The Fleeting Promise of Tanzania's Gold

There’s no electricity in the mortuary at Geita district hospital in northern Tanzania. That means there’s just a room full of bodies, decomposing in the warm and ripe air, waiting to be collected and buried. When I told this to a friend who works at the Touch Foundation, an NGO tasked with increasing the capacity of healthcare services in rural Africa, she told me it’s not uncommon for hospitals to have these kinds of problems. The electricity goes out in plenty of other parts of the country, and medical units are no exception.

There is one exception in Geita, and in many towns like it in Tanzania. The Geita Gold Mine, where the power never goes out. In this very poor town, there is a very rich mine.

When I spoke to Tanzanians around Geita, they brought this to my attention. “We expect the government hospital to be the best, but you see we have no water. It is a simple thing. In the gold mine there is full time electricity and water,” explained Mary, a resident of Geita.

Referring to the people of his community, paralegal Wambura Matiko said, “They live a very awkward life or hopeless life.” This was especially evident when I spoke to those living in tent camps in Geita after being displaced by the mine. According to residents, they were promised money and assistance in exchange for resettling so the mine could be built. This was back in 2007. As of 2013, they sit in small shacks in a community that resembles a refugee camp, demonstrably hungry but very welcoming.

The people who live inside the mine, many of whom hail from South Africa and the majority of whom are white, are nicely shielded from this sort of awkward hopelessness. They enjoy separate medical services, eat separate food, and rarely exit the air conditioned cocoon of the mine, except when they’re on leave and returning home.

Tanzania is the third largest gold producer in Africa, behind South Africa and Ghana. Between 2009 and 2012, major foreign gold mining companies earned nearly $7 billion. According to the current exchange rate against the US dollar, they paid the Tanzanian government a corporation tax amounting to around $280 million.

Given the profits extracted from the Tanzanian land by AngloGold Ashanti, which runs Geita Gold Mine (GGM), and other international corporations like them, residents say their grievances about the vast differences in living conditions are completely valid.

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Based on data released by the Tanzania Mineral Auditing Agency (TMAA), GGM is by far the most productive gold mine in the country, producing nearly 43 percent of the country's gold in 2012. When shown this information, Jack, a South African who works for a company that provides equipment to the mines, emailed, “Ja but what’s the government ownership percentage and what are the mines’ obligations to social upliftment, building roads, etc.”

He pointed out that the companies do spend money “giving back” to the communities with development projects, as well as what he sees as the inherent fact that in coming to the communities, there’s subsequent improvement in the economy. Like many sources I spoke to, Jack requested that his name be changed for fear of losing his job.

For example, AngloGold has contributed upwards of $10 million to a water implementation project and to the construction of the Nyankumbu Girls Secondary School. However, these investments pale in comparison to what’s being extracted from the community. Unequal exchanges in the mining sector between foreigners and Tanzanians happen all over the country, with rich land traded for small giveaways from foreign firms. Local outrage has resulted in violence.

"It is like a war every day,” explained a security guard who works for African Barrick Gold at the North Mara mine in Tanzania.

”Every day, villagers are invading the mine site, their intention is not to harm someone, but most of them, they enter with pangas [machetes] to protect themselves [if they're] chased by police," he said. There was a major riot in 2008 when hundreds of villagers entered the mines and were killed by security.

Violence stems from Tanzanian citizens fighting for gold they see as theirs, and an attempt to take supplies from the mines so they can work themselves. I talked to Amani, who lived in North Mara for about ten years, and now works at a hotel in Mwanza.

“Most of the resources comes from the area, but when you see the environment around North Mara, they don’t benefit from the gold being there. They don’t get much from it. And mostly this is causing chaos between the people and the investors living around the place,”  he explained. “What makes them violent is because they don’t get what they need.”

As an example, Amani offered Nymwaga Road, the main road in the district, which he said remains undeveloped and sometimes so muddy that it's impossible to use it. "People believe that when there is development, it must benefit the people around it in terms of the economy," he said. "But the road is still muddy and sometimes you can’t pass. So people get angry and say, 'you are not helping but you are taking our gold.'”

“People have been shot like animals,” Amani said. Mine employees have also been murdered, some because they “shagged the local women,” according to Nick, an expat in the mining industry. Expat folklore says one was beheaded.

Similar stories emerge from Geita as well. Frankly, it’s a depressing town, and the tension in the area is palpable. Problems arise not just from outright attempts at stealing gold or equipment needed to mine the gold, but also through “misunderstandings.” Because of safety concerns, it’s illegal to even pick up waste from the mines in Geita. Citizens are known to go through the discards looking for rocks to crush that might have bits of gold left in them. Security cracks down on that as well.

