EARTHWORKS

World Bank Criticized over Approval of Controversial Gold Mine in Ghana

February 2, 2006

 
EARTHWORKS - FIAN Germany - FIAN Ghana - WACAM

NGOs to maintain pressure on IFC and Newmont to resolve community concerns

On January 31, 2006, the Board of Directors of the International Finance Corporation (IFC), the World Bank's private sector arm, approved loans amounting to USD $125 million for Denver-based Newmont Mining Company's controversial Afaho gold mining project in Ghana. Ghanaian and international human rights and environmental NGOs had previously called on the IFC Board to postpone loan consideration until IFC and Newmont had fully addressed the project's human rights and environmental problems.

These groups have expressed concerns about the the IFC's capacity to hold the company accountable to social and environmental standards. The Board approval came days after an IFC-commissioned monitoring report released in January disclosed that the Ahafo project does not comply with IFC standards on involuntary resettlement. Access to land remains uncertain for a large number of the 9,500 people who have so far been displaced by the project and whose livelihoods are at stake.

"It is irresponsible of the IFC Board to grant a loan without any binding commitment by Newmont to resolve the issues around land and resettlement. Already, affected people are experiencing economic hardship and food security has become a pressing issue," said Ute Hausmann, human rights expert with FoodFirst Information & Action Network (FIAN), Germany.

In recent months, there has been growing international attention to the World Bank's inadequate oversight of extractive industries projects, in particular, those financed by its private sector arm. The non-governmental groups state that they will continue to closely monitor this and other World Bank-funded mining projects and will maintain pressure on IFC and Newmont to meet social and environmental standards. The groups argue that the development benefits of the project hinge upon the restoration of sustainable livelihoods and the protection of clean water for the rural communities affected by the project.

"So far, Newmont has not addressed the community concerns. Instead it has spent resources on research to support its public stance that the community problems are nonexistent. This ostrich behaviour will no longer be viable: Newmont has to provide answers," said Daniel Owusu-Koranteng, executive director of the Wassa Association of Communities Affected by Mining (WACAM), in Ghana.

The project's impact on human health and the environment has been of major concern from the initial stage of the project. Critical tests to fully assess contamination threats such as acid generation have not been completed, nor are the proposed remediation measures adequate, according to an independent technical review.

"Ghana has experienced a spate of mining disasters in the past decade. A full assessment of risks associated with the Ahafo mine and more stringent protective measures are needed to ensure that history does not repeat itself," said Radhika Sarin, international program coordinator at EARTHWORKS, an environmental group that promotes mining reform.

"If there is a time to prevent severe damage to biodiversity, human health and water resources in the area, then the time is now. We will make sure that the people in Ghana and worldwide are aware of what is at stake," said Mike Anane, coordinator of FIAN in Ghana.


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Tagged with: mining, international, gold, ghana

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