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Tracking Development - Rio Tinto - Qit Madagascar Minerals

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<strong>Tracking</strong> <strong>Development</strong><br />

A collection of QIT <strong>Madagascar</strong> <strong>Minerals</strong>’ (QMM) socioeconomic contributions


<strong>Tracking</strong> <strong>Development</strong><br />

A collection of QIT <strong>Madagascar</strong> <strong>Minerals</strong>’ (QMM) socioeconomic contributions


Executive summary.......................6<br />

Introduction..............................10<br />

A Partnership....................................10<br />

The Exploration & study Phase<br />

1986 - 2005<br />

A Unique Context.......................................14<br />

The Red Island...................................................14<br />

The Anosy Region..............................................16<br />

QMM at a Glance...............................................17<br />

REGIONAL PLANNING...................................18<br />

Background of the project............................18<br />

Public Consultations.......................................19<br />

Planning the Region’s <strong>Development</strong>...............21<br />

the Global <strong>Development</strong> Alliance...................22<br />

A Growth Pole...................................................22<br />

The Regional <strong>Development</strong> Committee...........23<br />

The Construction Phase<br />

2006 - 2009<br />

managing the impacts................................26<br />

stimulating local employment.........................27<br />

monitoring inflation and migration.................27<br />

Promoting healthy behaviour...........................28<br />

infrastructural change.........................30<br />

A Resettlement action plan.............................30<br />

A weir and the andrakaraka fishermen.............33


The production Phase<br />

2009 - present<br />

supporting a healthy community................36<br />

encouraging educational opportunities...38<br />

maximising the economic impact..................42<br />

ensuring sustainable development............46<br />

.<br />

managing natural resources......................54<br />

fostering good governance......................58<br />

The future<br />

Long-Term SUSTAINABILITY.................................62<br />

The flagship programmes: fagneva and pdi.............62<br />

A regional mining foundation....................................63<br />

The importance of stakeholder engagement..........64<br />

THE NEXT Mining ZONES......................................66<br />

Sainte LUCE and petriky...............................................66<br />

Conclusion..........................................................68<br />

Useful Abbreviations and Acronyms.........................69<br />

Sources.......................................................................70


The Production Phase<br />

executive summary<br />

QIT <strong>Madagascar</strong> <strong>Minerals</strong> (QMM), a joint venture between<br />

<strong>Rio</strong> <strong>Tinto</strong> (80 per cent) and the Government of <strong>Madagascar</strong><br />

(20 per cent), has been active in the Anosy region of<br />

southeastern <strong>Madagascar</strong> since 1986. An exceedingly poor<br />

and isolated area, the Anosy region is environmentally fragile<br />

and faces major social challenges. Given this context, QMM<br />

has made social and environmental action a central theme<br />

to good business policy. Recognising that any large project<br />

in an economically deprived area will have both positive and<br />

negative impacts, <strong>Rio</strong> <strong>Tinto</strong>, and QMM in particular, has made<br />

transparent, measurable commitments to ensure its actions<br />

generate a net positive improvement for local society and the<br />

environment. QMM is working to maintain its commitments<br />

over the next fifty years of expected production, as the<br />

company will be held accountable to these commitments.<br />

QMM understands it must fulfil its obligations to communities<br />

directly affected by the project, as well as ensure it contributes<br />

to the overall development of the region. However, it has never<br />

been QMM’s objective to become a regional development<br />

agency, as this role is politically inappropriate, unsustainable<br />

and ill suited to the capacities and experience of the company.<br />

While QMM is working to contribute to the sustainable social<br />

well being of the host region’s population, its main challenge<br />

is to manage expectations as to what the project can and<br />

cannot provide. Thus, QMM has also worked to establish clear<br />

boundaries regarding its commitments and responsibilities.<br />

This allows QMM to operate more productively and ensure<br />

its investments generate sustainable socioeconomic and<br />

environmental benefits for the Anosy region and <strong>Madagascar</strong>.<br />

This social narrative is written 25 years later to capture<br />

the history of QMM with regards to its efforts promoting<br />

sustainable development in the Anosy region. Although, in<br />

its brevity, this narrative cannot possibly embody everything<br />

that has taken place, nor the intricacies of <strong>Madagascar</strong>’s social<br />

context and QMM’s role in it, this piece captures the actions<br />

implemented, challenges encountered and progress made<br />

pertaining to socioeconomic development. Current initiatives,<br />

as well as future plans, are highlighted. Recognising QMM’s<br />

interventions have taken place in a context involving many<br />

different partners, this summary primarily focuses on QMM’s<br />

activities and its role in these activities.<br />

The QMM project is a mineral sand mining operation<br />

extracting ilmenite and zirsill (zircon mixed with sillimanite)<br />

from coastal plain sand located across three separate<br />

deposits near the city of Tolagnaro, commonly known as Fort<br />

Dauphin. <strong>Rio</strong> <strong>Tinto</strong>, a leading global mining group, undertook<br />

