Archive for the ‘Natural Resources’ Category

Film Review: Canning Paradise

Posted: May 15, 2013 in Films, Natural Resources
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English: Bluefin tuna.

English: Bluefin tuna. (Photo credit: Wikipedia)

‘Canning Paradise’ is a 90 minute documentary primarily about the commercial tuna fishing industry being established near the town of Madang in Papua New Guinea, but also more generally about the globalised economy rubbing up against traditional ways of life.

Papua New Guinea recognises traditional land ownership in its Constitution, which is fortunate for traditional villagers as they rarely have formally recognised land titles. This provision makes it difficult for the  Government to appropriate land for development. The film also explores the benefit this has had in preventing PNG from becoming a peasant economy.

The village of Madang is a little different because it was formerly a Catholic mission. A court case found that the Catholic Church owned the village’s land and its surroundings, which it on-sold to the Provincial Government in 1991. The Government has decided to open it for development by establishing a so-called Pacific Marine Industrial Zone (PMIZ). This sounds like it is an export processing zone (EPZ) but it isn’t, it’s a title only, no special laws have been passed to exempt companies in the area from normal laws, which is what happens in EPZs.

The Philippino canning company RD Tuna have set up in the area with a number of fishing vessels. Under the deal, the PNG Government receives only 2-8% of the profits in royalties, which amounts to about $50 million. The tuna ends up in one of RD Tuna’s three brands: Diana, Dolly and Dolores.

The PMIZ has numerous issues, for example its rusty vessels do not meet environmental standards which PNG does not have the resources to police effectively.

RD Tuna also mostly employs flown-in Philippino workers rather than locals. Both the company and the Government support the in-house, company-friendly union. When 500 of the Papuan workers went on strike in 2010 over low wages, wage theft and freedom of association, most of them were sooner or later terminated. It seems that the people of Madang are not destined to share in the bounty being extracted right off their shores.

‘Canning Paradise’ is a well made film: not in the sense of being slick, but in the sense of being true to its subject. It conveys the complexity of this issue in depth, resisting the temptation to propose quick solutions. The interviewees were unanimously of the view that a traditional economy has a value even if it can’t be readily expressed in dollars, but beyond that there was no sense at all of a clear way forward. I guess that’s reality: few problems are capable of having straighforward, elegant solutions like you will see proposed in a 4-minute TED talk.

The DVD is available from Ronin Films.

*Postscript: This is the 150th post on fairforall.org. The site recently received it’s 15,000th visit – thanks for your support!

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But South Africa is so far away, right?

Posted: October 30, 2012 in Natural Resources, Rights around the world
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Description unavailable

Description unavailable (Photo credit: freestylee)

Nope.

You know the recent mining dispute in which 34 protesting workers were shot dead after demonstrating for higher wages? You may have heard that they were working in a platinum mine (the world’s largest).

South Africa is the world’s largest producer of platinum. Where does it go? Your car! Just under half of the world’s platinum is used in vehicle emission control technologies. The next biggest use is jewelry. Bit closer to home now perhaps.

The story was already the most horrible labour abuse this year, but it’s even worse than you might think.

It turns out that, prior to the August 16 incident, the miners appealed to their local union, the NUM, who asserted that they had no case against the mine’s operators and -wait for it- there are reports that union officials even fired shots to disperse the workers. Problem is, NUM is the only union recognised by the Council of South African Trade Unions (COSATU) and affiliated to the ruling African National Congress political party. The NUM and ANC share offices.

Furthermore the former NUM Secretary, Cyril Ramaphosa, has substantial business interests and is now a Lonmin boardmember (conflict of interest, much?)

Many workers grew tired of having their issues soft-peddled and had joined the non-COSATU-affiliated AMCU which greatly exacerbated the tensions at the mine.

It’s no fun to report bad news about our heroes. Ramaphosa was one of the people who brought about the end of Apartheid and was there to welcome Mandela when he was freed from prison. However, as is usually the case, the new kids on the block aren’t angels either and should not enjoy uncritical endorsement.

The international community has not made this adjustment. No specific demands were made of South Africa in the aftermath. Sharan Burrow of ITUC called for the perpetrators “to be brought to justice” but that was about it. IndustriALL unsurprisingly backed the NUM, its affiliate. Amnesty was silent (actually they have their own problems right now). Human Rights Watch merely quibbled over the Enquiry’s terms of reference.

