Gold Discovered in Kenya: British Firm Now Very Rich

AllAfrica.com have an article about a British company that has just discovered gold in the South West of Kenya. Sadly, the article makes it sound as if discovering gold is good news. It is good news for the companies involved and the article tries to make it sound as if it will also be good news for people living in the area and people already involved in artisanal mining.

Does anyone seriously believe that any African country is better off for discovering gold? I don't think the artisanal miners will be jumping for joy either, despite the gold firm's claims to have forged 'excellent relationships' with local people. There's always a lot of similar bullshit when foreign companies know they are on to a good thing here.

Kenya should take a look at the experience of Tanzania. In fact, this mining area is probably contiguous with some of Tanzania's mines, given the suspiciously straight South border between the two countries. Tanzanians receive little or nothing from their substantial gold reserves. Most of the profits go to foreigners, especially Canadian ones. The Tanzanian government seems to be very favourable when it comes to foreign mining operations, giving them tax breaks and leaving employment laws lax enough to give the gold firms carte blanch to treat people like slaves.

Kenya could ask the artisanal miners there if they have 'excellent relationships' with gold firms, that's if they can still find artisanal miners in the gold industry. Or they could read an article called "Golden Opportunity: Justice and Respect in Mining". Before Kenyans allow themselves to be walked over and taken advantage of yet again, allow even more of their environment to be destroyed, allow more of their people to be exploited in a savage and corrupt industry, allow themselves to be duped out of even more revenue, allow a handful of people to become extremely rich at the expense of the majority, they really should read the article. Sphere: Related Content

The Great Tanzanian Gold Robbery

Finding gold or any other natural resource must be a mixed blessing. But when an American company finds 'vast' deposits of gold in Tanzania, the blessing should be completely unmixed. The American company will take as much as it can and pay as little in royalties, taxes, wages and any other costs.

For Tanzanians, on the other hand, it will be an unmixed curse. Another invasive multinational destroying the environment, creating a few badly paid and insecure jobs and putting enormous numbers of artisinal miners out of a job. They have seen it all before and will probably see it frequently until foreigners have stripped African countries of everything they can possibly use and destroyed even the things they can't use.

People who imagine that developed countries 'give' large amounts of aid money to developing countries should be aware that even larger amounts of wealth are extracted by multinationals that don't pay much in the country they do the extracting nor in the country where they are based.

It seems extraordinary that in a country of around forty million people, around half live below the poverty line, unable to get enough food or clean water to ensure their health and the health of their families. They need the most basic things for their very survival.

At the same time, rich, foreign 'investors' take virtually all the wealth Tanzania has in order to fulfil their need for gold, uranium, precious stones and things that are not in any sense important for survival. They will use much of the country's water and contaminate the water table and the surrounding lands.

I met an Australian who worked in the mineral exploitation industry in Tanzania and he denied that people were exploited or badly paid. However, he also claimed that most highly skilled workers in the industry were not Tanzanian because, according to him, there were not enough trained people in the country. Yet, he didn't seem to see the connection between extracting most of the country's wealth and that country being unable to pay for adequate education for its citizens.

Apparently, the Tanzanian government is putting together a bill so that the state has a 10-15% stake in future mining operations. It's about time, but why don't they enable Tanzanians to do the mining? At present, there are all sorts of incentives for foreigners to come into the country and take what they can get but indigenous mining operations in Tanzania do not receive the same incentives.

Tanzania's minister for Energy and Minerals boasts about the climate for investors in Tanzania. How about the climate for Tanzanians? Most of them are still poor and many are worse off as a result of the mining operations that have been taking place in the country. The amount of money being spent on education, health, infrastructure and other basic needs is a pittance compared to the wealth leaving the country and going into the pockets of very rich people.