the first ilmenite exploration in the late 1980s. Realising the<br />

area’s mineral potential, QMM embarked on extensive social<br />

and environmental impact assessments (SEIAs). To learn<br />

from public dialogue and to explain the project through<br />

6


executive summary<br />

direct discourse, public consultations were widely held with<br />

interested and affected parties at the local, regional, national<br />

and international level beginning in 1998. Recognising<br />

sustainable socioeconomic and environmental benefits<br />

could flow from QMM investment only if it was part of a<br />

long-term regional development strategy, the project was<br />

designed to function as part of a multi-partnership effort<br />

involving government officials, civil society organisations,<br />

international donor agencies and the private sector. Special<br />

attention was paid to integrating the project in a regional<br />

development context. QMM sponsored a far-reaching Plan<br />

de Développement Régional (PDR, or Regional <strong>Development</strong><br />

Plan) and the Comité Régional de Développement (CRD,<br />

or Regional <strong>Development</strong> Committee) was formed to lead<br />

the planning process. Alliances were forged with key actors<br />

working in the region, including the United States Agency for<br />

International <strong>Development</strong> (USAID) and the World Bank.<br />

(see The Exploration & study Phase, p. 12-23.)<br />

In late 2006, the project entered its initial construction<br />

phase at the first mining site of Mandena. The first and<br />

single largest industrial development project ever carried<br />

out in <strong>Madagascar</strong>, investment totalled US$931 million, with<br />

US$675 million going towards mining infrastructures and<br />

US$256 million towards the establishment of the new Port<br />

of Ehoala. The construction phase spanned three years and<br />

brought about rapid and drastic change to the Anosy region.<br />

An unprecedented level of economic activity was generated,<br />

directly creating approximately 4,500 jobs, while indirectly<br />

inducing up to three times as many jobs. The sudden<br />

intensity in economic activity also caused inflation, especially<br />

evident in the price of housing and food commodities,<br />

which in turn impacted most heavily on the very poor.<br />

Measures were taken to mitigate impacts, including the<br />

supply management of rice, <strong>Madagascar</strong>’s staple crop, and<br />

price monitoring of other major commodities. Additionally,<br />

mass sensitisation and awareness campaigns were organised<br />

to convey prevention messages about HIV/AIDS. As some<br />

of the infrastructures necessitated the resettlement of local<br />

communities, a programme benefiting Persons Affected by<br />

the Project (PAPs) was implemented focusing on livelihood<br />

restoration and development. (See The Construction<br />

Phase, p. 24-33.)<br />

QMM’s investments are those of a socially responsible<br />

enterprise. Numerous initiatives encompassing health,<br />

education, economic empowerment, good governance,<br />

sustainable development and natural resource management<br />

are currently being carried out.<br />

Whether at the workplace or in the communities with<br />

which QMM is involved, activities involving health promotion<br />

are of paramount importance to the company. The fight<br />

against HIV/AIDS and sexually transmitted infections<br />

(STIs) has been a cornerstone of QMM’s interventions in<br />

the Fort Dauphin area. Condoms, as well as Information,<br />

Education and Communication (IEC) materials, are always<br />

readily accessible and available to employees across all sites.<br />

Wellness campaigns, in which volunteer peer educators<br />

sensitise target populations on key health issues such as<br />

HIV, STIs, malaria and diarrhoeal diseases, while distributing<br />

condoms, chlorine solution (Sur Eau) and mosquito nets,<br />

are frequently sponsored by QMM. Water wells and health<br />

centres have been installed and constructed in communities<br />

previously without these basic facilities. Acknowledging the<br />

importance of maternal and child health, QMM finances a<br />

mother and child health programme and is an active partner<br />

with the Ministry of Health in the biannual and nationwide<br />

Mother and Child Health Week. (See The Production<br />

Phase, Supporting a Healthy Community, p. 36-37.)<br />

7


executive summary<br />

Recognising the shortcomings of local educational facilities,<br />

QMM has funded the construction and rehabilitation of public<br />

schools in its neighbour communities. Offering scholarships<br />

and financing literacy programmes, many who never had the<br />

possibility to attend or complete school are being given a<br />

chance. To build people’s capacity so everyone has an equal<br />

opportunity to be involved in the project, a first-of-its-kind<br />

vocational and technical training centre was opened in<br />

2007. For students who wish to apply their studies through<br />

practical training, an apprenticeship programme commenced<br />

at Mandena in 2010. QMM invests in its employees and<br />

numerous technical and leadership trainings have taken place<br />

internally and externally, within the region, across <strong>Madagascar</strong><br />

