Tag Archives: Canadian mining companies

Corporate Canada behind slow motion coup attempt in Venezuela

It’s convenient but incorrect to simply blame the USA for Ottawa’s nefarious role in the slow motion attempted coup currently underway in Venezuela.

Critics of the Liberal government’s push for regime change in Venezuela generally focus on their deference to Washington. But, Ottawa’s hostility to Caracas is also motivated by important segments of corporate Canada, which have long been at odds with its Bolivarian government.

In a bid for a greater share of oil revenue, Venezuela forced private oil companies to become minority partners with the state oil company in 2007. This prompted Calgary-based PetroCanada to sell its portion of an oil project and for Canadian officials to privately complain about feeling “burned” by the Venezuelan government.

Venezuela has the largest recognized oil reserves in the world. The country also has enormous gold deposits.

A number of Canadian companies clashed with Hugo Chavez’ government over its bid to gain greater control over gold extraction. Crystallex, Vanessa Ventures, Gold Reserve Inc. and Rusoro Mining all had prolonged legal battles with the Venezuelan government. In 2016 Rusoro Mining won a $1 billion claim under the Canada-Venezuela investment treaty. That same year Crystallex was awarded $1.2 billion under the Canada-Venezuela investment treaty. Both companies continue to pursue payments and have pursued the money from Citgo, the Venezuelan government owned gasoline retailer in the US.

In 2011 the Financial Post reported, “years after pushing foreign investment away from his gold mining sector, Venezuelan President Chavez is moving on to the next stage: outright nationalization.” Highlighting its importance to Canadian capital, the Globe and Mail editorial board criticized the move in a piece titled “Chavez nationalizes all gold mines in Venezuela.”

In a further sign of the Canadian mining sector’s hostility to the Venezuelan government, Barrick Gold founder Peter Munk wrote a 2007 letter to the Financial Times headlined “Stop Chavez’ Demagoguery Before it is Too Late”: “Your editorial ‘Chavez in Control’ was way too benign a characterization of a dangerous dictator — the latest of a type who takes over a nation through the democratic process, and then perverts or abolishes it to perpetuate his own power … aren’t we ignoring the lessons of history and forgetting that the dictators Hitler, Mugabe, Pol Pot and so on became heads of state by a democratic process? … autocratic demagogues in the Chavez mode get away with [it] until their countries become totalitarian regimes like Nazi Germany, the Soviet Union, or Slobadan Milosevic’s Serbia … Let us not give President Chavez a chance to do the same step- by-step transformation of Venezuela.” A year earlier, the leading Canadian capitalist told Barrick’s shareholders he’d prefer to invest in the (Taliban controlled) western part of Pakistan than in Venezuela or Bolivia. “If I had the choice to put my money in one of the Latin American countries run by (Bolivian President) Evo Morales or Venezuelan President Hugo Chavez — I know where I’d put my buck,” said Munk, referring to moves to increase the public stake in resource extraction to the detriment of foreign investors.

Benefiting from the privatization of state-run mining companies and loosened restrictions on foreign investment, Canadian mining investment in Latin America has exploded since the 1990s. No Canadian mining firm operated in Peru or Mexico at the start of the 1990s yet by 2010 there were nearly 600 Canadian mining firms in those two countries. Canadian mining companies have tens of billions of dollars invested in the Americas. Any government in the region that reverses the neoliberal reforms that enabled this growth is a threat to Canadian mining profits.

Corporate Canada’s most powerful sector was none too pleased with Chavez’ socialistic and nationalistic policies. Alongside Canadian mining growth, Canadian banks expanded their operations in a number of Latin American countries to do more business with Canadian mining clients. More generally, Canadian banks have benefited from the liberalization of foreign investment rules and banking regulations in the region. A few days after Chavez’s 2013 death the Globe and Mail Report on Business published a front-page story about Scotiabank’s interests in Venezuela, which were acquired just before his rise to power. It noted: “Bank of Nova Scotia [Scotiabank] is often lauded for its bold expansion into Latin America, having completed major acquisitions in Colombia and Peru. But when it comes to Venezuela, the bank has done little for the past 15 years – primarily because the government of President Hugo Chavez has been hostile to large-scale foreign investment.” While Scotiabank is a powerhouse in Latin America, Canada’s other big banks also do significant business in the region.

