Exploitation of Mineral Resources in Mozambique: A brief look at the conflicting nature of the business

The exploitation of mineral resources for some time has occupied a prominent place in public debate in Mozambique. In the list of the questions surrounding the issue are concerns such as: How to transform them in development engine factor? How to ensure the transparent management so that they may be a gift and not curse? What about the training of qualified human resources; Fair compensation; Sustainability; and so on.

In recent weeks the issue of just compensation came to light when on January 10^th, about five hundred people barricaded and blocked access roads and the rail road in the area of ​​CATEME district of Moatize, Tete province, demanding the government and the mining company Vale to comply with a series of promises of resettlement packages related to access to water, fertile land, health, energy and housing better than that offered by the Brazilian multinational.

This incident motivated by the question of just compensation appeals and raises a rethinking of the role of the Government, State Enterprises and the rights of communities directly affected with mining mainly by the Government's police response to the communities claims.

The Mozambican mining experience is impregnated with a huge potential for conflict between the parties involved in the business (affected communities and civil society in general with the Government and Business operator) ie, it presents a conflicting nature to lack of transparency that characterizes the business.

1^st Because the contracts between the government and the mining companies remain a secret (not public). Not being in the public domain the rights and obligations, the amounts involved, it is impossible to understand the extent to which companies comply with their contractual obligations and if there really is some fairness in the business. It is basically in the contracts that are or should be safeguarded all matters related to the social responsibility, sustainability, externalities and to just compensation.

Once the contracts are not in the public domain, the issue of just compensation will tend to present itself always problematic, imbued to a certain point on misinformation, exaggerated expectations, opportunism, dishonesty, etc.. This question appears to be dominant in the majority of mining projects.

2^nd And because the question of just compensation is at first sensitive and problematic. It involves non-quantitative and quantitative aspects as the value to be buried beside the grave (tomb) of the father, the family, the value of the socio - cultural link with the land, birthplace and ancestors, and so on. What is the entity that actually measure and how to evaluate or measure the fairness in compensation? These are things that have relative subjective value but should be offset objectively by a determined value. So it is the company or the person affected who will stipulate the value in cause?

Often in these cases companies seek to assign a default value or build model houses, all the same for people coming from different realities and situations (different houses in color, space, etc.).

There has not been taken into account that in the communities where they lived these very same people were stratified economically and socially, there were different social classes and power relations, to put all in the same neighborhood and model houses in  CATEME, the company should take into account these aspects and dormant conflicts. People do not profess the same religion, so how are they seized with these issues because people do not live only of material interests but also spiritual.

3^rd Because of the Government's actions in this business is far away from the classic role of the state and the purposes of ensuring the well-being, justice and security.

Abraham Lincoln wisely defined democracy as a Government of the people, by the people, for the people, which means that it belongs to the people and is geared for and by people.

Now, the exploitation of mineral resources and in this case of January 10^th the events in Moatize, the government action in no way emanated from the general will and did not answer the concerns of the communities affected by the resources exploitation. Rather than mediate, dialogue and bring the parties to the balanced solution, the Government used a police response by repressing the population.

Vale, in turn, affirms clearly that the government is exempting itself from its responsibilities in the business. However, this is because the Government which had the mission of serving the people do not do it when it keeps silent about the contents of contracts with mining companies, opening the room for speculation, lack of transparency, opportunism, misinformation, which in turn feed these conflicts.

The Government does not dialogue, does not inform, is not clear to the communities and civil society in general, giving way to misunderstood and avoidable conflicts.

Before this emptiness or the apparent omission of the Mozambican State it is the role of the companies to assume the role of implementing the common welfare?

However due to their nature private companies (driven by profit) cannot replace in any way the government and State role in pursuit of welfare, justice and security.

So neither Vale nor any other entity should be at the forefront of the process of just compensation, promotion of local development through the establishment of socio-economic infrastructures such as those enrolled in Cateme.

Company’s role is to get profits in the social and environmentally responsible and not pursue the development of the communities where they operate as goals.