and abroad. (See The Production Phase, Encouraging<br />

Educational Opportunities, p. 38-41.)<br />

Economic development, through the recruitment of local<br />

personnel, the construction of new infrastructure or the local<br />

procurement of goods and services, is essential for the Anosy<br />

region. QMM has adopted a hiring process intended to grant<br />

preference to local applicants. Over 90 per cent of current<br />

employees are Malagasy. In 2011, of the 652 total direct<br />

hires, 70 per cent were recruited from the region. For those<br />

who do not have a particular skill set or qualification, HIMO<br />

projects (Haute Intensité de Main d’Oeuvre or High Intensity<br />

Labour Projects) are being carried out, generating hundreds<br />

of jobs. To enable local businesses to continually develop<br />

technical and managerial skills, QMM participates in various<br />

support and capacity building sessions. As one of the primary<br />

obstacles to local participation in economic opportunities<br />

was the absence of microfinance, in 2007 the region’s first<br />

microfinance institution was established. In April 2010, QMM<br />

transferred its original 50 shares from the institution to three<br />

farmers’ associations for future development. Infrastructure,<br />

most notably the Port of Ehoala, but also roads, electricity and<br />

a potable water treatment plant, have been constructed and<br />

are operational. Access to this infrastructure is shared with<br />

the public. Situated as the principal structure for economic<br />

development in the region, <strong>Madagascar</strong>’s second largest<br />

port, the Port of Ehoala, offers opportunities for agricultural<br />

production and business development, while acting as a<br />

catalyst for investment in the region and country as a whole.<br />

(See The Production Phase, Maximising the Economic<br />

Impact, p. 42-45.)<br />

Sustainable development is a cornerstone of QMM’s<br />

approach to business. The company is committed to<br />

supporting activities that contribute to more prosperous<br />

communities. To improve local living standards and enhance<br />

livelihoods, QMM launched two flagship programmes<br />

with annual budgets totalling over US$1.5 million.<br />

The Programme de Développement Intégré (PDI, or<br />

Integrated <strong>Development</strong> Programme), managed jointly<br />

with government representatives, promotes incomegenerating<br />

activities, alleviating pressure on natural resources<br />

and improving income-levels of the population residing<br />

around mining and mining-related activities. Over 2,000<br />

participants across 33 villages in the rural communities<br />

bordering Mandena are currently involved in 17 projects<br />

including animal husbandry, vegetable cultivation, fisheries<br />

and handicraft production. The Fagneva programme, a fiveyear<br />

community plan with interventions in Fort Dauphin<br />

and its immediate surroundings, was launched in 2010.<br />

This collaborative effort with government representatives,<br />

community representatives, the private sector, NGOs<br />

(non-governmental organisations) and QMM includes six<br />

projects targeting governance, sports and culture, education,<br />

security, sanitation and economic development. (See The<br />

Production Phase, Ensuring Sustainable <strong>Development</strong>,<br />

p. 46-53.)<br />

8


executive summary<br />

To achieve a Net Positive Impact (NPI) on biodiversity,<br />

QMM has engaged in programmes including conservation,<br />

rehabilitation, restoration and natural resource management.<br />

Over 1.5 million trees have been cultivated in the region’s<br />

largest tree nursery at Mandena and replanted, providing<br />

a sustainable source of fuel for the local population and<br />

reducing pressure on remaining fragments of natural forest.<br />

To co-manage natural resources and conservation zones,<br />

the dina, a traditional and uniquely Malagasy social contract,<br />

has been established. Management committees have been<br />

formed by the communities, government and QMM in each<br />

of the mining sites to apply and enforce the dina. Recognising<br />

the importance of environmental education, especially for<br />

<strong>Madagascar</strong>’s future generations, QMM has planted green<br />

spaces around primary schools and distributed learning<br />

materials which communicate the importance of protecting<br />

<strong>Madagascar</strong>’s unique natural environment. (See The Production<br />

Phase, Managing Natural Resources, p. 54-57.)<br />

Since March 2009 <strong>Madagascar</strong> has experienced political<br />

instability. The socioeconomic repercussions have had<br />

wide-ranging impacts on the project and have complicated<br />

relationships with stakeholders, positioning QMM in a very<br />

different context than ever anticipated. Deutsche Gesellschaft<br />

für Internationale Zusammenarbeit (GIZ) and QMM have<br />

signed a partnership agreement and are working together to<br />

promote good governance and economic diversification in<br />

the communities living around mining activities. As stipulated<br />

in the Mining Code, royalties, taxes and dividends are being<br />

distributed at the national, regional and local level. GIZ and<br />

QMM are supporting the Extractive Industry’s Transparency<br />

Initiative (EITI), with capacities in participatory planning and<br />

budgeting being strengthened and public awareness about<br />

the importance of the EITI generated. (see The Production<br />

Phase, Fostering Good Governance, p. 58-59.)<br />

The QMM project is anticipated to span over 50 years,<br />

from operation to closure. QMM is investing for the longterm<br />

and remains committed to the region’s development<br />

and to the project delivering positive outcomes. QMM’s two<br />

flagship programmes, the PDI and the Fagneva programme,<br />

will continue to strengthen people’s livelihoods and promote<br />

socioeconomic development. To ensure sustainability of<br />

the programmes, QMM recommends the establishment<br />

of a regional mining foundation to capitalise on part of<br />

the royalties. Applied correctly, the foundation can be the<br />

principal vehicle to share the benefits derived from mineral<br />

production with communities and the means to work towards<br />

effective, balanced and equitable development in the Anosy<br />

region. Understanding the need to continue strengthening<br />

stakeholder engagement, a Conseil des Parties Prenantes<br />

(CPP, or Stakeholders Council) composed of government<br />

members, civil society and QMM, has been established as<br />

an important component in the recently developed Conflict<br />

Prevention Strategy. As the company’s profitability will<br />

depend on exploitation of all three orebodies, the next mining<br />

zones of Sainte Luce and Petriky will later be developed.<br />

QMM has had an active presence within these communities<br />

for many years and will continue to do so, explaining the<br />

project, preparing the population for the changes to come<br />

and building positive relations based on respect, trust and<br />

mutual understanding. (See The Future, p. 60-67.)<br />

The 230 hectare Mandena conservation zone<br />

shelters 414 plant species, 21 species of mammals,<br />

40 species of reptiles and 44 species of birds.<br />

9


The Production Phase<br />

introduction<br />

The QIT <strong>Madagascar</strong> <strong>Minerals</strong> (QMM) project is an<br />

undertaking that has spanned several decades, with the first<br />

activity beginning in the mid-1980s. Located in a fragile and<br />

declining physical, biological and social environment in the<br />

remote Anosy region of southeastern <strong>Madagascar</strong>, the project<br />

represents a large-scale and long-term investment in fixed<br />

capital. As the first extensive mining project in <strong>Madagascar</strong>,<br />