Tanzanians are being robbed, with the connivance of Tanzanian politicians. Sphere: Related Content

Uranium for the Rich, Contaminated Land for the Poor

Photo: Sun setting over Lake Tanganyika, Kigoma, Western Tanzania

The announcement that Tanzania has substantial deposits of uranium may or may not be good news. The country already exports a lot of gold but receives little benefit from this. There are so many subsidies and benefits for foreign miners operating there and so little capacity for enforcing proper overview of what is being extracted and exported that the only people who benefit are the big mining operators themselves. Employment in mining has dropped to a fraction of previous levels, so the industry probably represents a net loss to the country.

Why should uranium mining be any different? Large scale mining will employ very few people, will be capital intensive, will cause a lot of environmental damage, the usual story. There is a lot of talk about new laws but it is more likely that the mining operators will be allowed to come in, take what they want, do as much damage as the always do and leave the mess for Tanzanians to clean up or put up with. All the good resolutions being made now about proper regulation mean nothing when countries like Tanzania have virtually no regulatory power because of ubiquitous excuses such as the need for 'deregulation' and 'free markets'.

Countries like Tanzania need regulation and they need to be able to enforce regulation to protect people from the sort of exploitation that they have suffered since the beginning of Western invasions of the African continent. If the market is to be free, Tanzanian mining operators, ones owned by Tanzanians, not just with a few Tanzanian board members, need to be able to avail of the benefits that foreign miners receive. And the country needs to be able to audit operations to the extent that they get their fair share of royalties and other levies. So far, large scale extractive industries have only benefitted rich people and big companies while the majority of poor people lose out and end up worse off than they were previously. Sphere: Related Content

Penetrative Theft

Photo: A view of Mwanza, North Western Tanzania.


Tanzania is the third largest producer of gold in Africa. Does this mean that the country receives lots of revenue from this massive industry and that hundreds of thousands of people are employed extracting gold? No, most people are poor and only a few thousand people are employed in the industry now.

In fact, the government gives so many tax breaks and other benefits to foreign miners that even politicians, who usually make lots of money even when their electorate remain poor, don't make that much from gold. Well, I'm sure they do ok, but for some strange reason, they seem happy to watch the country's gold being raided by these foreign operators.

In addition to demanding low royalties from foreign companies, the country is losing out because gold had traditionally been labour intensive. Now, with high technology extractive processes, employment is minimal, most of the big earners are not Tanzanian and the majority of workers are paid very low wages. Several hundred thousand former artisan miners are unemployed as a result of these foreign companies taking over.

Much of the Tanzanian government's thinking on the industry seems to have been shaped by the bizarre strictures of the International Monetary Fund and the World Bank, who insist on low taxes, low royalties, incentives for foreign 'investment' and various de facto subsidies that are not available to any Tanzanians who might otherwise be able to get into the industry. As a result, Tanzanians haven’t a hope of being to compete, competition only being a good thing when the odds are stacked against them, it seems.

The biggest operators in Tanzania, Canadian Barrick Gold and South African AngloGold Ashanti, appear to be making huge amounts of money by these various deceits. But those who can do anything about this don't seem interested in intervening. The above international financial institutions don’t actually see any problem in such iniquities. The Canadian and South African governments could intervene, though they may not see this as being in their interest. But I don't understand why the Tanzanian government has for so long failed to right this terrible injustice.

In addition to this assault on the Tanzanian economy and the welfare of Tanzanians, the international financial institutions, multinational extractive operators and others involved don't seem to have any respect for democracy or human rights. In the long term, extractive industries cause immense environmental damage, the consequences of which will be borne by Tanzanians.

National and international laws need to protect people and prevent multinationals from destroying whole communities and defrauding sovereign countries. They should also prevent irreversible destruction of environments, which will probably affect future generations more than present generations. Rich country governments who are profiting from these industries, along with the powerful but unelected and unaccountable members of international financial institutions, also have a duty to see that these laws are properly policed.

Sadly, Tanzania is not the only country in Africa where this sort of exploitation is taking place. In fact, most African countries with natural resources that are highly valued by the West are being similarly plundered: Ghana, Democratic Republic of Congo, Nigeria, the list goes on. But Tanzania is one of the few where Western governments didn't have to oversee a war in order to take what they wanted. For some reason, the Tanzanian government is far more compliant that some other African administrations. Sphere: Related Content