Members of the House of Representatives last Thursday voted to audit ArcelorMittal Liberia (AML) in their Extraordinary Sitting and review the Mineral Development Agreement (MDA), and to further establish whether AML is in compliance with its Corporate Social Responsibility and communities relationships.
This is based on a complaint filed before the House by Nimba County District #3 Representative Joseph Sonwabi, but the motion was proffered by Nimba County District #7 Representative Roger Domah and subsequently seconded and endorsed by other lawmakers.
The Lower House also voted to halt AML’s operations until otherwise; all redundant employees should be unconditionally reinstated to their various existing positions, without any technicality of nomenclature within the period not exceeding four months, and those contractors whose contracts were breached should be appropriately paid within the same period and cases of illegal dismissals in which due diligence was not done as required by due processes, and they should be reinstated immediately.
Also included in the recommendations of the Joint Committees on Lands, Mines, Energy, Natural Resources & Environment, Investment & Concessions and Health, which was endorsed by the House’s Plenary, was a mandate that employees who inherited medical problems as a result of the job and have now been considered physically incapable, based on medical advice, should be appropriately catered for and compensated; and that the term “permanent contractor”, which contradicts the fair labor practices and labor laws of Liberia, should be aborted and citizens considered in said categories should be employed within two months.
The mandate added that all unskilled laborers should be recruited, with first preference given where qualified, to those from the affected communities around the areas of operations; and that there should be a guaranteed agreement between the private landowners, among others.
The House’ Chairman on Judiciary Rep. J. Fonati Koffa was the only one who voted against the endorsement of the recommendations from the Joint Committee.
“While issues raised by the Joint Committee’s report were substantial, I did not think we should endorse the cessation of operations of ArcelorMittal Liberia in order to address the concerns. I am concerned at what such a signal would send to the investment community,” Rep. Koffa said.
The Grand Kru County lawmaker maintained that foreign direct investment is an important growth engine for an economy. It injects capital by creating jobs and helps boosts productivity. He argued that investment by foreign multinationals enhances productivity by bringing new technologies to a country.
A staff at the Legislative Information Service (LIS), who begged for anonymity, said given the very weakness of the country’s productivity growth, the government should be making it a priority to enhance the country’s attractiveness as an investment location, instead of scaring away investors with halting cessations and issuing audits on concessions that may lower interest on their investment threshold.
In 2005, ArcelorMittal Liberia signed the first MDA with the government and has since begun mining operations in Yekepa, Nimba County, and Buchanan, Grand Bassa County. This agreement was then renegotiated and amended in 2006.
The MDA carries stringent conditions regarding sustainable development and economic, social and environmental investment. Its aim is to ensure that, while foreign companies are able to generate a profit from their investment in the extraction of Liberia’s resources, the country and its citizens benefit as well.
Among other things, it stipulates that ArcelorMittal contributes $3 million a year to the county’s social development fund (for Nimba, Bong, and Grand Bassa counties). This money, which will be over the 25-year expected lifespan of the mine, will total $75 million and will be used to drive community development projects that will uplift and improve the lives of local people. The agreement also includes commitments to infrastructure development, environmental protection (the dam above is an example of this) and an overall guiding principle of uplifting Liberia and her people.
The company is also required to establish and maintain medical and education facilities in areas of its operations to serve employees, their families, and the broader community and to prioritize the employment and development of local Liberians.