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sharing in governance of extractive industries

CORPORATE SOCIAL RESPONSIBILITY: WHO SHOULD DO IT ? LEARNING FROM GHANA

By Coletta Wanjohi

The discovery of oil in Uganda has raised concerns among many communities all over the country as to how they will benefit. In Ghana, where oil production has just begun, there is confusion over whose job it is to help the locals achieve a better standard of living. It has become a blame game with the companies feeling that they do enough, the communities expecting more and the government failing to draw a line between what its obligations and those of the companies are. For some Corporate Social Responsibility, as it is called, is a little more than a token gesture.

Observing the gold mine workers, one by one they come out of the pit covered in dark mud, a clear indication of what they have to go through as they dig and pack soil in small sacks. To aid their visibility in the dark pits, they carry small domestic torches tied at the side of their heads. The expression on their young faces is that of fatigue and relief that at least they have come out alive with bags of ore which hopefully, will contain gold. These are just part of the thousands of small scale miners in Prestea, found in the western part of Ghana. They are commonly referred to as the Galamseys, which means gather them and sell, exactly what they do when they mine gold.

The galamseys are local illegal artisanal miners but the Ghana Chamber of mines confirms that they contribute 12% of the total revenue from gold. Their operation is not governed by any formalities as is the case with the other big mining company, in the area, Gold star

According to WACAM , the representative body of communities affected by mining , galamseys operation thrives on the fact that Gold star whose annual production is about 350 ounces of gold is viewed as being negligent of the community's needs.

“Our people feel that it is better to help themselves since these mining companies that forced us out of our land don't want to do build for us schools, hospitals and other good facilities,” says Mohammed, an official of WACAM.

Despite the fact that their activities have contributed to destruction of the environment and endangering the safety of water in their rivers, the galamseys feel that they are better off fending for themselves instead of waiting for the multinational gold mining companies to provide basic amenities and employment. “They say they are using American type of blasting,” says Dominique Myame, the secretary general of COCAP (a representative body of communities dealing in illegal mining, “but the lifestyle they are putting us through is not American.”

Driving around Prestea, the area where gold has been mined for over a century in Ghana, one cannot help but notice that there is little evidence to show updated education structures, health, and clean water facilities. The roads are bad. Their houses are in poor condition and the electricity poles stretch mainly along the mining paths of established gold mining companies.

IN GHANA'S “OIL CITY ”

The status of these mining communities is synonymous with that along the coast in Takoradi where Ghana's off shore oil exploration is going on. The residents of this area who are predominantly fishermen, cannot yet point to any project that has made a change in their lives ever since the jubilee partners became their neighbors. They only have a hall where they watch football matches at a fee .It was built by the Volta River Authority, an electricity generating company.The 70 year old chief fisherman of this area says, “ These oil people have visited us twice ever since they set their operations here. They do not come to the shores to interact with us.”

Communities around the operating areas of the foreign companies have high expectation of better living standards because of the expected revenue associated with such natural resources. However, what some do not understand is why they have not directly received some of the money yet they are the people who are closer to the action.

Anthony Cudjoe the Chief executive of Shama -Ahanta Metropolitan Assembly (who is equivalent to the mayor of Takoradi, the source of Ghana's oil) laments. “We in Takoradi have never received even a cent of the money that comes from oil, I was told that if you demand they will give the projects that we want so am going to demand.”

In defense some multinational companies argue that corporate social responsibility is done in consultation with the relevant communities, but civil society organizations believe that these investors have selfish interests. Tullow Ghana that is the main player in the Jubilee oil fields in Ghana has argued that projects for the community are done according to the company's outlined plans. "We have chosen four areas where we can help the government because CSR is an operational cost,"says Gayheart Mensah the Public relations officer of Tullow Ghana.

“However, when production starts and you start making profits the entire regime changes,” he added.

Should CSR be free?

The idea of including costs on corporate social responsibility on the cost of operation has been criticized by civil society organizations. In Ghana Mohammed Amin a member of the civil society in Ghana asserts that “CSR is not free and a commission should be set up to look into CSR plans before they are done.”

With Uganda having discovered oil in the Albertine region and Tullow being the major player in the exploration, speculation of how best the community around the exploration area will benefit from Tullowrsquo;s presence cannot be avoided. The company has been criticized by some Ghanaians for failing to even buy vegetables from the local community.

In Uganda Tullow the man player in Uganda's oil exploration, has already been criticized for failing to buy meat locally from the Buliisa community and instead importing most of what the workers at the rigs use. In defense, Tullow Uganda has argued that it does not want to contribute to increasing inflation in the areas they operate in. Tullow Uganda further argues that if it were to buy all that is produced in the Buliisa area then the locals would not have what to consume and they would end up paying highly to buy what they themselves produce.

The ministry of energy has also defended the activities of Tullow Uganda as far as corporate social responsibility is concerned, Dr. Bukenya Matovu a communications officer at the ministry recently told journalist at the African Centre for media excellence in Kampala that as far as the government is concerned corporate social responsibility is not a cost to petroleum in Uganda .He said unless the Attorney General changes that, then those cost will not be levied on the tax payer.

Who should do it?

In the case of Ghana whose proven reserves of sweet and light oil is 800 million barrels and is now at production stage, civil society organizations are crying foul that African governments have failed to take time before signing major contracts.

“We have greedy governments in Africa that don't think of the concerns of the people.” says Kwame Jantuah of African Energy Consortium Ltd.

Mohammed Amin a member of the Ghana civil society argues that,“Government should differentiate between its duties and those of such companies why not just collect taxes from them and give the people what they deserve?”

The ministry of energy in Uganda has defended the government as being fully aware of what to do for the people despite the presence of multinationals like Tullow Uganda.

Kwame Jantua Suggests that governments empower their citizens to take up jobs in such mega projects, approving contracts that favor the nationals more and as the Takoradi Mayor put it , giving a percentage of the revenue to the communities where natural resources are exploited.

As the debate on who should do what for the community takes different levels in different countries ,there are always those members of the community like the illegal artisanal miners in Ghana who seem to have lost interest in it. People like them believe that it is only them who can make their own lives better. They take whatever risks they have to in order to enjoy what they and others in Ghana says neither the government nor companies can provide.

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Comment by Coletta Nyawira Wanjohi on March 20, 2012 at 9:04

Hi Evelyn Parra

 Thanks for your comment. I think the problem that blankets the need for development in areas that have natural resources is politics. For instance if you look at the Ugandan case oil has been taken as apolitical asset rather than something that is expected to change lives for the better. If only our leaders would guide us towards feasible development then engage in constructive politics then we shall be seen to be heading somewhere.

Comment by Evelyn Parra on March 18, 2012 at 14:07

Many thanks Coletta for sharing this information.

Civil society has learned to understand in a quite painful way what are political/governmental and industry interests towards extractive industries and as a result they hardly trust in promises of future improvements in employment, education and health systems.

In my view, it might be worthwhile to reflect on if it is best to differ the effective exploitation of natural resources until a coherent mechanism of implementation of local content development is achieved (with the active participation of the communities) guaranteeing in few years a real welfare upgrade.  

Best wishes, Evelyn

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