Chibuto heavy sands project at the centre of land expropriation

By CJI team

The 10.554 hectare land concession to the China-based Dingsheng Mining company for the exploitation of heavy sands in the locality of Canhavano, Chibuto, in the southern Mozambican province of Gaza, was hailed as a game changer and an economic boon for the local population, country and foreign investors.

The project, to be run by Dingsheng Mining and its partners Foreign Economic Construction Group (AFECC) and the Mozambican Mining Company (EMEM), was unveiled in April 2018, in the presence of President Filipe Nyusi. Geological projections indicated that the lands held around 108 million tonnes of ilmenite, the most important ore of titanium.

The one billion US dollar investment will enable the company to exploit the ore for between 70 and 100 years.

But the project has not been without controversy. Moments after Nyusi had left, a group of people in the Mudumeia village, in the Chibuto district, mutinied and blocked the access road to the heavy sands project.

From President Nyusi’s encouragement

Certainly Nyusi made the Chinese welcome in Chibuto and encouraged Dingsheng Mining to work in a coordinated fashion with the local communities, as well as the district administration. He expressed his satisfaction with the facilities that the company was building to guarantee that the mineral be transported with efficiency, which include a new 70 km railway from Chibuto to Chokwe. The loads of ore will be shipped from Chokwe to Maputo through the Limpopo line from Zimbabwe to Maputo. The company is planning to build a dedicated terminal at Maputo port to handle the ilmenite. On the drawing board, there is an airport in Chibuto and a new power station connecting it to the ilmenite mine is Chibuto.

“We’re urging the greatest collaboration with the communities, since they are part of this undertaking,” said Nyusi. “It is necessary to take care of the communities and the workers, and the government is ready to give support in all that may be necessary. The gains are enormous. We have to cherish this project to the benefit of both countries (Mozambique and China) and the communities.”

The project envisages the resettlement of about 1,500 families from the concession area. Also in the works and as part of the social projects, Dingsheng Mining is building a water treatment station, which will be able to treat 10,000 cubic metres of water daily, expected to be completed by the end of June 2021. The project will also include a hotel, a supermarket, and a factory producing zinc sheets for roofing.

The entire investment is estimated at a billion US dollars, and the known reserves will allow the mine to operate for between 70 and 100 years, and is likely to give jobs to 3,000 Mozambican workers.

A test factory is already operating, and is able to process 1,000 tonnes of ore a day. The tests should have been due by the end of June 2019.

Complaints

But the resettlement process has not been without its thorns. The people who are to be resettled have been complaining that the land concessions for the exploitation of the mineral ore have eaten into their agricultural land, and that the compensation process was not fair.

Maria Cossa, aged 59, a native of Chibuto, argues that she was not fairly compensated. “We’re being cheated. The mining company says that it paid people two million meticais (about $27.2 thousand at the current rates of exchange) worth of compensation when, in all honesty, we received less than that.”

Thousands of people were dispossessed of their ancestral land, which was their main source of livelihood. This means they can no long use the land to practice agriculture, and obtain money to put their children through school, among other things.

The people decided to block the entrance to the project, but were dispersed violently by police. “We were shot at. We’ve submitted documents to various government authorities to denounce the situation with no success. When we go to our agricultural lands, we’re shot at. We have hospital documents that attest to that,” said Filipe Muhlanga, adding that if the “Chinese do not have money, they should stop their machinery and remove the fencing to let us till the soil. We don’t want the money anymore for we have seen they don’t have money to pay us.”

CJI contacted the company management which declined to comment. However, the Chibuto administrator, Brígida Mathavele, did tell CJI that she is aware of the conflict between the communities and the mining company, and as such, the administration is in the process of mediating the case in order to find a better solution.

This is déjà vu. In almost all resettlement cases gone bad government has sided with investors, who are likely to be backed by political elites. This is more likely to lead to populations being uprooted from their often only source of livelihood, resulting in more and more Mozambicans becoming impoverished with a huge human cost. “Our lives are worth nothing,” said Muhlanga.

The Chibuto Director for Infrastructure Services, Pascoal Gemo, said that the situation has dragged on owing to the COVID-19 pandemic, which put paid to efforts to resettle all the families affected by the investment.

After the identification of the resettlement area in the Nwahamuza neighbourhood, in the Locality of Mangume at the Administrative Post of Malehice, which borders the concession area, the compensation process commenced and subsequently the building of the houses. But only 498 houses have been built so far, including a water supply system, police station, health centre, and school, among others.

But strangely in 2018, after the completion of the 498 houses and other social infrastructure, the company decided to renegotiate the agreed compensation amount for the fruit-bearing trees – compensation is calculated taking into consideration the improvements on the land and for each fruit tree.

So in December 2018, a group consisting of those affected by the renegotiated deal thought it fell short of their expectations, and forced the company to reinstate the initial Resettlement Action Plan. This seesaw in negotiations led to a 10-month delay, after which 269 families were resettled, but this process was interrupted in 2019 right at the onset of the coronavirus pandemic. The hope is that by March 2021 the company can resume compensation payments.

Gemo denied that the company hired a protection company, even though the police was called twice to control the crowd of demonstrators who were vandalising property. The first time the group was demanding to know why the signing of the agreement was taking so long, and the second time the other group was pressing for the restitution of the initially agreed compensations.

“In none of the occasions were the police violent; they only calmed down the protestors,” he said. This led to the establishment of a new committee which included government, the resettlement committee and the company, which resulted in an agreement to reconsider the initial compensation plan.

Dingsheng Mining has a history of controversy. In 2016, workers hired by the company to build a road linking the central provinces of Manica and Sofala went on a strike complaining about work conditions. In 2013, the same company was dragged into court in Zambia allegedly for bribing then President Rupiah Banda during the 2011 electoral campaigning.

A community in Nagonha, a locality in the coastal district of Angoche, in the northern province of Nampula, thought they had hit the jackpot when government came with investors, another Chinese mining company, to exploit heavy sands in the region. Between 2011 and 2015, government awarded a land concession to Haiyu Mozambique Mining, a subsidiary of Hainan Haiyu Mining Company, with headquarters in China, to mine titanium and zircon, a mineral which is the source of the metal zirconium.

This meant the resettlement of the local population. The process was not well managed, leading the communities to demonstrate, and government sending the riot police to defend the investment.

To attract foreign direct investment, government policy is to promise fiscal incentives, such as temporary tax exemptions. This has led to lots of foreign mining companies to seek huge land concessions.

Some foreign investors, if not most, seek local partners, starting from the president, ministers, directors, mayors, local party leaders, among others, who, using their influence have almost taken control of huge expanses of agricultural land to further mining operations. As such, tens of thousands of hectares held by subsistence farmers have been expropriated for business related activities like the extractive industry, construction, tourism, among others.

Apart from the unfair compensations awarded to the communities, there is little consideration of environmental impact of such projects, as well as human rights violations when the population stage demonstrations against perceived abuses.

The National Land Policy and the Land Law outline principles which guide land use by the citizens, and the exploitation of mineral resources, and state specifically that mineral resources and hydrocarbonates are the property of the state which determines the terms and conditions safeguarding the national interest. However, when push comes to shove, it is always the common citizen who is short-changed.