At the height of the left-right ideological competition in the region the Stephen Harper government devoted significant effort to strengthening the region’s right-wing governments. Ottawa increased aid to Latin America largely to stunt growing rejection of neoliberal capitalism and in 2010 trade minister Peter Van Loan admitted that the “secondary” goal of Canada’s free trade agreement with Colombia was to bolster that country’s right-wing government against its Venezuelan neighbour. The Globe and Mail explained: “The Canadian government’s desire to bolster fledgling free-market democracies in Latin America in an ideological competition with left-leaning, authoritarian nationalists like Venezuela’s Hugo Chavez is rarely expressed with force, even though it is at the heart of an Ottawa initiative.” An unnamed Conservative told the paper: “For countries like Peru and Colombia that are trying be helpful in the region, I think everybody’s trying to keep them attached to the free-market side of the debate in Latin America, rather than sloshing them over into the Bolivarian [Venezuelan] side.”

Ottawa wants to crush the independent/socialistic developments in Venezuela. More generally, the growth of Canadian mining, banking and other sectors in Latin America has pushed Ottawa towards a more aggressive posture in the region. So, while it is true that Canada often does the bidding of its US puppet master, capitalists in the Great White North are also independent actors seeking to fill their own pockets and thwart the will of the Venezuelan people.

Comments Off on Corporate Canada behind slow motion coup attempt in Venezuela

Filed under Black Book of Canadian Foreign Policy

Banro’s quest for Congo gold yields deaths, kidnapping

When one Canadian mining company goes, violence seems to follow.

Last week a police officer and soldier were killed at a Banro Corporation-run mine in the east of the Congo. One “assailant” was also killed at the Toronto-based company’s Namoya mine. In February three police were killed at another Banro mine about 200km to the southwest. An “assailant” was also killed at Twangiza in what the gold-mining firm labelled an attempted robbery.

In March, five Banro employees from Tanzania, France and the Congo were kidnapped at Namoya. Four of them were released over the weekend by a militia that had apparently been threatening the company for months. Claiming Banro expropriated their lands, the population near its Namoya mine want restitution so they can continue small-scale mining. A 2013 Jesuit European Social Center report pointed out that local communities have not been allowed to see the environmental impact study or community plan for the mine, and said the company paid the central government a million dollars for a tax exemption.

Banro operates in a region that’s seen incredible violence over the past two decades and the secretive company has been accused of fuelling the conflict. In 1996 Banro paid $3.5 million for 47 mining concessions that covered more than one million hectares of land in Congo’s North and South Kivu provinces. At the time over one million refugees were in eastern Congo, and in September 1996 Rwandan (and Ugandan) forces invaded the area.

Resources fuelled the Rwandan/Ugandan invasion. Prominent Belgian Great Lakes journalist Colette Brackman produced a map showing that the zigzag progression of the Rwandan-backed rebels was based on the location of minerals. Multinationals signed deals worth billions of dollars with Laurent Kabila’s rebels before he took office. In an article headlined “Mining Firms Want a Piece Of Zaire’s Vast Mineral Wealth,” the Wall Street Journal explained:

At a time when rebel forces are threatening to topple dictator Mobutu Sese Seko, Zaire’s vast mineral resources are beckoning foreign companies, prompting a scramble that recalls the grab for wealth 120 years ago in this vast land, once known as the Congo. American, Canadian and South African mining companies are negotiating deals with the rebels controlling eastern Zaire. These companies hope to take advantage of the turmoil and win a piece of what is widely considered Africa’s richest geological prize — and one of the richest in the world.”

Ultimately, the Rwandan forces marched 1,500km to topple the regime in Kinshasa. After the Congolese government installed by Kigali expelled Rwandan troops, they re-invaded, leading to an eight-country war between 1998 and 2003 that left millions dead. Since then, Rwanda and its proxies have repeatedly invaded the eastern Congo. At the end of 2012, the Globe and Mail‘s Geoffrey York described how “Rwandan sponsored” M23 rebels “hold power by terror and violence” in the mineral-rich east. The rebel group added “a [new] layer of administrators, informers, police and other operatives” in and around Goma, the capital of North Kivu province, in part to “bolster” its “grip on the trade in ‘blood minerals.'”