Social corporate responsibility can be used to induce and promote local and national development but when they are framed within a broader development strategy defined and coordinated by the Government and civil society itself and not by companies.

So that this situation does not repeat more times and take on other dimensions is necessary to have an open dialogue between stakeholders, beneficiaries and affected communities, in relation to the expectations, scope of business, rights and obligations of the parties, sustainability, and social responsibility among other issues.

We must be aware that the rule is a function and not a right, is a public service whose owners or customers is the people. Nothing more fair in this case than to inform the people about the main issues of their concern, accounting, consulting in the search for alternative solutions of the same problems.

Frequently asked questions on IEA collective action

How many times has the IEA undertaken such a “collective action”? When was the last time?
On a global scale, this is the third time IEA member-country stocks have been used. IEA member countries released oil stocks in 2005, after Hurricane Katrina damaged offshore oil rigs, pipelines and oil and gas refineries in the Gulf of Mexico. The only other occasion IEA member countries mandated a stock release was at the time of Iraq’s invasion of Kuwait in 1990/1991.

How exactly will stocks be made available to the market in each of your member countries? What mechanism is used?
Member countries have different stockholding systems.  Some have large reserves of public stocks, like the US, Japan and Germany, which can be offered to the market through loans or sales.  Other countries have sizeable stockholding obligations on commercial oil industry operators which can be lowered in order to make these volumes freely available to the market.  In some instances, a combination of public stocks and reduced obligation on industry is used, and it would be up to each country to decide how make additional oil available to the market.  Finally, stocks can be in the form of crude oil of various grades, products or a mixture of the two.

How much time will it take for these stocks to become available?
Oil supplies from IEA member countries should begin hitting the market around the end of next week.

How much oil will each country release? Will each country release the same proportional amount, or will some countries do more? How is that decision made?
Country shares are based on their proportionate share of total IEA oil consumption – so larger oil-consuming countries obviously have a bigger share in the overall release. In this case, all IEA countries holding strategic stocks and representing more than 1% of IEA final oil consumption are participating. It is expected that North America will release 50 percent of the total, with European countries releasing some 30 percent and Asian countries providing the remaining 20 percent.
The IEA will produce a tally once it has a clear indication of the types of oil that each country will make available.

Has the IEA consulted with OPEC or Saudi Arabia on this decision? Would this IEA action not discourage Saudi Arabia and other willing OPEC members from increasing oil production?
The IEA and its member countries have been in close contact with key oil producing countries, and in particularly with Saudi Arabia, which holds the lion’s share of OPEC’s spare capacity.  The IEA welcomes the announcement made by Saudi Arabia that it intends to make incremental oil available to the market.  However it will take time for these incremental barrels to be produced and shipped to consuming markets; the use of IEA strategic stocks now will help bridge the gap until these new supplies are available.
Producers and consumers have a common interest in stabilising oil markets.  This point has been highlighted many times before, and is a reason for the IEA’s close liaison with key oil producing countries at all times.

I thought the IEA only does this for supply disruptions in excess of 7%. The 1.5 million-barrels-a-day disruption from Libya doesn’t seem all that much, given that global demand is around 88 mb/d, so why go to all the trouble?
As far back as 1984, IEA member countries understood that a disruption of a much smaller scale than 7% could cause significant economic damage, and thus they adopted more flexible response measures.  The two previous emergency IEA actions, in 1991 and 2005, each accounted for less than 7% of world demand.  Particularly in a tightening market such as the one we see currently, a relatively small disruption can have a significant impact on the market.

If the disruption from Libya is 1.5 million barrels per day, why are the IEA member countries releasing 2 million barrels per day?
By the end of May the Libyan crisis had removed 132 million barrels of crude from the market. Commercial stocks in the OECD countries have tightened as a result. Because crude demand peaks during the summer season in the Northern Hemisphere, we estimate that preventing further market tightening in the third quarter will require 2 million barrels per day of additional supply. Our action aims to provide market liquidity until incremental production comes to the market.

