When ArcelorMittal, the London-based international mining conglomerate, amended its contract with the Liberian government in 2006, expectations for development in Nimba County soared. Among other benefits, the contract promised $1.5 million US dollars would be given to Nimba every year to be used on projects and services that would benefit citizens. But over ten years later, the bureaucratic process that administers those funds remains confusing, with limited public information about how they are being spent.
The Mineral Development Agreement (MDA) between ArcelorMittal and the Liberian government stipulates that $1.5 million dollars per year is to be contributed to Nimba for social development, in order to compensate for the effects of its operations in the county. The contribution was to be used on development projects in the county, with specific allotment for communities directly affected by mining activities.
Reports published by the Liberia Extractive Industry Transparency Initiative (LEITI) show that from 2008 to 2015, Arcelor Mittal contributed US$15,497,260.50 to the social development fund in Nimba.
Under the current process, the annual contribution is initially controlled by the Ministry of Finance and Development Planning, where it is placed in a consolidated account and disbursed to the county during a budgetary period that begins from July and ends in June the following year.
However, the manner in which the money is handled is being criticized by Nimba County District 8 Representative, Larry P. Younquoi. And there is little or no public information about what it is being spent on.
Younquoi says the contribution by Arcelor Mittal to Nimba’s County Social Development Fund should be used for projects that will benefit the county and affected communities, but that authorities from the county inappropriately used some of the money to purchase vehicles for use by officials.
In addition, the Nimba lawmaker says that US$300,000 of the $1.5 million should be allotted for affected communities – including Lee-Wehyeepea, Bain-Garr and Yarpeaj, which are affected by the railroad – but that these areas are yet to receive funds that were agreed upon in Nimba ‘county sitting’ meetings.
“As a member of the Nimba Legislative Caucus who is in constant contact with the Executive through the office of the Superintendent, the latest information I have is that Arcelor Mittal has been very, very current in its payment. As far as I know, Arcelor Mittal does not owe us any money, but money given the county has been used to purchase vehicles for county officials instead of using it for projects, and I am clear on this,” Younquoi said.
He warned that if dwellers of these communities do not feel the impact of funds allotted to their areas, tensions could rise.
His concerns reflect an incident that occurred in 2014, when some residents of affected communities in northern Nimba obstructed the road to ArcelorMittal’s mine, setting facilities ablaze, including a wooden bridge linking Yekepa with Sanniquellie.
Parkinson Zuweh, a resident of Zolowii who acts as a representative for community members whose crops were affected by Arcelor Mittal’s operations, said “Those that disturbed the company’s facility were not part of the people to be resettled, but planned to disturb because they wanted job and could not get due to lack of the required skills.”
County officials for whom vehicles were bought include the Superintendent, Assistant Superintendent for Development and Assistant Superintendent for Fiscal Affairs, and County Inspector. The decision to purchase the vehicles was taken in 2015.
Responding to Representative Younquoi’s allegation, former Nimba County Superintendent, Fong Zuagele said, “All decisions with respect to use of the social development fund were taken in our County Sitting from where documents from they are submitted to the Ministry of Internal Affairs and the PPCC.”
Additionally, Zuagele said the decision to buy vehicles and motorcycles was not unilateral, but taken in the county sitting where Legislators, county officials and delegates representing all districts and clans converge and vote upon what they want to see happening with their social and county development fund.
However, efforts to acquire documents detailing the decisions taken at county sittings from Mr. Zuagele were unsuccessful, raising concerns about transparency in the process. Mr. Zuagele said until requested by an auditor he cannot release any document about the cost of vehicles and other activities undertaken during his administration – despite the fact this information is supposed to be publicly available.
The current Superintendent, Dorr Cooper, also said “I cannot comment on that matter because it was not during my administration but Mr. Fong Zuagele. He can best account for what went on that time, not me.”
Since 2012 the General Auditing Commission (GAC) has not released an audit on the amount of money that Nimba County has received from social development fund, and what it was spent on.
However, previous reports covering 2009 to 2012 on the GAC website showed that funds were not properly managed in accordance with the guidelines.
For instance, project guideline 8.5.2 requires that before funds are disbursed, the County Development Management Committee and the chairman of the Legislative Caucus of class “A” and the Superintendent of class “B” must sign the financial documents.
The report said contrary to this rule, seven disbursement vouchers valued at US$43,747 were paid without being approved by the designated authorities.
The report further indicated that unnecessary and bogus payments were made during this period. In one instance, US$14,000 was paid for an office space that not occupied.
Another case showed that US$2,514 was spent to fence a building that was never occupied.
The 2012 GAC report also revealed that a contract was awarded to a bogus entity identified as Wegee Consultant Inc. of James A. Thompson, to which US$12,500 was paid along with an irregular reimbursement of US$4,000. According to the report, $3,107.00 was disbursed to one Prince Forfor, which GAC described as “Strange remuneration to personnel whose hiring is not sanctioned by the guidelines.”
The total of US$5,942.00 was paid in salary to one John Yealue who was said to be a project engineer, but could never be traced.
Decisions about county development fund expenditures are taken in a county sitting that brings together local officials, members of the legislative caucus and district representatives comprising youths and women.
But according to reliable sources, the purchase of vehicles and motorbikes was not taken in the county sitting, but by senior county officials and their colleagues in the legislature.
On this note, Yunquoi said, “Vehicles for county officials should be purchased by the General Services Agency or Ministry of Internal Affairs, and we at the level of the caucus have benefits ranging from vehicles to scratch cards and gas slips. There is no need we be beneficiaries of social development fund, but anyway, since the majority agreed to do, we all did it.”
The head of the NGO Network and Chairman of the Nimba County School Board, Patrick Lah, commented that “Delegates from across the county are illiterate and afraid of losing their jobs and therefore cannot speak against what the higher authorities do. We at the level of NGO are not inclusive in the discussion because the county authorities feel we are radical.”
Meanwhile, 2016 ended another five years of AML’s operation and the agreement is undergoing review. Instead of paying the full $1.5 million that goes to Nimba, Mittal paid $750,000 in 2016 under an agreement with the government to compensate for the decline in the price of iron ore.
According to Yunquoi, “It was a unilateral decision by the President and not in line with the mineral agreement. But Mittal will surely pay the remaining money as far as we know.”
For now, there is no information made publicly available about how much of Arcelor Mittal’s annual contribution has been spent in Nimba, nor who benefitted from those funds. In the absence of an audit, it is impossible to say with certainty what projects have been implemented and who was paid for them.
Jerolinmek Piah, the Presidential Press Secretary, did not respond to numerous email requests for the executive branch’s reaction to Younquoi’s claims.
This story was written as part of a media skills development program run by the Thomson Reuters Foundation and New Narratives and funded by German Development Cooperation. The funder had no say in the story’s content.