As one of the only western mining companies operating in the border provinces of North and South Kivu, Banro reportedly worked closely with the Rwandan government. Keith Harmon Snow claims that “Canadian Banro Corporation is one of the most secretive corporations operating in Congo, and they have established and maintained their control through very tight relations with the Kagame regime. Banro has taken over thousands of hectares of South Kivu province by manipulating the local mwamis (chiefs), by bribing officials and by infiltrating officials into power who are friendly to Banro and Kagame’s interests.”

Upon expelling Rwandan troops from the Congo in 1998, Laurent Kabila revoked Banro’s concessions. With all of its business activity in eastern Congo, the company responded by filing a $1-billion “unlawful” expropriation claim at the International Centre for Settlement of Investment Disputes in Washington. In “Digging Deeper: How the DR Congo’s Mining Policy is Failing the Country,” Dominic Johnson and Aloys Tegera explain:

“On July 29, 1998, just before war again started in Congo, President Laurent-Désiré Kabila annulled the Banro deal and gave ex-Sominki to a newly created Congolese state company called Somico (Société Minière du Congo) led by a Kivu traditional leader. Much of the subsequent fighting around Eastern Congo’s mining pitted Banro supporters, mostly supporting the [Rwandan backed] RCD rebels and backed by business interests, against Somico supporters, mostly consisting of Mai-Mai and supported by the Kabila government.”

Alongside the regional peace accord that officially ended the eight-country war in the Congo, Joseph Kabila (who took over after his father was assassinated) returned the concession to Banro in 2003.

Canadians have heard almost nothing from the dominant media about Banro’s violent quest for billions of dollars in minerals. The little that has been reported is mostly the company justifying its operations. But where are the voices of ordinary Congolese? Don’t they deserve to be heard?

Canadians need to know what this country’s mining companies are doing around the world.

Comments Off on Banro’s quest for Congo gold yields deaths, kidnapping

Filed under Canada in Africa

Canada in Africa book tour begins this week

Stephen Harper is not The Problem but getting rid of him is a necessary first step in changing Canada’s militaristic, pro-corporate international posture that focuses on what’s best for business rather than helping the world’s poorest.

This will be one of the messages during a 20-city pre-election tour for the just-released Canada in Africa: 300 Years of Aid and Exploitation. Author Yves Engler says one important reason for writing the book was to educate Canadians about what the government is doing in their name around the world. “The more Canadians understand our foreign policy the more they will be upset. My goal is to prod people into voting as global citizens. The more we see ourselves as part of a collective humanity the less likely we are to vote Conservative.”

Engler’s new book, following on The Ugly Canadian — Stephen Harper’s Foreign Policy, reveals how over the past decade the Conservatives have aggressively worked to increase corporate mining profits in Africa at the expense of local communities and how in 2011 they waged an illegal war on Libya, destabilizing that country and surrounding states. The book details diplomatic bullying and the spending of tens of millions of tax dollars to promote privatizations, trade agreements and other “aid” to “private” corporations. Most troubling of all, the book describes the damage Harper’s environmental policies are having and will continue to have on the continent least responsible for, but most at risk from, climate change.

But, the book also argues, Canada’s hostile posture towards Africa didn’t begin with Harper.

“Unfortunately Canada’s policies towards Africans have long been colonial and racist,” says Engler. “My research has uncovered a distressing legacy of shameful Canadian behaviour going back even before Confederation.”

The author offers a taste of the book in the following:

Top 10 Things You Didn’t Know About Canada’s Role in Africa.

  • Canada delivered (free of charge) billions of dollars in weaponry to the colonial powers during the last decade of colonial rule.
  • Canada trained the army command that overthrew Ghanaian independence leader Kwame Nkrumah and Canada’s high commissioner privately celebrated the coup.
  • A Canadian led the expedition to conquer the Katanga region of the Congo on behalf of Belgian King Leopold II.
  • In exchange for land near present-day Harare a Canadian missionary organized health services for Cecil Rhodes’ army that conquered Zimbabwe.
  • Canadian military officials were complicit in the killing of Congolese independence leader Patrice Lumumba.
  • An Ottawa-based consulting firm has overseen the privatization of tens of billions of dollars in public African infrastructure.
  • Much of Atlantic Canada’s early wealth was generated from feeding Caribbean slave plantations.
  • Canadians rose to become governors of colonial-era Ghana, Kenya and Northern Nigeria.
  • Canadian officials were initially sympathetic towards Idi Amin’s coup in Uganda.
  • Canadian mining companies dominate resource extraction in Africa.