QMM is committed to setting a high standard of social and<br />

environmental stewardship and to maintaining this standard<br />

throughout the project. QMM has made measureable,<br />

transparent commitments to the population directly affected<br />

by the project, with initiatives aimed squarely at achieving<br />

sustainable development. QMM is further contributing to<br />

the region’s overall development. From the earliest onset of<br />

the project, QMM recognised sustainable socioeconomic and<br />

environmental benefits could flow from its investment only<br />

if it were firstly, part of a long-term regional development<br />

strategy and secondly, part of development efforts involving<br />

government, international donor agencies and civil society.<br />

Thus, QMM has sought to ensure and has given significant<br />

support to regional planning, local ownership of development<br />

efforts and increasing investment from donors.<br />

Understanding the significance of collective efforts to work<br />

towards shared development goals, QMM strives to create<br />

durable partnerships and sustainable relationships built<br />

on trust and mutual respect. Through risk assessments<br />

for local populations affected by construction and mining,<br />

social and environmental impact studies and mitigation and<br />

development measures to improve people’s livelihoods,<br />

QMM is invested in the long-term. Acting responsibly results<br />

in long-term business benefits, thus QMM strives to maintain<br />

a responsible and supportive work environment.<br />

As a <strong>Rio</strong> <strong>Tinto</strong> company, QMM has made a strategic<br />

commitment to sustainable development. QMM policy<br />

prescribes that its activities contribute constructively to the<br />

company’s global transition to sustainable development. In<br />

this social narrative, QMM’s commitment is explored through<br />

the many initiatives specifically targeted toward this goal.<br />

A Partnership<br />

QMM and Deutsche Gesellschaft für Internationale<br />

Zusammenarbeit (GIZ), a federally owned enterprise<br />

supporting the German government in achieving its objectives<br />

in the field of international cooperation for sustainable<br />

development, are working together to promote local good<br />

governance and economic diversification in the communities<br />

bordering mining activities in the Anosy region of <strong>Madagascar</strong>.<br />

GIZ, with its well-established country and international<br />

experience, and QMM have signed a partnership agreement.<br />

This publication has been made possible through GIZ and<br />

QMM’s partnership.<br />

10


Anosy is an exceedingly poor and isolated<br />

region of <strong>Madagascar</strong>.<br />

11


The exploration Phase<br />

Rice is <strong>Madagascar</strong>’s staple crop,<br />

eaten at almost every meal.<br />

12


The Exploration &<br />

Study Phase<br />

1986 - 2005<br />

A Unique Context<br />

The Red Island<br />

The Anosy Region<br />

QMM at a Glance<br />

Regional Planning<br />

Background of the Project<br />

Public Consultations<br />

Planning the Region’s <strong>Development</strong><br />

The Global <strong>Development</strong> Alliance<br />

A Growth Pole<br />

The Regional <strong>Development</strong> Committee<br />

13


The Production Phase<br />

a unique context<br />

The Red Island<br />

Located in the Indian Ocean, <strong>Madagascar</strong> is the fourth largest<br />

island in the world, after Greenland, New Guinea and Borneo.<br />

With a high, central plateau and thousands of kilometres<br />

of white, sandy beaches spanning its pristine coastline,<br />

<strong>Madagascar</strong> stretches 1,500 kilometres (km) north to south<br />

and 500km east to west. Eighteen ethnic groups makeup the<br />

current population of 22 million, and all inhabitants share the<br />

common language of Malagasy, spoken in various dialects 1 .<br />

biodiversity. Unique, rare, and in many cases endemic species<br />

of flora and fauna inhabit the island. However, it is one of<br />

the most threatened ecosystems on the planet. Only ten to<br />

15 per cent of <strong>Madagascar</strong>’s land mass is covered by forest<br />

and what remains continues to be cut down or burned at a<br />

high rate 4 . As a result of its rapid environmental degradation<br />

and high concentration of unique species, <strong>Madagascar</strong> is<br />

considered to be a global biodiversity “hotspot.”<br />

Despite its image as a tropical paradise, <strong>Madagascar</strong> is<br />

one of the poorest countries in the world, with an annual<br />

gross national income per capita of US$420 1 . Ranking 151<br />

out of 187 countries in the 2011 United Nations Human<br />

<strong>Development</strong> Index (HDI) 2 , 68 per cent of the population<br />

is estimated to live below the international poverty line of<br />

US$1.25 per day. Life expectancy is 61 years and the underfive<br />

mortality rate is 58 per 1,000 live births, with an infant<br />

mortality rate of 41 per 1,000 live births 3 .<br />

Due to its impoverished state, the majority of <strong>Madagascar</strong>’s<br />

population depend on natural resources for their daily survival.<br />

Cast adrift from the east coast of mainland Africa more<br />

than 140 million years ago and isolated from the rest of the<br />

world, <strong>Madagascar</strong>, a place unlike any other, has tremendous<br />