Libyan supplies have been off the market since February. Why are you only doing this now?
The IEA is prepared to act when there is a significant supply disruption or an imminent threat thereof.  Since the Libyan crisis began, the market has focused on the potential for further tightening in both OECD industry stocks and OPEC spare capacity.  The onset of the Libyan crisis fortuitously coincided with the peak of the European refinery outages, primarily linked to seasonal maintenance work, and thus lower demand for crude oil.  Now, heading into the “driving season” in the Northern Hemisphere, demand for crude will rise as refiners seek to replenish product stocks ahead of rising transport fuel demand.  This seasonal increase in demand, combined with OPEC’s announcement at their 8 June meeting not to increase production to fill the gap with the necessary additional supplies, represents an imminent risk, which is why the IEA has chosen to take decisive action now.

Are IEA countries not putting at risk their capacity to react to more serious oil disruptions that may happen in the coming months considering geopolitical uncertainties in MENA countries?
No; IEA countries benefit from a very large safety net with their stocks:  Total IEA stocks amount to more than 4 billion barrels, of which 1.6 billion are public stocks held exclusively for emergency purposes. This is equivalent to 146 days of net imports. So even after this 60-million-barrel collective action, all participating countries’ stocks will remain above 90 days of their net oil imports.

Several analysts say this is only likely to have a short-term effect on the market, and that prices will be higher in a month’s time. What’s your response?  Will you extend this by 30 days? How will you decide?
Markets move based on today’s fundamentals and expectations of future supply and demand.  The coming months, as we head into the driving season, would likely see the impact of the Libyan crisis felt most keenly;   this is why the IEA is acting now.  Some producer countries have announced their intentions to raise production, but it takes time for these incremental barrels to be produced and shipped to consuming markets. The use of IEA strategic stocks now will help bridge the gap until these new supplies are available. The IEA will continue to monitor the situation.  If supply remains disrupted and markets remain tight in the future, the IEA does not exclude another decision to make additional supplies available to the market. 

Isn’t the IEA effectively doing this to counter high prices – and in that sense isn’t this fundamentally different from a traditional release in response to a supply disruption? Doesn’t this therefore set a bad precedent, by making the IEA a market manipulator?
The IEA is prepared to act when there is a significant supply disruption or an imminent threat thereof.   Since the Libyan crisis began, the market has focused on the potential for further tightening in both OECD industry stocks and OPEC spare capacity, and we are now heading into the driving season in the Northern Hemisphere, which will witness an increase in demand for motor fuels. Refiners’ demand for crude oil is also rising, as plants typically come out of seasonal maintenance and begin ramping up runs to meet peak demand. This action is not about price but rather about ensuring an adequately supplied market to protect the world economy from unnecessary damage when it is in a fragile state.

Ronaldo "The fenomenom" hangs up the boots

Brazilian star Ronaldo has announced he is retiring from football at the age of 34.

He is one of only two players – the other being Zinedine Zidane – to be named FIFA world player of the year three times. In a glittering goal-filled career, Ronaldo Luís Nazário de Lima was a member of two World Cup-winning sides in 1994 and 2002.

He told a packed press conference in Sao Paulo that injuries had forced him to put an end to his career.

“I came here to say today that I’m ending my career as a professional player…Four years ago at Milan I discovered I was suffering from a complaint called hypothyroidism, which slows down your metabolism and to control it I would have to take some hormones that are not permitted in football because of anti-doping.”

He added that “it has been a beautiful, emotional, marvellous career.”

He had been expected to retire at the end of this season but with his club, Corinthians, making an early exit from the Copa Libertadores, he decided that now was the time to call it a day.

Ronaldo’s glittering career began at Cruzeiro in his native Brazil where a dazzling goalscoring streak brought the teenager to the attention of some of Europe’s biggest clubs.

Later that season, he was named as non-playing member of his country’s 1994 World Cup squad.