Last May, a 17-year-old in Geita was shot and killed for “trespassing.” When I asked AngloGold about this incident, the firm made sure to be clear the teenager was not a “child," as residents of Geita had taken to calling him a “primary school student."

I spoke to Jessica van Onselen, who managed AngloGold's public affairs and media for Africa at the firm's corporate office in Johannesburg (she recently left this position), and she said they’d heard of the incident and were very disturbed by it. She also emphasized that GGM outsources its security to a company named Group 4 Securicor (G4S) and the security officials involved in the incident were working for G4S, not for GGM.

According to Matiko, “you have to understand there is no earmarked place between GGM and the local area,” making delineating what constitutes trespassing blurry. When questioned about the clarity of the boundary, van Onselen acknowledged this is a problem GGM has faced, and one they are working on. She said they’d made a conscious decision to not build a fence but that the “marking with the rock and cement route could have been done better.”

*****

“I don’t like black people. I think they’re stupid and they smell funny,” said the aforementioned Nick, who requested his name be changed after he realized that his comments might be seen as offensive. He’s a project manager at Group Five, a mining construction and infrastructure company that operates in the region. It’s a hot night in Mwanza, Tanzania, and Nick is hosting a braai, the South African term for a barbeque. Nick’s house is lovely and, like the homes of most expats, is guarded by armed security.

The rent for the house and the staff is all covered by Group Five. According to Nick, the house costs $1,500 per month. The housekeeper cooks and cleans six days a week, and is paid less than $100 a month.

I’m writing and working for a startup in Mwanza, a gateway to many of the mining towns in Northern Tanzania. When I was between guest houses and suggested to Nick’s roommate Rohan that I pay their housekeeper about $40 to do my laundry for the month during my transition, he told me that was too much. “You can’t let them get spoiled," he said, before making a flattening gesture with his hand. “You have to keep them down.” Another time when I was driving in the Group Five truck with Rohan and Nick to a beach outside Mwanza, Nick joked about getting “10 points” for every Tanzanian he hit en route.

If these anecdotes of a white upperclass managing an underpaid and exploited African working class bring slavery or apartheid to mind, then you’re pretty much spot on. Just as the end product itself is a signifier of wealth, the mining industry is deeply class based.

“The mining industry has made some people very rich and some people very poor. I mean it’s made some people very poor,” explained Erica Schoenberger, a professor of geography and environmental engineering at Johns Hopkins University, whose book Nature and Social Power is coming out next year. “It is a history of unbelievable brutality.”

According to Schoenberger, the wages the miners were paid in the 1960s in South Africa under the apartheid regime were lower than the real wages they were paid in 1911. A lack of real wage growth creates—and maintains—a lower class.

The white expats employed by major international companies involved with mining would say this hierarchy, and the subsequent division by skin color, is simply a consequence of experience and ability. The frustration with “the blacks” and frequent racist commentary just comes from years of “managing them.”

“Your specialists are the white people. People that have been mining for 40 or 50 years who have the knowledge of how to get the max amount of gold out of the ore,” explained Nick. That experience also includes learning to use and maintain the expensive, cutting edge technology the companies bring in.

Others disagree that expats have an inherent skill advantage. Carolous Bujimu, from Mwanza, used to be a small scale miner, which involves using more handmade tools and less invasive equipment. In the beginning, he said, “the muzungus [Swahili for white people] had knowledge, and the few Tanzanians didn't have experience. When the muzungus came they had the experience.”

Now, "we Africans have as much knowledge as them, but then they prioritize muzungus," Bujimu said. "Nowadays Tanzanians are studying because the mining sector is big, so the people are reading. They are educated, but they are not doing [the mining].”

That’s not how Nick and many others see it, though. “There’s no point in sitting on a resource if you don’t know how to use it," he said. "If you don’t know how to do it, it’s not my fault, and if you want me to do it, you have to pay me."

People like Chris Rupia, who works at the Tanzania Investment Centre (TIC), a government entity, help facilitate these relationships and foreign investments. “We want to attract you to come here with your equipment,” he said. “They set up their business here and [if they go through TIC] they don’t pay anything.”

The idea is that after the international companies with the big machines start making money, Tanzania will profit. Rupia is handsome, well spoken and well educated. He attended university in Dar es Salaam, worked with the UN Peacekeeping Mission in Darfur, and was a manager at telecom giant Vodacom before deciding to be “patriotic and work for my country.” He joined TIC at the Mwanza office in 2011. Still, one look around shows that foreign investment has yet to translate into capital for most Tanzanians.