14


The Production Phase<br />

The city of Fort Dauphin is located<br />

on a short, narrow peninsula at the<br />

southeastern tip of <strong>Madagascar</strong>.<br />

15


The Production Phase<br />

The Anosy Region<br />

<strong>Madagascar</strong> is composed of 22 regions. The QMM project is<br />

located in the Anosy region of southeastern <strong>Madagascar</strong>, covering<br />

25,000 square kilometres. Two main ethnic groups, the Antanosy<br />

and Antandroy, makeup the population of approximately 550,000.<br />

The largest city and capital of Anosy, Tolagnaro, commonly referred<br />

to as Fort Dauphin, has a population of approximately 75,000.<br />

Once the most viable French settlement in <strong>Madagascar</strong>, Fort<br />

Dauphin is one of the least developed urban centres in the country.<br />

Far from the capital of Antananarivo and virtually inaccessible by<br />

land due to extremely poor roads, all socioeconomic indicators<br />

related to poverty are present. Very low school enrolment rates,<br />

limited access to health care and high rates of unemployment<br />

characterise the region. Physical infrastructure and social wellbeing<br />

in Anosy continue to decline and deteriorate in one of the<br />

poorest areas in an already impoverished country.<br />

Anosy is a wet region, with varied agricultural practices. The<br />

communes of Ampasy Nahampoana and Mandromondromotra<br />

border the first QMM mining site of Mandena, approximately<br />

10km from Fort Dauphin. Although no villages were located on<br />

the ilmenite deposit, approximately 15,000 people currently live<br />

within a few kilometres of the mining zone. The communes are<br />

primarily dependent on agriculture, producing and harvesting<br />

rice, fruit, vegetables and spices, while coastal communities rely<br />

mainly on fishing and lobstering. The surrounding forests have<br />

historically been a source of wood for construction, fuel and<br />

charcoal production. They are also home to medicinal plants<br />

and honey bees. Reeds (mahampy in Malagasy) harvested from<br />

wetlands are commonly used for weaving material for baskets,<br />

mats and other crafts. Zebu, domestic cattle with a fatty hump<br />

on their shoulders, are regularly found grazing around the<br />

deposit. The littoral forests where the mining zones are located<br />

are also a particularly threatened forest type, containing highly<br />

localised plant and animal species.<br />

16


The exploration & study Phase<br />

QMM At A Glance<br />

<strong>Rio</strong> <strong>Tinto</strong> is a leading global mining group, combining <strong>Rio</strong><br />

<strong>Tinto</strong> plc, a London listed public company, with headquarters<br />

in the United Kingdom, and <strong>Rio</strong> <strong>Tinto</strong> Limited, listed on<br />

the Australian Stock Exchange, with executive offices in<br />

Melbourne. The two companies are joined in a dual listed<br />

companies (DLC) structure as a single economic entity, called<br />

the <strong>Rio</strong> <strong>Tinto</strong> Group 7 . With several operating assets across<br />

the globe and Africa, QMM is one such venture. QMM is 80<br />

per cent owned by <strong>Rio</strong> <strong>Tinto</strong> and 20 per cent owned by the<br />

Government of <strong>Madagascar</strong>.<br />

The project, with a total lifespan of approximately 50 years,<br />

is a heavy mineral sand mining operation extracting ilmenite<br />

and zirsill (zircon mixed with sillimanite) from silica sand<br />

covering an area of 6,000 hectares (ha). Located in three<br />

blocks over a distance of approximately 60km parallel to the<br />

coast, current mining activity is taking place at the 2000ha<br />

Mandena site. Other deposits are found at Sainte Luce and<br />

Petriky. The deposits contain nearly 70 million tonnes of<br />

ilmenite. This quantity accounts for approximately ten per<br />

cent of the world’s deposits. The ilmenite contains 60 per<br />

cent titanium dioxide, making it higher quality than most<br />

other global sources. The minerals are shipped through the<br />

Port of Ehoala to <strong>Rio</strong> <strong>Tinto</strong>’s processing facilities in Canada.<br />

Once upgraded, the raw material produces a new 90 per<br />

cent titanium dioxide chloride slag, which is then sold to<br />

titanium pigment producers and used as a white finish in<br />

paints, plastics, paper and dyes 7 . <strong>Rio</strong> <strong>Tinto</strong> has invested in a<br />

long-life mine and profitability will depend on exploitation of<br />

all three orebodies.<br />

The Mandena mining complex includes a floating separation<br />

unit connected to a dredge, a mineral separation plant (MSP),<br />

a storeroom, a power plant and a weir.<br />

17


The Production Phase<br />

The exploration Phase<br />

Regional Planning<br />

“The aim has been to develop a project that will meet high environmental and social<br />

standards and to maintain the same high standards throughout the life of the project 8 .”<br />

