Haiti’s mines – “Open for business?”
Mining companies appear to know that now is likely the best time in years to move into Haiti: the country has low royalty rate, there are peacekeepers stationed throughout the country, a giant free trade zone and new deep-water port are being built in the north, minimum wage is the lowest in the hemisphere, and all signs indicate that the new government will write business-friendly laws.
No wonder Majescor CEO Dan Hachey applauded the 2011 election of President Martelly, saying, “Martelly has stated that [Haiti] is open for business. We’ve seen a lot of change since he’s been elected.”
The revolving door that landed ex-Finance Minister Ronald Baudin on the Newmont team might be one reason for the change. While still in power, he agreed to deals like a cost-free, 50-year lease of land to a French company in the north.
“We didn’t rent it – we made it available to them,” Baudin told HGW. “Because, when there is something that is good for the economy, the government has the obligation to encourage it.”
Haiti’s new prime minister – Laurent Lamothe – is also very pro-business. A telecommunications and real estate entrepreneur with companies in Africa and Latin America, he has pledged to push through business-friendly legislation in all sectors, including mining.
“Information on our national reserves indicate that our land is rich minerals and that now is the right time to exploit them,” Lamothe said in his policy speech before the Senate on May 8.
Lamothe also promised to change mining law. In a recent interview with the Associated Press, Lamothe pledged the new law would assure “the right portion comes to the state” and that it also protects the environment and local communities. But, he hedged, the new legislation would do so "[a]s much as possible without hampering also the revenue of the party, allowing them to do business."
Even before Lamothe took office, Anglade told HGW he was aware of the move to change the existing law.
“I should tell you that the companies are doing all kinds of lobbying to get the law changed so that it gives them more advantages. But they have too many advantages already!” he said.
A gold miner in Lakwèv holds the gold chunk he just found. People in that
region dig tunnels and pan for gold, and then sell it to traders from the cities
or from the Dominican Republic for about one-half market rate.
Photo: Ben Depp
Can a government whose motto is “Haiti is open for business” and which is staking its bets on assembly factories and a $5-a-day minimum wage (the lowest in the hemisphere) be trusted to protect the country’s interests?
Mining giants have consistently gone up against much stronger states and have gotten contracts that mostly benefit their shareholders. What guarantee do Haitians have that pro-business Lamothe will get a better deal than the governments in Peru, Ghana, or other poor countries?
The potential for mining revenue and even some low-paying jobs sound good to many in Haiti, where most people have to survive on less than $2 a day and where un- and under-employment tops 66 percent. But is mining the answer to Haiti’s woes?
For Laurent Bonsant, a Canadian mining contractor working for Newmont Ventures in the north, the answer is “yes.”
“The one thing this country needs is something to export. They got nothing. If mining can do any good, it will do good here,” he said as he supervised a site where a team was drilling 24 hours a day for core samples 330 meters down.
But Haiti has several exports, and more importantly, in the past, mining has not done much “good.”
In recent decades, foreign companies mined bauxite and copper. Tens of thousands of families lost their land, thousands of hectares were deforested, and in some cases, land was poisoned.
Women pan for gold in Lakwèv. People in this village have been digging
or panning for gold since the 1960s. As gold price increased in recent years,
now as much as 80 percent of the population is involved in the local "gold
rush." Photo: Ben Depp
Professor Alex Dupuy, Chair of African American Studies and John E. Andrus Professor of Sociology at Wesleyan University, is highly skeptical that the new ventures will produce results much different than their predecessors. Even though Haiti is no longer controlled by a dictatorship as ruthless and corrupt as that of the Duvaliers, there is little transparency, and no apparent means of auditing or controlling local and foreign investors.
“I think the same thing is going to happen,” said Dupuy, author of Haiti in the World Economy – Class, Race and Underdevelopment, in a telephone interview with HGW. “The mining industry doesn’t employ a lot of people, and the local ones it will employ will be unskilled labor. The cadres will come from overseas because usually these companies come with their own technology.”