I might add that the miners weren’t entirely innocent in this either. In the confrontation that lead to the shooting, the crowd was armed.

I’m going to suggest that the entry of AMCU greatly inflamed the problem and that the miners would have done better to work for better representation within the NUM than to try to work around it. It’s almost a pointless observation though, made from the comfort of my broadband-connected middle-class dwelling on the other side of the Indian Ocean. No one is pointing a gun in my face.

The most ironic thing of all is that the impetus for change may come neither from the workers or from overseas do-gooders, but from investors who’ve now been spooked and will hold back. Of course, you can’t even write to your pension fund and ask them to pressure Lonmin Inc to listen to the workers’ demands (rather than simply withdrawing their money), the funds are obliged to follow the market’s signals. It really depends on South Africa’s political leaders to appreciate what is at stake.

Sources:

Electronic trading’s ethical vacuum

Posted: August 30, 2012 in Ethical decision-making, Natural Resources
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English: in Chicago, Illinois, USA.

English: in Chicago, Illinois, USA. (Photo credit: Wikipedia)

I’m sorry, Dave. I’m afraid I can’t do that.

-The shipboard computer HAL in 2001: A Space Odyssey

For a while, I worked in the Chicago Loop.

I’d always turn to glance at the impressive Board of Trade building with its Art Deco statue of Ceres, the god of agriculture, dominating LaSalle Street as far as Lincoln Park, at which point the street bends slightly westward.

A short walk away, on the other side of the River, lies the Chicago Mercantile Exchange. In 2007 the two merged and became one company. It’s the largest futures and commodities exchange on the planet.

The prices of oil, wheat, corn, cocoa, copper, tin, oil, tantalum … you name it … are largely set on this exchange, along with the fates of millions of primary producers around the world.

I recently learned something fascinating: the blocks around these two exchanges are starting to bristle with microwave dishes. Trading companies want to know what’s happening in the CME servers those few thousandths of a second faster than their competitors relying on copper-cable based internet connections.

Why? Because today the majority of trading is done by computers, without the input of a human being.

The computer decides to buy or sell based on algorithms, and it does it many many times faster than the guys in the mustard yellow jackets can.

Admittedly, these traders don’t exactly go around touting their moral credentials (see earlier post) but a computer can’t even pretend. Non-monetary values are invisible to it. All that triple bottom line stuff? Not in the program. E-trading programs don’t care, don’t even know that a huge spike in the price of corn is going to take food off tables around the globe.

Bad enough that people have to contend with natural disasters, but this has come about because people have willfully taken their hands off the wheel.

It’s the same story on Wall Street – a similar proportion of company stocks are traded electronically. It’s no surprise that institutional investors fail to exercise their voting rights at AGMs: the real-life people in those companies don’t even know what stocks they are holding and what they are selling. That emphasis on quarterly results at all costs, and the harmful short-term thinking that it engenders, is increasingly being done to appease these ‘robot overlords’. Worse, I don’t hear anyone out there with the stomach to seriously challenge the wisdom of this system.

Fact starts to emulate science fiction.

*Update (3 October): New York Times reports that several other jurisdictions are seeking to rein in high-speed trading. No sign on Wall Street or Chicago’s South Loop however. The article also says that 65% of U.S. stock trades that are performed by computers. Here’s the link: Beyond Wall Street, Curbs on High-Speed Trades Proceed (New York Times, 26 September 2012)

Further reading:

Conflict minerals disclosure not as easy as it seemed

Posted: January 24, 2012 in Consumer campaigns, Natural Resources
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Refugee camp for Rwandans located in what is n...

It’s been 18 months since the Dodd-Frank Act was passed yet the Securities and Exchanges Commission (SEC) remains bogged down in the detail of how to implement Section 1502, the requirement that companies declare if they source particular minerals from the Democratic Republic of Congo or its neighbouring countries.

Had it gone into force on time, the soonest disclosure would have been for the financial period ending 31 December 2012. Assuming the SEC can stick to its current schedule, the soonest reporting period would now be mid-2013.