Background of the project<br />

1950’s:<br />

1986:<br />

1990-1992:<br />

1998:<br />

2001:<br />

2003-2005:<br />

2005:<br />

The existence of mineralised sand deposits in south-eastern <strong>Madagascar</strong> is confirmed.<br />

Geological prospecting is initiated by <strong>Rio</strong> <strong>Tinto</strong>, focusing on Mandena, Sainte Luce and Petriky zones.<br />

Independent baseline social and environmental studies are commissioned.<br />

The Framework Agreement, ratified and enacted by the National Assembly of <strong>Madagascar</strong>, establishes<br />

the legal and fiscal framework of the project and defines the rights and obligations of the<br />

government and QMM, specifically regarding the Social and Environmental Impact Assessment (SEIA).<br />

The SEIA is submitted to the Government of <strong>Madagascar</strong>. Six months later, the environmental permit<br />

is granted to QMM.<br />

Feasibility reports are carried out to determine whether the context fosters a compatible<br />

investment climate.<br />

The decision to invest US$585 million in the construction of the mine, port and roads, with an<br />

expected lifespan of 50 years, is made by <strong>Rio</strong> <strong>Tinto</strong>.<br />

18


The exploration & study Phase<br />

Public Consultations<br />

To plan and develop the project, QMM took significant steps to<br />

learn from public dialogue. Public consultations were carried<br />

out with the local population, regional and national authorities,<br />

environmental non-governmental organisations (NGOs) and<br />

international development agencies. Such efforts were aimed<br />

at gathering essential knowledge and building constituency<br />

through a transparent and open process. The consultations<br />

were also an opportunity to explain the project through direct<br />

discourse at the village level and to clarify the changes to come.<br />

This was a daunting challenge, as people had no reference point<br />

to comprehend the transformation the mine would produce.<br />

Independent baseline social and environmental studies were<br />

carried out between 1990 and 1992. Interested and affected<br />

parties were extensively consulted at the local, regional and<br />

national level before the Social and Environmental Impact<br />

Public consultations were carried out extensively at the local level,<br />

with over 120 villages included in the process (Picture from 2000).<br />

Assessment (SEIA) study programme was initiated in 1998.<br />

Throughout the process, particular attention was given to<br />

populations presumed to be most impacted by the project.<br />

To prepare an inclusive and fully informed SEIA and define its<br />

terms of reference, which was submitted to the Government<br />

of <strong>Madagascar</strong> for acquisition of an environmental permit<br />

for Mandena, views, opinions and knowledge of the local<br />

population was gathered. The public consultations were a<br />

mechanism for permanent and open dialogue; a means to<br />

build trust and foster mutual respect, allowing involvement<br />

of all parties in the planning process. Conforming to social<br />

organisational structures common to <strong>Madagascar</strong> and<br />

allowing residents to express their views outside of formal<br />

public meetings, QMM ensured close proximity with<br />

interested populations within their environments, often<br />

eating, drinking and living in the villages. Question and answer<br />

sessions, in which communities could discuss their concerns,<br />

fears, expectations and hopes, were an integral element of the<br />

consultations. All individuals, women alike, were able to voice<br />

their opinions. Information obtained from the sessions was<br />

documented by staff working on the project and validated<br />

back to the community. Over 120 villages were included in<br />

the process, carried out in two rounds, through hundreds of<br />

hours of extensive fieldwork.<br />

A governmental entity, Le Commissariat Général pour le<br />

Développement Intégré du Sud (CGDIS), was established to<br />

lead the planning process in the region. Roles and responsibilities<br />

of all stakeholders, partners and QMM were noted and<br />

clarified. Obligations and commitments were established and<br />

clearly defined. Potential impacts, both positive and negative,<br />

were identified and explained and all stakeholders became<br />

involved in mitigation and maximisation measures.<br />

19


The exploration & study Phase<br />

The consultations enriched the SEIA study programme and<br />

the project development process. Traditional and practical<br />

knowledge impacted decisions and provided solutions during<br />

planning. Major components of the project were modified<br />

and redesigned due to information gathered during the<br />

consultations. For example, the originally envisaged location of<br />

the Port of Ehoala and haul roads were revised. Other design<br />

changes addressed many of the social and environmental<br />

concerns and enabled the project to become more<br />

compatible with the economic development aspirations of the<br />

region. National and international specialists were consulted<br />

concerning social and environmental aspects, with many<br />

NGOs included throughout the process.<br />

Expectations of the local population<br />

The population’s concerns, fears, expectations and hopes<br />

predominated the local consultations. Some expectations<br />

fell under QMM’s responsibility, while others were<br />

the responsibility of the government. For this reason,<br />

government officials collaborated with QMM throughout<br />

the process. When concerns were expressed, they were<br />

noted and addressed by the respective parties.<br />

The biggest challenge during the consultation process,<br />

which is ongoing, was to establish realistic expectations<br />

and to manage them effectively. No roadmap existed on<br />

how to achieve this under the social conditions prevailing<br />

in Anosy.<br />

The local population was primarily concerned with<br />

