Damning report released on iron ore giant China Union

Wednesday, May 21, 2014


May 21, 2014

(Monrovia, Liberia) – The Sustainable Development Institute (SDI) today released a report on the relationship between China Union, a major investor in the iron ore sector in Liberia, and the community that lives in the vicinity of its mine. The report highlights China Union’s slowness in living up to provisions of its agreement with the Government of Liberia, pointing to widespread dissatisfaction in Fuamah District, Bong County with the company’s operations and its abusive treatment of Liberian workers. SDI called on the Government of Liberia to press China Union to ensure that it fully complies with the terms of its Mineral Development Agreement with Liberia and that allegations of violence against Liberian workers are addressed and violators are punished.

SDI staff members conducted repeated research missions into Fuamah District, Bong County, the site of China Union’s mining operations in Liberia. The company holds a 25-year Mineral Development Agreement (MDA) with the Government of Liberia to mine iron ore, taking over a site that was once operated by a European investor. SDI researchers found credible evidence that China Union has an extremely poor relationship with the Fuamah District community, where it is accused of mistreating workers, promising employment as an incentive for individuals to resettle and then not providing them with jobs, and standing by idly while its social contribution is carved up by local politicians vying for re-election in October 2014. Tensions overflowed in October 2013, when demonstrations in the area provoked deployment by members of the Emergency Response Unit (ERU), a paramilitary detachment of Liberia’s security apparatus, who fired in the air to disburse protestors.

“China Union has a ways to go in repairing its relationship with the Fuamah District community,” said Ashoka Mukpo, the report’s author. “To begin, it must recognize the legitimate grievances that led to the demonstrations in 2013, and implement a zero-tolerance approach to worker abuse.”

The 23-page report, released today by SDI, provides background information on the MDA and analyzes the most commonly cited grievances that were raised by interviewees near China Union’s mine. Among its recommendations are that the Government of Liberia ensure that China Union’s USD$3.5 Million per year ‘social contribution’ results in at least USD$350,000 of expenditures per year in Fuamah District. At present, nearly no projects have been completed despite years of contributions by China Union, and there is cause to believe the fund is being mismanaged.

“These Social Development Funds were created to offset the impacts of mining operations and bring benefits to communities,” said Silas Siakor, campaigner at SDI. “So far we’ve seen nothing but poor management and political manipulation of the funds across Liberia.”

For More Information, Contact:

Ashoka Mukpo, Researcher, at 231 (0) 888 048710 or ashoka[at]sdiliberia.org;

Silas Siakor, Campaigner, at 231 (0) 880 655712 or ssiakor[at]sdiliberia.org.

The report can be downloaded here.