Background

The impetus for this rule is a story that has been woefully under-reported in Western media. In the last fifteen years, about five million people have been killed in the Second Congo War which has raged through numerous central African countries. It’s the worst deathtoll of any conflict in nearly 70 years, yet barely registered a peep on most news channels. The Second Congo War had something like fifty times the death toll of the War in Afghanistan since 2001 yet would be lucky if it received one fiftieth of the coverage. Few people are even aware of it – so much for the information society!

Where did all the arms and ammunition come from? Apparently a good deal were purchased with earnings from the mining of certain rare minerals including coltan (a compound that includes the metal tantalum, used in nearly all electronics).

Today the warring parties are, officially, at peace now but in 2010 someone felt it would be a good idea to impose a reporting obligation on companies that source minerals from the Democratic Republic of Congo, so Americans’ money doesn’t end up buying guns for warlords. I can’t help thinking that this is a case of closing the stable door after the horse has bolted … long, long after the horse has bolted … but that’s the plan.

The SEC has been charged with the responsibility of implementing this requirement. The most recent public event was a roundtable in Washington last October. In it you can see various parties spelling out just what an impost it will be to adequately trace where a metal comes from. The reason is, the supply chain is far more complicated than Congress probably realised. Firstly, raw materials from all over the world get mixed together as the smelting stage so, unless you set up a separate, conflict-free smelter, you will find yourself bound by the reporting obligation. Secondly, tantalum and other rare metals end up in many, many products and not just the obvious ones like cellular phones. Basically anything that contains a circuitboard. It seems that the net is going to end up being cast extremely widely. It is turning out to be as broad as trying to make people report the presence of palm oil or phosphate in their supply chain.

California goes it alone

Meanwhile California has gone and passed its own law, the Transparency in Supply Chains Act, which requires all large California-based companies with overseas operations to disclose what they are doing to ensure that their suppliers adhere to environmental, labour and other standards and to post this disclosure ‘conspicuously’ on their website.

Hopefully this will provide activists with leverage to pinpoint where improvements aren’t being made. Looking at some of the disclosure statements so far, however, they seem to be written in flowery euphemistic language and no more useful than the existing CSR content of Annual Reports. It seems likely that test cases will have to be litigated.

Source:

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Nestlé finally does something about child labour

Posted: December 1, 2011 in Consumer campaigns, Natural Resources
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Change has come to the world’s biggest food company!

In the last few days Nestlé has finally agreed to allow independent auditing of its cocoa supply chain and propose ‘remedial strategies’ if child labour is proven.

In stark contrast to the reassurances given by Nestlé’s suppliers in the film The Dark Side of Chocolate, the company this week admitted “We are sure that there are children working”.

Best of all, the process will be led by the multi-stakeholder Fair Labor Association which means we can expect the reporting to be free and fearless.

This is a great moment for all who’ve been involved in the chocolate campaign, notably the International Labor Rights Forum (ILRF) who have pushed the issue for the last several years.

Opportunity to gain further ground – Act now!

An additional opportunity exists right now to raise standards. The United States Government has a procurement policy that prevents it from sourcing either Cote d’Ivoirian cocoa or Uzbek cotton without a ‘good faith’ certification that child labour was not involved. Bizarrely the Executive Order that makes this stipulation only applies to the raw materials and not to chocolate made out of the cocoa or T-shirts made out of the cotton. I’m not sure how often the U.S. Government has cause to order raw cocoa.

The Executive Order has come up for public comment though only until 3 December, so now is the time to remind Washington decision-makers to fully implement the intention of the policy all the way along the supply chain.

Add your voice here: http://action.laborrights.org/p/dia/action/public/?action_KEY=3205

Source:

http://www.confectionerynews.com/Regulation-Safety/Nestle-sure-child-labour-occurs-in-supply-chain-as-company-allows-probe

Earlier posts on this story:

Industry-led Fairtrade certification … hmmm

Posted: October 13, 2011 in Consumer campaigns, Ethical decision-making, Natural Resources
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Kit Kat Chunky and Kit Kat Chunky Peanut Butte...

Image via Wikipedia

Last week it was my pleasure to sit on a panel with Carol Hirt of Not4Sale Australia, the anti-slavery group, in a discussion about the documentary film The Dark Side of Chocolate.