recruitment. The promise of jobs and the economic<br />

benefits QMM would bring to the region was widely<br />

acknowledged and well received. Whenever possible,<br />

residents requested QMM hire locally before recruiting<br />

outside of the region. QMM made repeated efforts to<br />

communicate a relatively small number of permanent<br />

jobs would be created (eg after the construction phase).<br />

In spite of these efforts, expectations have proved<br />

difficult to manage.<br />

The public consultations allowed all individuals to voice their<br />

opinions and participate in public dialogue (Picture from 2000).<br />

The improvement of health and educational resources,<br />

as well as infrastructure, most notably roads for opening<br />

up the region and generating opportunities for future<br />

growth, were also commonly voiced.<br />

20


The exploration & study Phase<br />

Planning the Region’s <strong>Development</strong><br />

Recognising the need to plan the development of the region<br />

in the context of a large mining project, the local prefect,<br />

other community leaders and QMM, with support from<br />

the World Bank, initiated a regional planning process in<br />

1999. The process gained the support of a wide range of<br />

stakeholders; local community members, government officials,<br />

donors, including the United States Agency for International<br />

<strong>Development</strong> (USAID), the European Union (EU) and<br />

the World Bank, local businesses and NGOs. The Comité<br />

Régional de Développement (CRD, or Regional <strong>Development</strong><br />

Committee) was elected to lead the planning process.<br />

The CRD functioned as a platform for dialogue between all<br />

stakeholders for the sustainable development of the Anosy<br />

region. The CRD established a structure and process to<br />

prepare the Plan de Développement Régional (PDR, or<br />

Regional <strong>Development</strong> Plan). The process covered all areas,<br />

economic, social, environment and infrastructure, and identified<br />

key commercial sectors intended to stimulate economic<br />

growth. The PDR evaluated two different scenarios; a first that<br />

would include the QMM project in development planning for<br />

the Anosy region and a second that would factor it out of the<br />

equation. Its conclusion considered QMM and its infrastructure,<br />

such as the Port of Ehoala, as the main engine for the vehicle of<br />

regional development. However, it was recognised the region<br />

and its partners must build the rest of the vehicle in order to<br />

establish a synergy between the mine and other economic<br />

sectors. Agriculture was identified as the base for long-term<br />

sustainable development of the region and as the most likely<br />

economic opportunity for subsistence and employment.<br />

Tourism, mining, fishing and lobstering were also pinpointed<br />

as planned economic activities to stimulate the economy and<br />

create jobs. Improved infrastructure was acknowledged as an<br />

important component needed to promote this growth.<br />

A goal of the CRD was to operate as locally as possible,<br />

with representation at the commune level across the region.<br />

Once the PDR established an economic vision at the macro<br />

level, this vision was to be implemented on the micro level,<br />

involving communes, developing small enterprises and<br />

allowing local achievements to shape the global goal. By<br />

developing the local market and incorporating it into larger<br />

investments, the PDR’s initiatives hoped to contribute to<br />

long-term development of the region.<br />

One of many Comité Régional de Développement (CRD, or Regional <strong>Development</strong> Committee) meetings held during the committee’s<br />

operating period (Picture from 2000).<br />

21


The exploration & study Phase<br />

The Global <strong>Development</strong> Alliance<br />

A Growth Pole<br />

In 2001, the Global <strong>Development</strong> Alliance (GDA) was<br />

launched, establishing a public-private alliance between USAID<br />

and QMM and contributing directly to the achievement of<br />

priorities outlined in the PDR. The USAID-QMM alliance<br />

set out to “address some of the root causes of poverty and<br />

environmental degradation in the region of Fort Dauphin, one<br />

of USAID’s priority eco-regions. The alliance also served to<br />

bridge economic growth and natural resources conservation and<br />

management.” Motivated by “the deep poverty of Malagasy<br />

people, especially in the region of Fort Dauphin, exacerbated<br />

by their vulnerability to recurrent natural disasters, continued<br />

food insecurity, and shortcomings in government management<br />

of social sector priorities,” USAID’s primary objective was<br />

to “manage <strong>Madagascar</strong>’s rich natural resources, notably its<br />

unique biodiversity, which is of immeasurable global importance,”<br />

while QMM’s primary objective was to “ensure the mining<br />

investment will serve as an economic engine for the region,<br />

while also contributing to the long-term resolution of social<br />

and environmental issues 9 .” QMM’s responsibilities included<br />

supporting regional stakeholders in validating and finalising the<br />

PDR and assisting communes in developing their communal<br />

development plans. To support local communities manage<br />

their natural resources, QMM agreed to help contribute to<br />

the sustainable supply of wood and alternative energy sources<br />

for the population. QMM also pledged to provide technical<br />

assistance to the regional HIV/STI Coordination Committee<br />

and guarantee Fort Dauphin’s use as a behavioural and<br />

surveillance site.<br />

The presence of QMM and the regional planning process<br />

initiated through the CRD enabled the Anosy region to<br />

become one of three Pôle Intégré de Croissance (PIC, or<br />

Integrated Growth Poles) in the World Bank programme<br />

beginning in 2005. The growth pole model linked public-private<br />

development investments in three areas of <strong>Madagascar</strong>, Fort<br />

