Soon after the fall of the Berlin wall, we descended on Wismut, East Germany with proposals to help them cleanup the old uranium mines, mills, and tailings impoundments that the Russians left behind. The large American consulting firm that I was working for at the time, believed that with our UMTRA Project experience, we were well-suited for the work. So too did a small Canadian consulting company.
The small Canadian company got the work. Maybe they were more technically proficcient–but I doubt it. The real reasons they won, at least by our American company analysis, was that the Canadians came with a CIDA grant and that made them much cheaper than we could be.
The Canadian consultants did some work, made some good freinds, taught the East Germans a bit, and then withdrew—for the East Germans were well-educated, well-organized, and soon realized they could do the work themselves. We all remained friends and when I got back together with the folk of the small Canadian company, we drew on the engineering advances made at Wismut to formulate a way to reclaim an oil sands tailings impoundment.
That is, to my mind, a good use of CIDA funding. The CIDA funding helped a small Canadian group beat out a large American group, new technology was developed, and Canada was the ultimate beneficiary.
So it is with mixed emotions that I read in today’s Globe and Mail that CIDA is funding large international mining companies in remote places. Companies getting CIDA grants include: Barrick Gold, IAMGOLD, and Rio TInto. Countries where there are CIDA-supported projects include: Peru, Ghana, Mali, Senegal, and Mongolia.
There are critics of CIDA suport for big mining companies. This from the Globe and Mail report:
The practice is fuelling the ire of some NGOs and critics of the mining industry, which lambaste the government for subsidizing the so-called “corporate social responsibility” projects that are put in place by profitable companies. Jamie Kneen of MiningWatch Canada said the government is helping the mining industry to put a positive spin on their operations, despite their negative environmental and human-rights records.
Supporters claim just the opposite. Again from the Globe and Mail report:
But World Vision Canada, which is working with Barrick Gold and CIDA in Peru on a $1-million project, is defending its actions as having a positive impact on children and families. “We have to be realistic here, there is self-interest on the part of every party here,” said World Vision Canada president Dave Toycen. “Anything we can do to encourage and advocate for better mining practices, and support the communities that they are displacing or affecting, we’re contributing to a better lifestyle and environment for them.”
In a statement issued by her office on Thursday, Ms. Oda said her government wants to encourage Canadian firms to help “local populations,” arguing that extractive industries – referring to mining and oil and gas – are creating jobs and economic development. “This approach of partnership will result in enriching the local communities, building a stronger skilled workforce and reducing poverty for many families,” she said. “Creating sustainable economic growth in developing countries is key to reducing poverty.”
It is difficult to work out from the reports if the CIDA money is going to the mining companies or to smaller groups, such as World Vision Canada, who seek to do good things around mines to promote that old cliche of sustainable development.
I am torn between two hats. As a taxpayer I find it bad that tax money should go to support big mining companies. As an investor, I am off to buy share in those mining companies, for if they can wrest money out of the taxpayer, so much the better for me as an investor. My third hat, that of a moral being, supports the spread of Canadian ideals by way of teaching those locals how to respond to mining—why they may develop cities as viable as Vancouver with its vigerous sustainable mining industry.
Another long report is from the Ottawa Citizen. They shed this light on the CIDA-funded, mining-associated projects:
The projects include one run by Plan Canada in partnership with IAMGOLD to provide training in Burkina Faso and another by the World University Service of Canada to provide training in Ghana, in partnership with Rio Tinto Alcan. CIDA has set aside nearly half a million dollars for a third project – in which World Vision Canada will work with Barrick Gold in Peru to “increase the income and standard of living of 1,000 families affected by mining operations.” Barrick Gold says it also contributed $500,000 to the project.
The Ottawa Citizen nicely captures my three-hat problem in this paragraph:
In a time of shrinking foreign aid dollars, taxpayers should not be on the hook for corporate social responsibility projects. The programs might be welcome and worthwhile, but they should be paid for by the companies that are reaping the profits and getting much of the credit. CIDA’s involvement in the partnerships potentially tars all Canadians, by default, for any bad corporate behaviour, or environmental damage, that results from those mining operations.
