our country...we are ready to fight," Chalmers adds.

Lack of governance

In late March Oxfam will publish a report analysing the draft mining law and the governance challenges within Haiti.

Satterthwaite says it is clear the government structure and human resources are not there to be able to adequately monitor a thriving mining sector.

"There needs to be a much stronger state with human resources and person power and infrastructure. Corruption is definitely a concern."

The clinic, in conjunction with the Mining Justice Collective, has been granted a hearing on March 17th at the InterAmerican Commission of Human Rights on the issue of access to information where they will be given the opportunity to discuss these issues with the government of Haiti, if they accept the invitation. The US Haitian Embassy has yet to respond to a request confirming if they will be attending or not.

Lack of government oversight could lead to bad management of mining revenues and devastating environmental effects.

"We want to ensure water resources are protected, which local communities use for small scale farming, the main livelihood in rural Haiti, where most of the mining would take place," says Slack.

As well as treating communities on an equal basis, and abiding by environmental regulations, Keith notes that companies should disclose all contracts signed between them and the government, as well as all payments between the government and mining companies.

Newmont, he adds, is an industry leader in disclosing payments, as is required by the US Dodd Frank Act, but its track record in places like Peru, where it has faced much resistance to mining, has been sketchy.

What next?

Mining companies are waiting to see what happens after the six month consultation period for the current mining draft is over later this year.

With proper consultation and procedures, Haiti has an opportunity to avoid repeating a story seen all too often in developing countries: the resource curse, where the exploitation of national riches fails to create positive social change, but instead breeds environmental devastation, disgruntled communities and corruption.

It remains to be seen whether mining will be the making or the breaking of the country.

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