A question from the floor that got me thinking was, What certification should we be looking for?

While she was happy to give the benefit of the doubt, Carol did make the observation that industry-run certification efforts would surely warrant closer examination than those led by concerned citizens.

She also observed that the big chocolate companies have a track record of releasing one Fairtrade product with little promise of further action.

It recently passed 10 years since the chocolate industry signed the Harkin Engel Protocol, intended to eliminate child labour. Not only has child labour manifestly not been eliminated; there is no clear evidence that it has even been reduced in the last decade.

The chocolate industry has been treating itself pretty lightly and when you take a look at who polices them it is hardly surprising. Nestlé, the world’s biggest food company, has in ten years managed to get one single product fairtrade certified: The Chunky Kit Kat. One has to ask how serious a commitment this represents. The primary effect, so far as I can see, is to ward off criticism by showing that the company is doing “something”.

Their certifier is the industry-backed Utz Certified group (whose logo appears on Chunky Kit Kats). Unlike the better-known Fairtrade certification, Utz Certified does not set a minimum or guaranteed price for producers, making it a considerably cheaper option for companies seeking ethical endorsement. Instead it works on the principle of ‘continuous improvement’. Well I guess having one product line endorsed, after ten years, is better than none but it’s not exactly a six sigma black belt result.

Lawyers figured this out a long time ago

I stand to be corrected but I can’t see what motivation industry-led initiatives have to set very high standards. There is an ancient legal maxim, Nemo iudex in causa sua, which translates to “No one should be judge in their own case”. In other words, the industry groups are funded by industry and talk only to industry (funnily enough). Not to NGOs. Not to local suppliers. Not to governments. It’s just difficult to imagine them being too hard on the people who pay their salaries. We are all a bit like that; that’s what independent auditors are for. Personally I’m going to look for the blue and green Fairtrade Certified logo next time, I have a lot more confidence in it.

Related posts:

$2 an hour to work on an inhospitable mountain peak

Posted: September 27, 2011 in Economic Development, Indonesia, Natural Resources
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Continuous casting copper disc (99.95% pure), ...

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Copper is ubiquitous in modern life. Its most common use today is in electrical wiring – more than half of it is used for this purpose.

The cables that connect your mouse to your computer screen, your computer to the power socket, and your phone line to the outside world, all use copper.

In fact copper cables run under the oceans between continents. They carry the bits of information from me writing this post to various cloud computing servers around the world. There it waits for you to retrieve it – more data, more copper wires. The “cloud” metaphor (not to mention the advent of wireless connectivity) are somewhat misleading. It is still a heavily cable-dependent world.

The world’s largest single copper deposit is the Grasberg open-pit Mine in the Indonesian province of West Papua. It supplies about 4% of the world’s output and is also Indonesia’s largest taxpayer.

It is located in the most astonishingly improbable location: just 8 kilometres – literally walking distance- from the peak of Indonesia’s highest mountain. The area is characterised by glaciers. It is a very, very long way from civilisation – over 3,000 kilometres from the Indonesian capital Jakarta. The mine’s operator, the Freeport-McRohan Company, regularly flies its expat staff to the Australian resort town of Cairns for rest and relaxation.

No such perks for the Indonesians who work at this remote, inhospitable site, performing work that is both difficult and dangerous. In Australia unskilled workers at remote mining sites are lured by pay rates of $100 an hour for living so far from friends and family. The mining industry is so extraordinarily profitable that companies such as BHP and Rio Tinto can pay this without having to worry too much about it. Their biggest costs are infrastructure and extraction. Wages are trifling in comparison. Moreover copper extracted in Australia carries the same price on the commodities exchanges as copper extracted in Indonesia.

Yet believe it or not, Freeport-McRohan is currently having a dispute with the Indonesian workers of the mine who are paid roughly $2.00 an hour and want a pay rise to a globally competitive $17-$43 an hour. There is no question that the company can afford it, yet they won’t pay, so the workers are now on strike. It will be very interesting to see how far they get.

**Updated 15 December: The employees are going back to work on Sunday, after three months on strike. The company agreed to pay a 39% pay increase.

