The behaviour of South African mining companies in five countries which have come under scrutiny showed the same characteristics like low salaries for workers, not ploughing back sufficiently into communities where mining took place and most likely not fulfilling their tax obligations fully.
The research included Namibia, the Democratic Republic of Congo (DRC), Zambia and Zimbabwe apart from South Africa.
The book, titled ‘Southern African Mining Companies in Southern Africa – Corporate Governance and Social Responsibility’ was published by the Southern Africa Resource Watch (SARW) and launched together with the Labour Resource and Research Institute (LaRRi).
According to Claude Kabemba, one of the researchers, the research project encountered obstacles such as governments and mining companies being reluctant [to] make some documents available such as development agreements”.
“They argued that these documents contained commercial secrets, their disclosure would impair economic credibility and amount to a breach by states of their commitments under such agreements,” Kabemba said on Friday.
“Maybe the onus lies with the South African government despite the view that it [allegedly] cannot direct how South African mining companies behave outside the country,” the researchers said.
LaRRi Director Hilma Mote presented her findings on Namdeb and Navachab for the Namibian chapter of the book, which she conducted with Iipumbu Sakaria.
Although Namdeb, which is a subsidiary of South African diamond giant De Beers, is 50 per cent owned by the Namibian government, it seems that De Beers benefits more the partnership agreement than the Namibian government,” she said.
“This became clear during the financial crisis, which started at the end of 2008. Namdeb found itself with diamonds the De Beers Diamond Trading Company (DTC) would not buy during November 2008.”
Namdeb thus ran into financial problems, according to Mote, as it did not have enough financial reserves. According to Mote, the Ministry of Mines and Energy realised then that Namdeb did not have reserves and that all the money it earned from diamond sales were used for operational costs.
The book quoted former Mining Minister Erkki Nghimtina as saying in February 2009 that Namdeb is literally the post office through which money is despatched. The money is just for operational costs and the real profits go to De Beers.”
The Navachab gold mine near Karibib, which belongs to Anglo American, came off relatively lightly as it does have a mining closure plan in place, which Namdeb allegedly has not.
The 328-page book recommended that the South African government should design guidelines for the country’s companies outside the country’s borders, particularly regarding the environment and human rights.
RSA mining companies should fully implement their development contracts where they operate.
South African banks should make public their lending practices, the lending partners and monitoring processes of mining projects they fund in the Southern African Development Community (SADC).
Procurement policies of these companies should privilege local businesses in SADC when operating in these countries instead of South African businesses.
SADC governments should review their mining laws and mining contracts to raise revenue from that sector from all mining companies, also local and international ones, not only those from South Africa.
The book also recommended that South African mining companies should make information about their activities in southern Africa available to civil societies in respective countries.
“For this to be effective, SADC governments must have in place access-to-information laws which compel every institution to provide information to citizens when they need it.”