“As in the past, they will expropriate peasants’ land. So, it will be the same thing, all over again. The contracts being signed will be what the foreign company wants, not necessarily what is in the best interests of the country, even if they present it to the public as something that is good for the country.” [See also Haiti’s Grim History of Being “Open for Business”]
Guatemala – a country socially, economically and politically similar – thought mining could “do good” there, too, and let Goldcorp open the Marlin Mine. But in 2010, the Inter-American Commission on Human Rights called on the government shut it down temporarily due to health, environment, and human rights risks. A 2011 report by mining experts associated with Tufts University recommended that Guatemala significantly change the rules of the game: demand higher royalties and other revenues, assure better environmental protection and cleanup, and guarantee some monies reached host communities.
“Without good governance and productive investment, the local legacy of the Marlin mine could well be ecological devastation and impoverishment,” the authors wrote.
Anglade is worried something similar could happen in Haiti, where government control is virtually nil. For example, although it is illegal to cut down trees, freshly sawn wood is stacked for sale in marketplaces all over the country. Today Haiti’s tree cover is just 1.5 percent.
Up north, many of the farmers who might have benefited by leasing their land to mining companies sold out long ago to savvy land sharks and businessmen associated with previous mining ventures in Grand Bois, a Eurasian site. Over a dozen families now farm land they no longer own.
Anglade remembers well.
“When I heard that was happening, I went up there myself, to tell people not to sell, because there was gold in the land,” he said. “But they sold.”
Today, the poor families who still farm those lands as tenants, and hundreds of their neighbors, are worried about pollution and about being kicked off their plots. Last year, over 200 families were ousted from a nearby fertile plain when the Martelly government inaugurated a new free trade zone.
In one region, Newmont has done some “social works,” according to Anglade. The company built a small bridge, a road for its little all-terrain vehicle and paid some school tuitions. Farmers are still nervous.
“They say the company will need to use the river water for 20 years, and that all the water will be polluted,” explained farmer and peasant organizer Elsie Florestan, who lives near the Grand Bois site. “They say we won’t be able to stay here.”
Elsie Florestan stands on top of a mountain near a Newmont/Eurasian
Grand Bois drill site. Photo: Ben Depp
“The small group of people who’ve gotten jobs are in favor of mining, but that’s 50 people!” added the 41-year-old, a member of Haiti’s Tèt Kole Ti Peyizan Ayisyen (“Small Haitian Peasants Working Together”) peasant movement. “If we don’t organize and make some noise, we’ll be completely pushed aside,” she warned.
Florestan and other farmers have been watching mining crews take tens of thousands of samples from every hill and dale for years, all across the north.
“They don’t even ask you who owns what land. They come, they take big chunks and put them in their knapsacks and they leave,” noted peasant organizer Arnolt Jean, who lives in Lakwèv, near the Dominican border. “All of us are just watching. We need a government that controls what is going on, because we don’t have the capacity to do that.”
A man inside a 40-foot long tunnel where he digs for gold. Photo: Ben Depp
In his community, people have been panning for gold and digging their own tunnels for generations. A day’s or week’s work might result in nothing, but it might also bring up to $5 or even $50 worth of gold, although Dominican buyers usually pay only about half market price. Still, with most families too poor to even send all their children to school, many take to the hillsides and riverbeds once they have planted their crops. The landscape is pitted with holes. The river runs brown with mud.
Arnolt Jean looks at a mining tunnel in a neighbor's front yard. Photo: Ben Depp
“Our country is poor, but what is underground could make us not poor any more,” Arnolt said. “But since our wealth remains underground, it’s the rich who come with their fancy equipment to dig it out. The people who live on top the ground stay poor, while the rich get even richer.”
End of part 4 of 4 parts
Read Haiti’s Grim History of Being “Open for Business”
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