Guinea’s September 5 coup sent shock waves through both West Africa and global commodities markets. Guinea is the world’s second largest producer of bauxite, the ore needed to produce aluminum, and has rich iron ore, gold, and diamond reserves. The coup raises three fundamental questions about the future of Guinea’s mining sector and whether Guineans will benefit from the country’s mineral wealth or continue to pay the price for its exploitation.
First is whether the new military government will use the lucrative revenue generated by mining to advance Guineans’ access to education, healthcare, and other fundamental human rights. The mining sector provided US$544 million to government coffers in 2018, more than 30 percent of the state budget.
After deposing President Alpha Condé, Guinea’s new military leader, Mamady Doumbouya, accused him of overseeing endemic corruption and failing to use mining profits to tackle widespread poverty.
Guinea’s last coup leader, Dadis Camara, also began with a strong anti-corruption message before his sudden downfall in 2009. But in 2017 his mining minister was convicted of taking millions in bribes in exchange for mining deals. Can this new military government do better?
Corruption is pervasive in Guinea, though Condé’s mining ministry did carry out reforms to strengthen management of mining revenue and in 2019 and 2020 started distributing mining sector profits to local governments for the first time. Guinea has also been a regular participant in the Extractive Industries Transparency Initiative (EITI), which requires governments to publish the revenue they receive from mining companies.
Doumbouya said the country will remain committed to the principles of transparency and good governance promoted by the EITI. But the EITI itself condemned Guinea’s coup, which it said could “undermine progress in democratic and accountable governance.”
The second question is whether mining companies’ treatment of the communities that live closest to their operations will improve.
Government officials and mining companies praise the impact of mining on jobs and the local economy but many communities say that mining is destroying their farmland, spoiling their water sources, and plunging them further into poverty.
Condé’s government did far too little to ensure that mining companies respect human rights. It allowed companies to operate without adequate environmental and social management plans and helped companies avoid public scrutiny by keeping many government and company audits of mining impacts confidential.
Guinea’s new government might be more willing to confront the powerful mining industry, with Doumbouya stating that “scrupulous respect for environmental and social norms by mining companies is essential.” But a prolonged transition to civilian rule risks further weakening the government ministries that oversee mining and delaying vital reforms, such as a planned regulation to set out how companies should compensate communities for lost land.
The third question is what will happen to future mining projects.
Both Condé’s government and the coup leaders have promised that Guinea will process more of its bauxite into alumina, an intermediate product needed for aluminum production, keeping more mining profits inside the country.
But alumina refineries risk causing additional environmental and human rights harm, including leakage of toxic red mud. Guinea’s largest mining company, La Société Minière de Boké (SMB), is also considering shipping coal from China to power its new refinery, which would both increase Guinea’s carbon emissions and release harmful air pollution.
The new military government has also indicated support for exploiting Guinea’s iron ore deposits, which include Simandou, a massive, high-grade deposit in a biodiverse rainforest. SMB holds the rights to half of Simandou, with the other half held by the global mining giant Rio Tinto and Chinalco, a state-backed Chinese company.
Guinea’s transitional government should closely scrutinize the three companies’ plans to develop Simandou, which also requires construction of a 650km (400-mile) railway. SMB’s rapid expansion in Guinea’s bauxite industry since 2015 has had destructive impacts on communities’ land and water sources, while Rio Tinto part owns a decades-old bauxite mine with its own troubling human rights record.
For both Simandou and other mining agreements signed under Condé, the new government should ensure the agreements, and the manner in which they were awarded, included adequate safeguards to combat corruption and ensure respect for rigorous human rights and environmental standards.
Mining companies have largely been unfazed by the coup. But for an industry that benefitted so much from the Condé government’s limited oversight and weak regulation, the transition creates both an increased risk of human rights abuses and an opportunity to improve, if government and industry are willing.