четверг, 6 февраля 2014 г.

How to reduce the conflicts with mining companies and locals. Kyrgyzstan - Talas - Andash - Djeruy (Part I)

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 I.
Where do payments move?
All payments: paid by the mining company, move to the republıcan budget (state budget). The representatives of the mining companies suggest that some of these payments, entering the republıcan budget earmarked for the development of social infrastructure in regions (oblast) of country. Namely, it shall be the construction of social facilities, repairing of roads, bridges and communication facilities, power supply, land and soil restoration, removal of tailings, compensation to farmers and other residents who have received some damage from the mining exploration. Thus, by addressing these payments to state, the mining company compensates for possible environmental and economic damage.
From the text of the report “The position of the local population and local authorities toward their respect to mining at their territory[2]” should be following[3]. A lack of the legally guaranteed direct payments to the budget of Talas oblast and its districts influents on state of infrastructure. Also oblast’s budget itself receives direct deductions from payments to companies mining companies are not playing mutual role. The main reason – lack of transparency of republican and local budget. Same report also notes that: “Those amounts that have been paid by mining companies to the state in the form of statutory payments are not always spent directly to the needs of the local community”.
As noted earlier in this paper, the local people live in difficult social and economic conditions. The funds, which, are supposed to come from payments of mining companies could go on to form the funds prepared for the regional development. They can be directed to the development of the region, thereby increasing confidence in the public authorities and companies. However, at the moment this is not happening (regional development funds). There is still only a draft.
Who to trust?
The local population shows own distrust toward to mining companies and almost all state (governmental) agencies and branches. It currently does not see the benefits of mining.
None of the state agencies and branches do not possess direct vision to prevent conflicts between locals and mining company. Also they cannot conduct regular outreach for local people about what good and what damage can be from mineral development. Moreover, representatives of the local population do not possess the right and proved information. Their statements they often based on all sorts of rumors and speculation.
Definitely, that mining companies do not focus only on their profit and extracting of minerals. The government of Kyrgyz Republic is in attempt to assist all mining companies to prevent conflicts with local people, but all these action are very inefficient. Observing the state’s disability to provide normal conditions for mining companies, that extract mineral resources at the gold field, such companies are also losing confidence to government.
What was the main reason?
According to opinion the “Serep” Research Institute, the causes of the conflict roots in the following. Firstly, the reasons of the conflict between local people and mining company should be considered from two perspectives - the visible causes and the hidden causes. From an in-depth interview with the General director of Closed Joint-Stock Company (CJ-SK) “Andash Mining Company” Kuban Ashyrkulov, these perspectives were pointed out - visible and not visible. Regarding to the visible side - mostly there were voiced such causes as the environment, social injustice, lack of confidence. These causes are voiced very often by locals and mining company’s representatives, thus such causes lie on the surface of problem. The moot point is environment, because it is always necessary to express an expert opinion. Regarding to social injustice in front of local people it might be noted in difficult living conditions. Moreover, due to such conditions local population expresses different rumors and speculation about procedure of license acquisition and hypothetical possibility corruption schemes.
Finally high costs of mining equipment against economically deprived population living in the vicinity of the gold field.
As follows, there is popular locals’ opinion if mining company has invested so huge amount financial funds and taxes, so where population of oblast and district cannot utilize it as an infrastructure for them. This fact also initially creates mistrust.
As Kuban Ashyrkulov says, it is often expressed distrust only to foreign companies. Possibly, here the national and patriotic card is begun to play out. Basically we received such questions as: “Why does company explore [our - Author] gold field; [our] gold is taken; the mine is developed by foreign companies; why Kyrgyz companies are not able to extract gold”.

Secondly, as for the causes of the conflict are not visible, which is not mentioned, but which are taken into account in opinion by local people and mining companies. Basically, this is the own interests of certain groups from the number of local residents who use the conflict between locals and company as a source of funding. Also it is possible to influence and effect on the local population’s opinion by unfair competitors, who is looking for the ability to replace existing mining company at the gold field in Talas oblast.
The development strategy of Talas oblast was never designed and developed by all agreed representatives as an interested parties (stakeholders). Thus, it follows that the cause of the conflict between the local people and the mining company, is an inconsistency of the development strategy of Talas oblast. As a rule and according to standard practice the development strategy is supposed to be agreed  between the government of the Kyrgyz Republic, the state administration of Talas oblast, districts’ state administration, local authorities, and of course with wide range of local community’s representatives. In addition development strategy should take into account the interest of mining companies, associations that support the mining companies, non-governmental organizations, farmers and representatives of business structures.
In the conflict resolution the serious interest should express mining company as itself. In addition, it becomes apparent, that for the resolution of this mutual problem main role plays the association of mining companies in the Kyrgyz Republic, local government (of Talas oblast), and public authorities, in the face of the State agency of geology and mineral resources of the Kyrgyz Republic.
For the local population, who stays in quite difficult socio-economic conditions, the mining company is seen as a way to resolve their problems - mainly financial problems.
At the moment, the government is not able to timely and fast resolve all range of problems (unemployment among the local population, backwardness and inefficiency of the medical and educational institutions). Therefore, the local population about from such problems from the government to the mining company. Thus, the huge range of their requirements is addressed to the mining company. This strained relations between locals and mining company reinforce low infrastructure development (roads worn, dilapidated bridges, low electrification, lack drinking water, poor communication services). All these utilities, obviously, should provide normal life of the population. But now it is not clear who is really responsible for the social development of the population.

Sanjar Abakirov, “Serep” Research Institute

bibliography
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2. Development Fund for Law and Business (2011). The position of the local population and local authorities with respect to mining in their territory. Findings of the public hearings on the activities of mining companies in Talas, Naryn and Jalal-Abad oblasts of Kyrgyzstan, Bishkek, hotel «Hyatt».
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[1] Shamsutdinov RM Educational-methodological guide. KRSU. Bishkek.
[2] In this case, refers to the local population living in the immediate vicinity of the deposit (Auto)
[3] According to the materials of the report of the Development Fund of law and business, from April 15, 2011, Bishkek

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