For more information about the book and the tour: https://yvesengler.com/ or email yvesengler [at] hotmail.com

Comments Off on Canada in Africa book tour begins this week

Filed under Canada in Africa

Good for business, bad for Africans

Sometimes what is good for business can be bad for people. Most Canadians understand this and cherish their right to protest “bad deals” and to elect new governments willing to reverse so-called “business-friendly” policies. This is called democracy.

So what do we call it when Ottawa signs a deal with an unelected regime that would prevent any future elected government in a small African nation from changing its laws regulating Canadian-owned mines for almost two decades?

In April Harper’s Conservatives signed a Foreign Investment Promotion and Protection Agreement (FIPA) with the interim government of Burkina Faso. According to the official release, the West African nation was represented at the signing ceremony in Ottawa by Prime Minister Yacouba Isaac Zida, who was deputy commander of the presidential guard when Blaise Compaore was ousted by popular protest last October. A U.S. and Canadian trained Lieutenant Colonel, Zida is one of five military men in a cabinet overseeing the landlocked country’s transition towards elections after President Compaore’s 27 year rule.

While the caretaker government is supposed to move aside after an election planned for October, the investment treaty will live on for at least 16 years. According to the FIPA, “the termination of this Agreement will be effective one year after notice of termination has been received by the other Party.” The subsequent line, however, reads that “in respect of investments or commitments to invest made prior to the date when the termination of this Agreement becomes effective, Articles 1 to 42 inclusive, as well as paragraphs 1, 2 and 3 of this Article, shall remain in force for a period of 15 years.” In other words, any elected government will be effectively bound by the accord for another decade and a half.

The FIPA’s Investor State Dispute Settlement mechanism clearly undermines (forgive the pun) democracy. It gives Canadian corporations the right to sue Burkina Faso’s government – in a private, investor-friendly international tribunal – for pursuing policies that interfere with their profit making. While Ottawa says the process protects Canadian investors “against discriminatory and arbitrary practices”, it also undermines the public’s ability to determine economic policy.

What is of concern to the Conservatives is the impoverished nation’s mining sector, which is dominated by corporate Canada. Since ousting Compaore, community groups and mine workers have launched a wave of protests against foreign-owned mining companies. After local residents damaged equipment in January, Vancouver’s True Gold Mining shuttered its Karma gold project and an official from Montréal-based Semafo recently told Bloomberg that the company was looking to fund a new police unit that would focus on protecting mining interests.

Under the FIPA a Canadian mining firm could sue if the central government listened to a community opposed to a mine. Canadian companies have already used investment treaties to claim hundreds of millions of dollars in damages from Latin American countries that withdrew mining licenses after stiff local resistance.

A company could also sue if a new government required a certain level of domestic purchasing. The accord explicitly precludes “domestic content” requirements or any effort to “accord a preference to a good produced or service provided in its territory.”

At a broader level, the aim of the FIPA is to counter a resurgence of “resource nationalism”. Having received a free hand during the last decade of Compaore’s rule, Canadian companies fear a reversal of these policies. So, they seek rights to sue the country if a new government expropriates a concession, changes investment rules or requires value added production in the country.

Over the past decade Canada has become a mining superpower in Africa and the Conservatives have aggressively pushed the industry’s agenda. To protect $31 billion in Canadian mining investment from policy shifts, the federal government has signed or negotiated FIPAs with 15 African countries and officials have sent a message that aid is more likely to flow to a government that signs a FIPA.

The Conservatives are undermining African democracy in their haste to defend mining companies. It is unjust to persuade an elected government to concede power to an international investment tribunal and simply indefensible to sign a deal with an unelected transition administration that binds future governments.

Comments Off on Good for business, bad for Africans

Filed under Canada in Africa