Abstract
The Kyrgyz Republic is the third country in the Commonwealth of
Independent States in terms of gold production after the Russian Federation and
the Republic of Uzbekistan. At this point in the country there are more than
thirty significant gold fields. Currently there are operated gold fields such
as “Kumtor”, “Makmal” in The Kyrgyz Republic. In addition, there is a process
of preparation for the development such gold fields like “Djeruy” and also
“Andash” field[1].
Part II.
Is it necessary for government to interfere?
If the government will not participate in the resolution of the conflict
between local people and mining company, the situation may lead to a
deterioration in the investment climate, the loss of potential and existing
investors, as well as the decline of the mining industry in general. This will
seriously affect the economy, because all mining and fees paid by companies for
the extraction of minerals, are considered by the government of the Kyrgyz
Republic as a way to increase the income item of the budget.
The government needs to intervene because of the
following statements. The relationship between mining companies and the State
agency of geology and mineral resources of the Kyrgyz Republic, the Government
of the Kyrgyz Republic there is no clear, transparent, negotiated and agreed
with all stakeholders procedure distribution of funds received from the
company's payments to the state. Without
government intervention, these funds are not guaranteed to be directed
for the development of all oblast in general and Talas oblast in particular.
Also it will be necessary for the maintain expenses the environment
restoration.
In case of leaving this situation as unchanged, it is
expected the mutual risks that will occur mainly in the following:
- Reduce the investment attractiveness of the Kyrgyz Republic;
- Further weakening of state (governmental) power in the regions;
- The growth of conflict among the population in the oblasts
(districts);
- Depreciation of the institution of private property.
Problems of local character may also be indicated as
follows:
- Reduction of jobs and career prospects of the local labor force;
- Strengthening of internal and external migration among the local
population.
These risks exist but also could mutually arise in case of
non-interference by the government.
Through the systematic and permanent solution of the
problems of the local population, by improving socio-economic conditions in
oblasts (districts), the government will create conditions for the development
of agriculture, small and medium-sized enterprises, which would affect on the
reduction of unemployment, increase incomes. It will also influence on
improvement of the investment climate.
Interference by the government will create the material
basis for a number of socio- economic programs, programs for the development of
education and health in oblast. It will support innovations practiced by
farmers and entrepreneurs.
The scale of the
problem
In attempt of clearly and suspended the problem
situation “Serep” Research Institute consider described issue in the
geographical scope – the gold field “Andash”, located in the Talas region, at
north-east of Talas district of the Kyrgyz Republic. “Andash” gold field is
located at a distance of 75 kilometers to the east from Talas city (capital of
Talas oblast). The gold field differs with proximity of existing infrastructure
and access to roads. In close proximity to the mine located habitant village -
Kopuro Bazaar.
It is important to note that this field was discovered
and superficially investigated in 1962. The primary exploration was carried out
from 1982 till 1988. And the additional surveys occurred from 2004 to 2006.
According to data of State agency of geology and mineral resources of the Kyrgyz
Republic The deposit contains 20 tons of copper content of 0.6 grams per one
ton of empty ore[2].
The first signs of problems like conflict sentiments
of local population have been identified since (CJ-SK) “Andash Mining Company”
acquired a license to exploration and extracting mineral resources at gold
field “Andash” in 2004[3].
Also, this problem should be considered in the scale of the mining
industry of Kyrgyz Republic as a whole. The conflicts between local population
and mining companies appear not limitedly at the gold field “Andash” in Talas
oblast, but also at other gold fields by the country.
Is this problem
new or just re-issue?
The problem of the conflicts between local people and
mining companies in Talas oblast may be relevant for a long time, with the
possible prospect of further deterioration and growth. For almost seven years,
there has not been effective steps to resolve the situation with
social-economic situation in oblast. The conflict possibility could occur as
long as government develop and implement a wide range program of
social-economic development of the oblast and its districts.
It is assumed that the conflict problem will be
relevant as long as it will be developed and agreed the social-economy strategy
development for oblast upon by all parties (stakeholders) of the relationship
(the government of the Kyrgyz Republic, the State agency of geology and mineral
resources of the Kyrgyz Republic, the state administration of Talas oblast, the
state administration of Talas district, representatives of the local
population, the mining company, others).
For example, as a core act we could consider Chapter
num.6.1.2 of “The Country Development Strategy for 2009 - 2011 years”, approved
by the Decree of the President of the Kyrgyz Republic on March 31st 2009 N183
(hereinafter - the development strategy of the country). Chapter num.6.1.2 is
just establishing the general incompleteness of reforms, a tension between the
mining companies and the local population (without specifying particular
cases). This act does not contain any mechanism, that takes into account the
interests of local people and mining companies. Also it is visible a lack of
advocacy on the part of the authorities. On some methods and recommendations to
address and resolve the problem in this document does not say anything.
Background. What
has been done?
In fact, during the period from 2004 to 2012, the
government has not undertaken any effective steps to overcome these conflicts.
It is noticed, there has been issued a number of regulations with the direction
to solving the problem, holding meetings with stakeholders and events that
highlight the problem. Agency staff who supervised the activities of subsoil
users, law enforcement authorities, the government of the Kyrgyz Republic,
members of parliament of the Kyrgyz Republic, various news agencies have
visited the places where there is a conflict between the company. Also, there
have been cases when the funds were paid to the local population in a single
one-time assistance. The government here still takes the role of an outside
observer.
Mining companies operate in the country have changed
the key parameters of the local population. Thus, the management of these
companies has been repeatedly raised the issue of establishing a fund donated
by the public, have been working on strengthening the capacity of local
infrastructure and the capacity of the local community.
September 14th of 2011, on a open public discussion
was the draft of the bill that establishes amendments and additions to the Law
of the Kyrgyz Republic concern the non-tax payments”. The draft of bill “On the
non-tax payments” is interesting in terms of concepts such as “fees” and
“payments” which is proposed to introduce the concept of “taxes”. Thus, the
fourth paragraph of Article 2 of Bill establishes the term “royalties” as
follows: “as a state-set type of payment being made mandatory for subsoil
infrastructure development and maintenance of local importance”.
It is important that the text of the Bill determines
the appointment of non-tax payments - namely, the maintenance of a proper state
of infrastructure, health and educational institutions.
In addition, in order to resolve the conflict between
local communities and mining companies conducted outreach to local communities
as to how it will be conducted mining, what is the expected damage from mining
and how it will be conducted reclamation.
Sanjar Abakirov, “Serep” Research Institute
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