It’s time for Brazil to join the Extractive Industries Transparency Initiative

Ana and her family live one kilometer from the tailings dam that carries toxic waste away from the world’s ninth largest iron ore mine, Minas-Rio, situated in Brazil’s mining heartland state of Minas Gerais.

Thoughts of the dam rupturing never leave her.

“We live here between the hope of being able to leave and the constant fear of something bad happening. We sleep in fear, we wake up in fear. It’s an endless fear,” says the 21-year-old student, who doesn’t want to use her real name for security reasons.

On 5 November 2015, a tailings dam collapsed at the Samarco Mariana mining complex in Minas Gerais, releasing 11.7 million cubic meters of liquid waste. It killed 19 people, left hundreds homeless, and pollutants flowed 600 kilometers down the Rio Doce to the Atlantic Ocean.

Just over three years later, another environmental catastrophe hit Minas Gerais, when the tailings dam at Córrego do Feijão iron ore mine in Brumadinho gave way on January 25, 2019. A torrent of mud and mining waste killed 270 people and caused untold environmental damage.

For Ana and others in her close-knit community, disaster anxiety is compounded by the impact the mine already has on their lives.

“We live with noise pollution 24 hours a day. There is also the stench of the dam which is very strong… Before the mine there was a waterfall, a river. Today there is no more. The river is polluted, [there are] no fish,” she says.

Human rights 

Ana’s testimony echoes the wider story of Brazil’s extractive sector.

Those living near mining, oil and gas operations rarely benefit from them. Instead their life quality invariably drops, while the wealth these industries generate flows into the hands of a small minority.

The lack of transparency and accountability which enables this is laid bare in a new report by Brazilian NGO IBASE (Instituto Brasileiro de Análises Sociais e Econômicas) and global transparency coalition Publish What You Pay.

Our report focuses on Minas-Rio, which is owned and operated by UK multinational Anglo American, and which makes vast profits exporting iron ore to China, while leaving little behind for local communities.

It documents how communities – including Ana’s – have suffered numerous environmental and human rights impacts since development began on Minas-Rio in 2009.

These include contaminated streams, rivers, pastures and farmland; water shortages, which have reduced local food production (agricultural production in the local municipality of Conceição do Mato Dentro has declined by two-thirds since advent of Minas-Rio); and dust plumes, leading to respiratory diseases, particularly among children and older people.

While a direct causal link remains unproven, municipal data shows increases in violence, including against women, since the opening of the mine. Ana is among those who have little doubt about the connection between the two.

“[Before the mine opened] we could come and go. Women could walk alone without much fear. After the mining company arrived, the violence here increased a lot. Our freedom ended,” she says.

Many of those worst affected by the mine live on scattered family farms often linked by kinship ties, and are of Afro-descendant ethnicity: a disproportionate impact which could be classed as a form of systemic racism.

Too little transparency 

Our research also exposes the Brazilian government’s lack of transparency and accountability at national and subnational levels for the mining tax and royalty receipts it gets from the companies it grants concessions to.

Under UK extractive industry transparency regulations, Anglo American – which is listed on the London and Johannesburg stock exchanges and UK incorporated – publishes its disaggregated payments to all governments worldwide annually.

For Minas-Rio, payments reported by Anglo American as made between 2015 and 2018 totalled $79.9 million. Yet we found that the local municipality, Conceição do Mato Dentro, fails to report to citizens how it spends its share of the money received from the mining company via the national mining agency, and that it’s possibly receiving a smaller share of royalties than it’s due. This falls short of international best practice.

Pressure for change

While the study focuses on a single mine, it sheds light on the wider problems surrounding mineral extraction in Brazil and beyond.

Around Minas-Rio – and countless other mines and oil wells around the world – people are living in poverty and environmental degradation. But pressure for extractive companies to remove the stain of environmental and human rights violations from their supply chains is growing stronger, with mounting calls from civil society and investors.

One concrete way for Brazil to heed these calls would be by joining the Extractive Industries Transparency Initiative (EITI), as 11 other Latin American and Caribbean countries have already done.

The EITI leads the implementation of global standards for the good governance of oil, gas and mineral resources. It enables the kind of transparency and accountability, and a forum for dialogue between government, industry and civil society, that Brazil’s extractive sector desperately needs.

Removing the shroud of secrecy that still cloaks much of the extractive sector requires governments – including Brazil’s – to make oil, gas and mining data accessible to their citizens, by, among other things, publishing the full texts of all contracts, licenses, concessions and other legal agreements.

What’s more, for the human rights of those living near mines to be truly respected, companies proposing new mining projects should be required to conduct and publish comprehensive human rights impact assessments and to secure the free, prior and informed consent (FPIC) of local communities – as recommended by the International Council on Mining and Metals, which counts Anglo American, BHP and the Rio Tinto Group among its members. Companies operating current mining projects should publish and consult locally on human rights impact reports with new assessments every three years. When public concerns like those we have identified at Minas-Rio arise, companies should publish and implement human rights management plans to address them.

Anglo American maintain that sustainability is at the heart of its decision-making, and that it “strictly complies with the applicable legislation and has its activities licensed and monitored by the competent authorities” while following “the best international standards and guidelines.” The mayor of the Conceição do Mato Dentro said the municipality would go broke without the mine, and that Anglo American is actively supporting sustainable development in the area.

Many living near Minas-Rio disagree.

“If government officials really saw us as people affected by mining, we would not be living [like this]. But it’s like we don’t exist. It’s like there are no people in our community,” says Ana.

Athayde Motta is Executive Director of IBASE and Miles Litvinoff is the former Director of PWYP-UK.