The news outlets which I quote above are gentle in their reporting. Not so the bloggers. Here is one that pans CIDA, saying:
World Vision Canada, a CIDA partner with Barrick Gold in Peru, put it this way (italics mine): “Anything we can do to encourage and advocate for better mining practices, and support the communities that they are displacing or affecting, we’re contributing to a better lifestyle and environment for them.” Yes, sadly, communities will be displaced but at least our taxes will be there to help polish the image of their new corporate landlords .
And:
It’s particularly galling that multinational mining giant Rio Tinto ($US15 billion-plus earnings in 2011) is receiving Canadian corporate welfare after locking 800 Canadian workers out on New Years Day in Quebec for protesting having their union jobs replaced by contract workers. Additionally, a court injunction only permits 20 workers to demonstrate at any one time and only at a distance of 150 metres from the front gate.
On the other side of the fence, Natalie Bender of the Canadian International Policy Studies supports the CIDA grants. She writes in their defence:
It is certainly not news that many government programs, from education to health care to infrastructure, effectively help corporations continue their operations and reap profits within Canada. There are arguments to be made about the justice of this situation—but those arguments about capitalism and its iniquities aren’t at issue here. The mere fact of publicly-financed support for corporate profit-making, therefore, doesn’t constitute a prima facie reason to denounce CIDA funding for CSR projects associated with Canadian profitmaking abroad.
Then she goes off track. As she writes below, it seems she believes that Canadian mining companies cannot do it right, therefore CIDA-funded NGOS should do it, as the presumably can, correctly. I am not sure of the logic of her reasoning, but she does write with verve.
But as for the notion that damage-mitigating projects should be paid for solely by mining companies themselves, it’s implausible to think that those companies could design and implement such programs. That’s what NGO expertise is for. CIDA funding makes it possible for Canadian NGOs to put that expertise to use, and for both NGOs and corporations to be held accountable for living up to basic standards in doing so.
The news will continue, bland as always. Blogger will continue, contentious as always. CIDA will continue, dysfunctional as it is said to be. Mining will continue, with or without Canadian taxpayer money. NGOs will continue—and the more of them that can be folded into the mining camp, happy with CIDA money the better. Let me know what you think.
PS. Since posting the above, I have had to explain my thoughts to some young engineers in the office who are incensed by all these goings-on. Here is what I said.
I am sure the mining companies involved can and should do what CIDA is paying for. The mining companies are possible doing this already. They are probably continually being pestered by small companies, small consulting companies, to give them some work doing the sustainable development and community outreach work that CIDA (and you the taxpayer) are now paying for. The mining companies, at first, probably told the small consultants to go away—for what mining company would not prefer to do it under their own control and management?
But, I bet the small consulting companies saw an opportunity with Bev Oda of CIDA. And they appealed to her to give them some money to help the big mining companies. The opportunity for a conservative to play liberal was irresistable.
So now we have this amazing situation: the taxpayer is paying to keep small Canadian companies busy helping big companies do what they would probably prefer to do themselves. But why throw away free government money?
You could argue this is not all bad: the CIDA money stays in Canada to pay the consultants; the small get get a chance & experience; Canada looks good–or at least that it the hope; and the mining companies get a bit of free, albeit uncontrolled, help.
This is as good a way as any of the government pumping money into the economy. Maybe it is good to simply keep the money flowing & circulating within the country. Better than bridges to nowhere.
And it gives us all a chance to post another dreary picture of an African in a dire situation.
Sorry if I offend in this debate. That is a blogger’s right & duty. You can always blog yourself, write to your politician, or comment below.
Would it not make more sense to provide funding to smaller, less profitable (if profitable at all) mining companies that may not have the resources/capacity to carry out CSR programs? Why provide funding to companies will millions (maybe billions) in profits?