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Nimba’s Mining Towns Decry Government’s Allocation of ArcelorMittal Social Development Payment

AML Stakeholders and Team

Yekepa, Nimba County – Since ArcelorMittal Liberia (AML) began operations in Nimba Liberia, the company has faced a series of violent demonstrations and disruptions from local communities, especially affected communities in Nimba County where its mines are located. Brand Bassa County has seen a few of these protests but mostly for a limited period.

These protestations have included roadblocks, some have seen an ore carry train set ablaze, while men carrying guns and machetes have been attacking the mines at times wounding staff and police officers. The most recent protests resulted in blockades at AML’s three mining sites in Nimba, leading to the evacuation of staff after residents brought “bush masters,” also known as “country devils,” to the mines, shutting down the company for over a week.

Adding to these disruptions, a group of unknown men said to be from Zolowee, a town near ArcelorMittal’s concession area where the company is constructing a massive ore concentrator, attacked ArcelorMittal’s Tokadeh Mines in mid-July 2023. The gang, armed with single-barrel guns and pistols, also carried machetes to the mines, shot an employee, and wounded a police officer on duty. They then ransacked and damaged the Crusher Plant Control Room, a vehicle, and a large welding machine.

Additionally, over the years, ArcelorMittal Liberia has been grappling with increased fuel theft from surrounding towns and villages in the mining areas, leading to operational losses.

A team of journalists from FrontPageAfrica recently concluded a two-day fact-finding mission to Nimba County to engage with stakeholders in the affected communities. Their goal was to understand the root causes of these agitations, particularly, since it has been confirmed that AML has paid over US$48 million to the government of Liberia since 2006, as County Social Development Fund (CSDF), and to explore potential solutions for lasting peace in the concession area. The journalists’ interest was incited by the potential drawbacks of attracting foreign direct investments (FDI) to Liberia, especially, in counties hosting existing concessionaires where these sporadic disruptions happen.

Community Dissatisfaction and Agitations

During their visit which began on June 22, 2024, the journalists discovered several key issues contributing to community dissatisfaction in the AML mining areas.

Community members, including chiefs, elders, women, and youths, are aware that AML pays money to the Liberian government in taxes, royalties, and other fees, including corporate social responsibilities (CSR). However, they are largely unaware of the exact amount paid since AML began operations in 2006. They were shocked to learn from the journalists that AML has paid more than $48 million in CSR funds to the three affected counties and that according to documents seen by the reporters, and does not owe the government of Liberia and affected communities any arrears. The company makes this payment every December directly to the consolidated account the government operates at the Central Bank of Liberia intended to address development challenges in affected areas where the iron ores are mined.

According to ArcelorMittal Liberia’s Mineral Development Agreement with the government of Liberia, CSR funds are intended for constructing hand pumps, roads, schools, and health centers, as well as for the provision of scholarships in the affected communities to build human capacity. Notwithstanding, the communities reported not benefiting from these funds, as they still lack basic amenities such as safe drinking water, access roads, and any form of empowerment. Decisions regarding the expenditure of county development funds they say often do not reflect the communities’ needs and preferences. This disconnect has left the residents feeling neglected, unheard, and bewildered.

Another important grievance is the high unemployment rate among youths in the affected communities. The residents feel that AML has not provided sufficient job opportunities for their children, exacerbating their frustrations. To this claim, a senior member of the company presented a long list of local employees and acknowledged they have to do more, and are committed to doing so.

The Rationale Behind Targeting AML

The community members explained that their demonstrations often target AML because they do not interact with the government regularly. AML’s visible presence and daily operations, including the transportation of iron ore, make the company an immediate focus for drawing attention to their grievances.

As one elder expressed, “It is frustrating to see massive iron ore passing by you in a train daily when you and your children can’t even find food or safe drinking water. If you were me, what would you do?”

Another resident questioned, “If the government cannot bring the money, why can’t Mittal herself give us the money directly so that we can get the things we need ourselves? We, the poor people, should be able to decide what to do with the money.”

The journalists reminded the community members that public financial management laws as they are now do not permit ArcelorMittal Liberia to transfer money directly to the communities. Instead, the law requires the money to go to the government, which is then responsible for applying it to the needs of the people for development. Sadly, this has not been the case as affected communities cannot boast simple things like water, medication, or access roads despite the payment of more than $48 million over the years.

Proposed Solutions for Lasting Peace

To address these pressing issues and foster lasting peace between AML and the local communities, several measures have been proposed.

A swift amendment to the public financial management law is essential to ensure that all payments for public obligations, like the County Social Development Fund (CSDF), are either applied by concessionaires in affected communities or directly deposited into the concerned county’s account and ensure that the communities decide on the use of said funds. This would enable the affected communities to benefit directly from these funds, help calm agitations, and protect the country’s investment image and reputation in the outside world.

Collaborating with lawmakers from the affected counties to garner overwhelming support for reforms that ensure CSDF payments are directly allocated to the communities will help bridge the gap between the communities and the benefits they are entitled to.

Global Examples and Local Implications

The concept of directly allocating Corporate Social Responsibility funds to local communities is not new and has proven successful in various parts of the world, particularly in Africa. A notable case study is the Niger Delta region in Nigeria, where oil companies have faced significant unrest due to environmental degradation and lack of local benefits. To address this, some oil companies have started community trust funds where a percentage of their profits are directly managed by local communities for development projects. This approach has led to a reduction in conflicts and has empowered communities to take charge of their development.

Similarly, in South Africa, the Royal Bafokeng Nation, an ethnic group in the North West Province, has successfully managed the royalties from mining companies operating on their land. The community has used these funds to build infrastructure, schools, and hospitals, largely improving their quality of life.

Implementing a similar model in Liberia could yield positive results. In the face of the Liberian Government’s decentralization efforts, direct allocation of CSR funds to the affected communities in Nimba, Grand Bassa, and Bong Counties would ensure that the funds are used for the intended purposes, such as building infrastructure, providing clean drinking water, and creating job opportunities. This direct involvement in their development would likely reduce frustrations and violent protests.

Moreover, this approach would serve as a motivation for other countries in Liberia to seek investment. Knowing that they would directly benefit from CSR funds, communities would be more inclined to welcome and protect investors. This would create a favorable investment climate, leading to overall economic growth and development in Liberia.

When communities have a direct say in how their money is spent, as opposed to central government control and direction, it promotes transparency, accountability, and empowerment that can address immediate grievances and advance a sense of ownership and responsibility. It can motivate communities to protect and sustain investments, thereby contributing to long-term economic growth and stability. By implementing these solutions, it is hoped that the grievances of the communities can be addressed, fostering a more harmonious relationship between residents and ArcelorMittal Liberia-the country’s biggest tax-payer and chief employer in the private sector, peacefully continue its mining operations in Nimba County.

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Traditional Chiefs and Elders in Nimba Vow to End Citizen Demonstrations Against ArcelorMittal Operations

“We wish to go on record with a vow that as long as ArcelorMittal is ready to work with us, listen to us, and adequately address our concerns, there will be no reoccurrence of citizen-led demonstrations as we realized in the past,” stated the resolution, signed by Lawrence T. Tokpah, Sr., Secretary General, and approved by Chief Robert Senneah, Chairman of the Chiefs and Traditional Elders Council of Nimba.

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