Ronaldo joined PSV Eindhoven after the competition. In two seasons in Dutch football, he hit 54 goals in just 57 games.

That rich vein of form alerted Spanish giants Barcelona, who were coached by Englishman Bobby Robson at the time.

Robson only coached Ronaldo for one season but he once referred to him as “the best player I have ever worked with.”

Robson said: “Ronaldo was lean, mean, as quick as an Olympic sprinter and some of the goals he scored had me shaking my head in disbelief.”

Ronaldo stayed just one season at the Camp Nou where he netted 47 goals in 49 matches – a return which saw him named the youngest ever winner of the FIFA World Player of The Year at the age of just 20.

After one season with Barca, Inter Milan snapped him up for a world record fee and Ronaldo went on to score 59 goals in 99 appearances for the Italian giants.

But it was with the Nerazzuri that injuries began to hamper Ronaldo’s career. He damaged his knee in 1999 and then again during his comeback in February 2000, which kept him out of the game for another two years.

Nevertheless, Real Madrid were willing to part with 39 million euros in 2002 to secure Ronaldo’s signature. He paid them back with 98 goals in 164 games and a record number of replica shirts sold with his name. Four seasons later, he was back at the San Siro, this time with AC Milan. He played just 20 matches there, scoring nine goals, before moving back to Brazil to play with Corinthians.

He also made a huge impact on the international stage and holds the record for the number of goals scored in World Cups, with 15.

In 97 international matches, he scored 62 times for Brazil

Mubarak shuffles cabinet but protesters say "Go!"

Egyptian President Hosni Mubarak overhauled his government on Monday to try to defuse a popular uprising against his 30-year rule but angry protesters rejected the changes and said he must surrender power.

On the seventh consecutive day of unrest in the Arab world's most populous nation, tens of thousands of protesters rallied in Cairo's Tahrir Square chanting "Get out ... We want you out" and singing Egypt's national anthem.

Troops backed by tanks made no effort to disperse the crowd.

"This is all nonsense," said protester Omar el-Demerdash, 24, a research executive, adding:

"The demand is clear: We want Mubarak and his men to get out. Anything other than that is just not enough."

Egypt's powerful army now appears to hold the key to Mubarak's fate. Although the generals have held back from crushing the revolt, they have not withdrawn support for him.

The uprising, unprecedented in scale and intensity in this once tightly-controlled country, erupted last week when frustration over repression, corruption, poverty and the lack of democracy under Mubarak boiled over.

About 140 people were killed in clashes with security forces in scenes that overturned Egypt's standing as a stable country, promising emerging market and attractive tourist destination.

Mozambican culture baobab died aged 75

Maputo, 05th Jan(GMN) - From politics to the arts, there were many expressions of regret at the disappearance of Malangatana Valente Nguenha painter, died today at the Hospital Pedro Hispano, Matosinhos, Portugal.

Many comment on the disappearance of Mozambican painter

"I was very shocked by this tragic news, " said Joaquim Chissano, former president of Mozambique.

"I do not understand how Malangatana who looked like a healthy person and traveled with a huge capacity, dies so suddenly, "confesses the architect Pancho Guedes.

 

"He understood that the cultures were mulatto. It's a huge void his death, but leaves a great legacy, "said Mia Couto.

"It's a great loss. To the world. Malangatana won this dimension. Beyond the borders of Mozambique and Africa. This loss is irreparable, "said Domingos Simões Pereira, executive secretary of the Community of Portuguese Language Countries (CPLP).

"The work has a very strong identity. When we look at a piece of Malangatana immediately say it's Malangatana. Has authored a very strong, " said Isabel Carlos, director of the Centre of Modern Art, Gulbenkian.

"What can one speak about a culture baobab and one of the most representative painter of Africa? The African culture is bereft. I do not know what we will become without Malangatana, "said the Mozambican painter Naguib.

Born June 6, 1936, District of Marracuene Malangata was one of the most famous Mozambican artists worldwide, having been in 1997, named "Artist of Peace" by UNESCO.