Read more:

Tropical fruit ain’t all summer fun

Posted: September 1, 2011 in Natural Resources, Rights around the world
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Pineapple on its plant, Costa Rica

Image via Wikipedia

This brief video gives an insight into life on the Costa Rican plantations that supply a quarter of the bananas and three-quarters of the pineapples sold in Europe.

Since this film was made, twenty-five local pineapple workers were sacked for joining their trade union ANEP. They were employed by Bana Internacional Arero and Natura Farms LWO [unrelated to the Minnesota company of the same name].

They sought the protection of the union to assist with noncompliances including:

  • failing to register contractors for health and social security
  • not allowing holidays
  • not paying the thirteenth month (because wages are four-weekly)
  • not paying overtime
  • paying migrants less than the minimum wage
  • use of the chemical Carbofuran, which is banned on imports by the U.S. Environment Protection Agency
Their case has been taken up by the country’s opposition political party, who have asserted that the Ministry of Labour has been asleep at the wheel. Costa Rica’s government has also been criticised by the ILO for its failure to uphold the right the free association.
Sources:

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Another raw material that comes at a high price: Tantalum

Posted: April 15, 2011 in Natural Resources, Rights around the world
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A high purity (99.999 %) tantalum single cryst...

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As I blogged a while back, cocoa sourcing is a pretty sorry story. Nearly half the world’s cocoa beans come from Cote D’Ivoire. There are many child slaves put to work harvesting the cocoa that ends up in our Cadbury blocks and Snickers bars. Then the tax revenues have been propping up the election-stealing ex-President Laurent Gbagbo. It’s about as bad as it gets. Notwithstanding all this the situation continues because, mainly, the cocoa is not purchased directly from the harvesters but in commodity exchanges based in Europe. The confectionery companies throw their hands in the air and say We don’t *know* where any particular bag of cocoa comes from.

Funny that. Throw in a change of regulation and people miraculously find they are, after all, capable of tracking country of origin.

This is exactly what has happened recently with tantalum mining. Tantalum (a.k.a. coltan) is a small but necessary ingredient in electronic components. Scandalously, over one-third of the world’s supplies had been coming from illegal mining operations overseen by guerilla groups in the Democratic Republic of Congo. The used the revenue from sales of the material to purchase arms.

Mid last year the United States Congress passed the Wall Street Reform and Consumer Protection Act. A clause was inserted requiring companies that supply tantalum, gold and a number of other precious metals not merely to assert that they do not source it from conflict zones but to actually audit and prove this.

Now … why is that so difficult for cocoa producers? It’s not. They just can’t be bothered unless they really have to.

This is the brilliant viral ad that goaded the legislators into action:

Sources:

No Dirty Gold campaign making headway

Posted: April 8, 2011 in Consumer campaigns, Natural Resources
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Looking out across the lower half of the Porge...

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“No Dirty Gold” is a project of not-for-profit group Earthworks.

Launched in 2004 it has been strikingly successful in getting jewelers and other retailers to sign on to their ‘Golden Rules’ of responsible gold mining, namely:

  1. Respect basic human rights outlined in international conventions and law
  2. Obtain the free, prior, and informed consent of affected communities.
  3. Respect workers’ rights and labor standards, including safe working conditions
  4. Ensure that operations are not located in areas of armed or militarized conflict
  5. Ensure that projects do not force communities off their lands
  6. Ensure that projects are not located in protected areas, fragile ecosystems, or other areas of high conservation or ecological value
  7. Refrain from dumping mine wastes into the ocean, rivers, lakes, or streams
  8. Ensure that projects do not contaminate water, soil, or air with sulfuric acid drainage or other toxic chemicals
  9. Cover all costs of closing down and cleaning up mine sites
  10. Fully disclose information about social and environmental effects of projects
  11. Allow independent verification of the above

Big news came a couple of weeks ago when Target USA, the nation’s third largest retailer, signed on. Way to go!

Target is the 34th major retailer to pledge support.

Jewelers of America, a national association representing over 10,000 jewelry retailers, has endorsed the campaign’s long term objectives.

No Dirty Gold is the perfect example of a responsibly-conducted labour rights campaign. They aren’t letting up either; Costco is next in their sights.

See also:

  • Dirty Gold (7 Feb 2011) – links to HRW photo essay about the effect of the Porgera Gold Mine on the local community
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