Niger: if Areva doesn’t pay the right taxes, why should citizens?

ROTAB – Publish What You Pay Niger got its hands on a convention regarding the contracts Areva – Niger and it is not all rosy. Once again, despite a strong Mining Code 2006, the Nigerien government chose to circumvent its law and regulations to please Areva.

Following lengthy opaque negotiations, a convention on Areva’s exploitation of uranium in Niger was finally signed on 16 July 2015. This contract covers the activities at Somair, the largest mine providing more than half of the country’s uranium. But why, almost three months after its signature, has this convention not been published in the official Gazette, as required by the Nigerien constitution?

According to ROTAB’s information, Areva will once again be exempt from paying taxes, such as VAT and tax on heavy equipment, in clear violation of the Mining Code 2006. In addition, it constitutes a breach to the regional regulation 18/2003/CM/UEMOA, which restricts tax exemption to the initial operational phase of a specific project and only for certain type of taxes. However, Areva has been operating Somair mine for over 40 years so its activities cannot be qualified as ‘in operational phase’! They merged into one contract the exploration and exploitation phases, which are normally kept separate, in order to avoid additional taxes. Moreover, the convention is not based on a sustainable development vision. Considering that the Somair mine will soon reach the end of its life cycle, management should proactively address its rehabilitation rather than intensify exploitation. Moreover, nothing in this convention obliges Areva to comply with ‘local content’ provisions such as the employment of Nigerien citizens.

ROTAB – Publish What You Pay Niger calls on the government to immediately publish the convention in the official Gazette, as required by the Nigerien constitution. The convention must respect the national Mining Code 2006 as well as the UEMOA Community Code. No contract can be above the law, especially relating to tax provisions. Transparency, via the publication of the contract, is fundamental to allow civil society to play its oversight role and ensure that natural resources will benefit to the socio-economic development of Niger.

The Nigerien government, which is currently revising its Mining Code, should use this as an opportunity to defend its interests, not only in financial terms, but also in contract transparency and rehabilitation of mining sites. To achieve better deals that will benefit the entire Nigerien population, it is key to allow civil society to take part in the creation of this new Mining Code.

It is time to remind Areva, and the French government, due to its 86% ownership of the company, that Niger, despite contributing to a third of France’s electricity, remains at the bottom of the Human Development Index. The 10 to 15 million Euro VAT and other taxes that Areva refuses to pay, arguing it would make its activities unprofitable, are a minimal loss for the company, but could be an important contribution to Niger’s annual budget. In fact, if Niger is the fourth largest producer of uranium, isn’t it time that the exploitation of this ore contributes to more than 6% of the country’s GDP?