The Tanzanians I spoke to, from adults to teens, acknowledged the complex set of factors—including government corruption, technological and capital gaps, and a long history of disparity—that have created the current power structure in the gold economy. Many blame the government, whose handling of resource contracts has been misguided at best, far more than companies like AngloGold, Group Five and Barrick.

It's a valid object of blame, as Tanzania's government struggles with managing its gold resources effectively. The Revenue Watch Institute gave the government a "weak" rating on its Resource Governence Index, which calculates how safely, cleanly, and effectively a country utilizes its resources. While it received a higher grade for safety and quality concerns, RWI found that transparency and accountability are lacking, "with particularly low scores in government effectiveness and the rule of law. [Tanzania] scores poorly on corruption and accountability indicators."

And without accountability, the country's gold wealth hasn't trickled down to regular citizens, who can't find the capital to keep up with major mining operations, and the gap has become entrenched. “Anyone can pick up a shovel and get something to live on. One guy might need 10 grams a month to survive, but a corporation needs more to turn a profit,” said Nick. He laughed. “They don’t even have money for airtime, so where are they going to get money to build a mine?”

Schoenberger put it another way, saying, “The big companies need to valorize all that capital and they need to keep going.” The need for profit to keep up with these huge companies feeds into the system that keeps the foreign companies in power. Tanzanians dealing with problems stemming from the mines, whether it be poor contracts or environmental issues, face legal mazes with few results.

Michael Zephanialudigija was a farmer and cattle keeper until 2007, when his animals, looking for water, escaped from their corral during the dry season. They made their way to a mining area and drank water with cyanide in it. Twenty-three of them died.

“The water had the agents that were used for processing gold. Contaminated chemicals,” he explained. According to Zephanialudigija, GGM said it would reimburse him for the dead cattle. But after three years of no response, he took the matter to court. He claimed approximately $80 per cattle, and was eventually awarded 10 percent of that total sum—less than $200. He claimed that GGM refused to pay more because “it was my negligence, they said.” The case is currently in the high court in Mwanza.

*****

There's potential for locals to develop a smaller gold industry without outside investment. Currently, small scale mines are generally looked down on because of safety, environmental, and labor concerns, as highlighted by Peru's struggles with illegal gold mining. A report from Human Rights Watch released in August decries small-scale mining because of unsafe conditions and child labor.

But some advocates argue that better regulation could develop a cottage industry of small-scale mining. A report from the International Institute for Environment and Development states that “small-scale and artisanal mining—a sector that governments and development agencies often see as only as a problem—could be a source of sustainable livelihoods for millions of marginalised people.” That would require a regulatory sea change, but would be a first step towards Tanzanians putting their gold wealth to better use at home.

“If this industry was controlled better, these small scale mines would get foreign investments,” said Kai, a Mwanza-based trader. (He also requested that I changed his name for fear of losing his job.) In the meantime, he supports international mines as the best alternative, saying they bring schools, food programs and development. With small mines, he said, “You have one fat cat and everyone working in dangerous and dodgy conditions.”

It also might allow locals to exploit their country's gold wealth while bypassing corruption within the government and licensing problems. “[The people of North Mara] are angry because they see the government abandoned them," said the security guard I spoke to. "There were contracts. When [the village] signed the contracts with the companies, there was some argument that the companies should [fund development projects for] the villages, but they did not do it. Maybe a little, but not much.”

This a common problem. “Mine owners will tell locals whatever they need to to get access to the mines,” Nick acknowledged. The problem, according to him, is that the people writing and signing the contracts don’t know the reality and capacity on the ground.

Rupia traced this problem back to the late 90s, when Tanzania first began encouraging foreign investments and engagement with international mining companies. “We were not prepared in terms of policy,” he said.

Bujimu, the former small-scale miner, was working when these major deals between the government and the international companies started happening. He added that translation was a crucial issue in the logistics of mining deals. Though the official language of Tanzania is English, Swahili is significantly more widely spoken. English is not even used in primary school.

“Some of our government officials, they don’t have much knowledge to translate the contract,” Bujimu said. ”After signing, there is implementation, and then they say 'No, this is not right,' but the contract is for 100 years.” Van Onselen at AngloGold said that all contracts signed were in English and that she didn’t know of any Swahili versions.

For Nick, like many expat miners, the situation may not be perfect, but it is just. “They haven’t been done over, what were they doing before we came? They had goats and sheep and chickens and they were eating bananas. Then they move and they see muzungus are coming and making money and then they get angry. But what are they doing now? Goats and sheep and chickens and eating bananas. And they don’t think it’s fair.”

Chris Nthite, the media manager at AngloGold in Johannesburg, emailed me a follow up after our interview. In it, he assured me that AngloGold's mining efforts have a positive payback for communities. "We leave communities better off for having been there," he said.