The true cost of Rio Tinto dividends

| 7th April 2020
Re:Common
Re:Common
Rural people living on the frontline of Rio Tinto’s QMM mine in southern Madagascar are seeing their rights ignored, their lives and livelihoods devastated.

I lived better than a civil servant. Now my eighteen-year-old twin sons are in town begging in the streets.

Another year, another Rio Tinto AGM - but this time round, nobody will be able to attend in person. 

Eryck Randrianandrasana of Publish What You Pay (PWYP) Madagascar had his ticket and visa ready to travel to the UK in order to ask the company a few thorny questions about its subsidiary QIT Minerals Madagascar (QIT), which is mining for minerals in his country.

Join London Mining Network's online week of action from 2-9 April.

Eryck will now hopes to ask his questions via a virtual AGM. At this time of global upheaval, social and economic inequalities are laid bare. Rural people living on the frontline of Rio Tinto’s QMM mine in southern Madagascar are seeing their rights ignored, their lives and livelihoods devastated; they carry the unseen costs of the company’s success and its shareholders’ dividends. Is this a price the poorest people on the planet should be paying? 

Famine

Stock market volatility will be high on many shareholders' agendas this year as they speculate how the current crisis will impact profits, revenues and dividends.

Investors may be troubling themselves with questions of temporary loss of income and stability, but these questions are an ongoing worry for villagers in Madagascar who carry the unseen costs of the QMM mine year after year.

What are these unseen costs carried by some of the poorest people on the planet? 

Rio Tinto’s QIT Minerals Madagascar (QMM) operation has left one community facing famine, in a bid to realise an ambitious plan to deliver a “net positive impact” on biodiversity to the Anosy region where it mines.

QMM has imposed a biodiversity offsetting programme on forests some 50km north of the mine at Begamindidy-Ivohibe to offset the loss of 6000 hectares of indigenous forest where the mine is extracting ilmenite, zircon and monazite.

As a result, the local community of Antsotso who live in this area and who have depended for generations on the forests and lands for food and livelihoods, can no longer practice their traditional agriculture.

'Parasites'

They are now forced to grow food on sandy beaches and poor soils, in practices unknown to them and with little training and support, leaving them unable to secure sufficient harvests to feed their families. The results have been devastating

Despite repeated requests to the company for assistance, people in Antsotso are facing serious food shortages. Like 91 percent of rural people living in Anosy, they struggle with multidimensional poverty, living on less than $1.90 (US dollars) per day.

Antsotso’s traditional agricultural practices have been curtailed by QMM which has employed a local affiliate of Birdlife International, Asity, to manage the offset programme locally. Asity staff regard the villagers with contempt, calling them “parasites” in an interview with a journalist in 2019.

In reality, villagers who have been proudly self-sufficient for generations have had their autonomy stripped away and external ideas of ‘progress’ foisted upon them by outsiders. They are one of the local communities carrying the cost of QMM’s mine. Not just now but into the future, by the next generation:

Clara, a teacher at an Antsotso school, said: “Children in Antsotso like to come to school. Only they are not motivated enough because they are hungry and cannot stay in class until midday. The number of students diminishes because of the financial and food security issues faced by their parents. They do not have enough food.” 

Poverty

Further south towards the QMM mine site at Mandena, along the estuary where the mine operates, local people at Andrakaraka have lost their fishing livelihoods. The lakes are no longer abundant with fish thanks to the building of the QMM weir that has changed inflow of seawater and dramatically reduced fish stocks.

Local fisherfolk have seen their livelihoods decline for almost a decade. QMM’s Independent International Advisory Panel (IIAP) who visited Anosy last November confirmed this negative impact of the mine and is urging the company to address the problem.

One villager expressed the challenge poignantly: “I lived better than a civil servant. Now my eighteen-year-old twin sons are in town begging in the streets.” 

Another priority for communities around the QMM Mandena site is water quality.  Independent expert studies undertaken since 2018 have confirmed lakes and waterways downstream of the mine are contaminated.

The studies, commissioned by the Andrew Lees Trust (ALT UK), found elevated levels of uranium and lead in the waters far in excess of WHO guidelines for safe drinking water. 15,000 people who live next to the Mandena site are largely drawing their drinking and domestic water from waters around the mine.

Pollution

The company’s assertions that QMM’s waste water management is successfully tackling heavy metals from the mining ponds are only that, assertions. Rio Tinto has failed to produce any evidence to substantiate its claims. 

Health impacts from exposure to high levels of uranium and lead include damage to kidneys, bones, and the nervous system; impairment to formation and function of blood cells; increased blood pressure and reproductive problems. 

Jacquelin, from the civil society platform OSC Tolagnaro, said: “We are asking for potable water for the people living around the mines … If it is not too much to ask, we would like the same consideration for us in matters of health as QMM employees receive.”

Uranium levels are more than 50 times higher than WHO guidelines in some places (Swanson 2019). This was raised at the company’s AGM last year with an urgent demand for safe drinking water provision to affected communities. 

Demands made then and repeatedly since by ALT UK, PWYP and Friends of the Earth for Rio Tinto to provide safe drinking water have been rejected. 

Accountability 

Rio Tinto/QMM denies the impactsof the QMM mine on water quality, and is placing the burden for the provision of safe drinking water to communities on the cash strapped Malagasy government.

Eryck of PWYP Madagascar is asking Rio Tinto how it justifies its claims that QMM’s breach of an environmental protection zone had no impacts on waterways, especially when the company cites the state regulator, the National Office for Environment (ONE), to validate its assertions:

“It’s clear the ONE did not conduct any studies to establish the impact of QMM’s breach. Our national regulatory bodies do not have the capacity to measure QMM’s performance against realistic indicators.

"We need the independent studies. Local QMM consultation processes are not transparent and local people have no means to hold the company to account when they do not adhere to approved commitments”

Meanwhile, local people continue to fish and draw drinking water from contaminated waters. Local people complain of increased illnesses since the QMM mine began, and in January 2020 a number of Malagasy civil society organisations wrote to the President of the Republic calling for a social and environmental audit of QMM.

Costs

The QMM mine was advanced on a promise to lever the Anosy region out of poverty. If so, then what price safe drinking water? What price for ensuring parents in Antsotso and Andrakaraka can feed their children and secure them a decent future? 

The cost of the losses and instability to villagers’ lives in Antsotso and Andrakaraka cannot be easily quantified since, as well as the loss of food security and livelihoods, it includes also their pride, autonomy, rights, spiritual wellbeing and hopes for the future. 

What price should be placed on these? What is the real cost of Rio Tinto’s dividend? While reflecting on this, Rio Tinto shareholders may do well to consider the company’s legacy in other fragile settings, and the cost of legal and reputational risks if it leaves the problems in Anosy unaddressed. 

In Madagascar, the famine in Antsotso, the loss of livelihoods at Andrakaraka, and the contamination of waterways around Mandena outweigh Rio Tinto’s claims that its QMM mine is providing a global model for “green” and “sustainable mining”.

This Author 

Yvonne Orengo is director  of the The Andrew Lees Trust and has jointly worked with Publish What You Pay (UK and Madagascar) as well as Friends of the Earth (UK) to maintain pressure on Rio Tinto to urgently provide safe drinking water to affected communities, manage waste waters, improve transparency and communicate openly with local communities.

For more information on what you can do, see here. You can also join the online week of action from 2-9 April, with London Mining Network.

Image: Re:Common

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