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CORPORATE SOCIAL INVESTMENT: Most coal miners not yet meeting social obligations in the country

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Only one of the multinational coal miners operating in the Moatize district of Mozambique’s Tete province has so far honoured its obligations to use part of its income to fund local community development. The companies concerned are India’s Jindal Steel & Power, Minas de Moatize (owned by Anglo-Australian company Beacon Hill), Rio Tinto (also an Anglo-Australian enterprise) and Vale, of Brazil. The one that has been fulfilling its duties is Vale.

The four groups should, according to Tete provincial finance and planning director Maria de Lurdes Fonseca, have released a total of 22.2- million meticais, but the local communities have so far received only 7.2-million meticais. These payments, she pointed out to Mozambique media at a press conference, were not voluntary but required by Law 15/2007, amended as Law 1/2013.

“What we have as income to empower the families or communities is taken from the taxes on the surface [sic] and production of the mining companies,” she said. “We have encountered constraints, because the companies are not fully delivering their production taxes, just deducting their coal transport costs. Therefore, we feel that we need to work harder to convince the companies to pay their total taxes.”

In consequence, programmes to benefit communities have fizzled out as the funds have had to be diverted. The original plan was that, of the monies received from the miners, “30% of the total would be allocated for infrastructure and the remaining 70% to benefit the communities”, reported Fonseca, “but all the money came to be allocated to the communities”.

Separately and coincidentally, at the end of last month, senior executives from the Vale group attended the first corporate social responsibility (CSR) workshop to be held in Mozambique. They were executive director: Fertilisers and Coal Roger Downey and executive director: Human Resources Vania Somavilla. According to the mining group, the participants at the event shared best practices, considered the issues of cooperation and sustainability and closely examined Vale’s CSR programmes in the Cateme and 25 de Setembro communities.

Some 100 people attended the workshop, which was aimed at strengthening Vale’s CSR-related partnerships in the country. Participants included leading local cultural figures, not least world-renowned Mozambican novelist Mia Couto (full name António Emílio Leite Couto). “Can you have development which is not sustainable?” he asked in his presentation. “If it is not sustainable, it should not be considered development.”

The miner’s CSR projects in Moatize are developed jointly with different companies and institutions. These projects are aimed at job creation, income generation and education and training.

In another meeting, in Maputo, at the beginning of this month, Vale Moçambique hosted local goods and services supply companies and related government agencies in an initiative to increase the Brazilian miner’s local purchases. The participants discussed possible synergies and exchanged experiences. The development of local suppliers, local purchasing of goods and services and the development and employment of local labour are among the obligations Vale has accepted.

Vale Moçambique supply manager André Gustavo expressed satisfaction with the outcomes of the meeting. He pointed out that sourcing goods and services from Mozambique companies increased the local content in the miner’s Moatize operation. Mozambique Investment Promotion Centre representative António Macamo viewed the results of the meeting as excellent, as they brought together different local companies involved in Vale’s supply chain. He affirmed that it was necessary for major companies like Vale, other companies, government institutions and the centre to work together to achieve the results desired by all the parties.

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