Dauphin, Nosy Be and Antsirabe. The growth poles centred on<br />

mining, public infrastructure, tourism and industrial parks and<br />

were intended to have catalytic and demonstrative impacts on<br />

other regions of <strong>Madagascar</strong>. To open up the isolated Anosy<br />

region, facilitate growth in tourism and agribusiness and to<br />

catalyse private sector growth in the mining sector, the World<br />

Bank partially funded the construction of the Port of Ehoala,<br />

as well as contributed to road construction, capacity building<br />

and training programmes in Fort Dauphin. Additionally, the<br />

CRD and regional planning process, including the formation<br />

of the PDR, were heavily supported by the World Bank PIC<br />

programme.<br />

““The mining project had been designed to<br />

function as one part of a multi-partnership<br />

effort involving national, regional<br />

and local governments, international<br />

development and civil society organisations<br />

and the Regional <strong>Development</strong> Committee 10 .”<br />

QMM actively participated in regional development planning to avoid creating the isolated “enclaves” of<br />

development that had characterised so many extractive industry investments in developing countries 11 .<br />

”<br />

22


The exploration & study Phase<br />

The Regional <strong>Development</strong> Committee<br />

The CRD, composed mainly of members of civil society,<br />

was a key development actor in the Anosy region and an<br />

indispensable catalyst to the formulation of the Anosy regional<br />

development strategy and plan. Its broadly representative<br />

makeup granted it legitimacy. Its capacity to bring together<br />

community members to discuss issues, challenges, constraints,<br />

resource needs and priorities was an important factor in<br />

the selection of Fort Dauphin for a significant growth pole<br />

investment and a national development priority 10 .<br />

Unfortunately, the CRD has become virtually inactive. The<br />

departure of key members and the termination of direct<br />

funding from partners such as the World Bank, USAID, the<br />

EU and QMM had decreased the level of activity before the<br />

national political crisis. Practical activity ceased altogether with<br />

the onset of the crisis in March 2009. Without an effective<br />

CRD, the region has been left without a region-based, multistakeholder<br />

platform for the formulation of regional strategy<br />

and planning. However, within the last year efforts have been<br />

made to reassemble the CRD.<br />

““QMM paid special attention to<br />

inserting the project in a regional<br />

development context with the double<br />

objective of preparing the region to<br />

receive a large-scale investment while<br />

simultaneously creating synergies<br />

with other economic activities that<br />

could develop in parallel 8 .”<br />

”<br />

Today, the CRD has reverted to its initial composition,<br />

with volunteers from different entities gathering on an<br />

informal and voluntary basis. A small group, including QMM<br />

representatives, are formulating a plan for a restructured CRD,<br />

which will avoid previous heavy structure and transaction<br />

costs and function with greater flexibility and agility. The need<br />

for technical support, which previously existed under USAID<br />

and the World Bank PIC programme, is great. However, local<br />

groups are working together to define priority actions and<br />

create an action plan, proof there still exists a shared desire<br />

to reinvigorate a regional development platform for Anosy.<br />

23


The exploration Phase<br />

Logistics was a major challenge during the construction<br />

phase, with all material brought through Fort Dauphin’s<br />

decaying port before the Port of Ehoala was constructed.<br />

24


The construction Phase<br />

2006 - 2009<br />

managing the impacts<br />

Stimulating local employment<br />

monitoring inflation and migration<br />

Promoting healthy behaviour<br />

infrastructural change<br />

A Resettlement action plan<br />

A weir and the andrakaraka fishermen<br />

25


The Production Phase<br />

managing the impacts<br />

Construction of Mandena and additional mine-related<br />

infrastructure began in 2006. Spanning three years, a<br />

comparatively short period relative to the mine’s expected<br />

life, the construction phase brought about far-reaching change<br />

to the Anosy region. Thousands of jobs were generated for<br />

the local and national population, numerous trainings were<br />

conducted and capacities strengthened, all within a proper safety<br />

culture. However, the construction boom also prompted inmigration<br />

and inflation, while exacerbating regional inequalities<br />

and generating resentment. Problems and increased hardships<br />

were inevitable, yet mitigation measures and positive actions<br />

produced overall impacts much better than anticipated.<br />

“The QMM project was the first and<br />

largest single industrial development<br />

project ever carried out in <strong>Madagascar</strong>.<br />

The construction phase generated<br />

an unprecedented level of economic<br />

activity in the Anosy region, creating<br />

approximately 4,500 jobs and up to<br />

three times as many induced jobs.<br />

Infrastructure included:<br />

--<br />

The mining complex at Mandena<br />

--<br />

A power station and fuel deposit<br />

--<br />

A weir to ensure the availability of fresh<br />

water<br />

--<br />

A public utility port for shipping the<br />

ore, serving simultaneously as a public<br />

and multi-purpose port<br />

--<br />

A haul road linking the port and the<br />

mining site<br />

--<br />

Accommodation infrastructures for<br />

employees and their families<br />

Investments totalled US$931 million;<br />

US$675 million for the mining<br />

infrastructure and US$256 million for the<br />

port, with the World bank contributing<br />

US$35 million through the PIC Programme.<br />

26


The construction Phase<br />

stimulating Local Employment<br />

Although skilled positions were generally externally recruited,<br />

all unskilled or semi-skilled labour was recruited locally; of<br />

the 4,500 total jobs, 3,600 positions were filled by Malagasy<br />

people, of which 70 per cent were from the Anosy region.<br />

To prepare for the construction phase of the project, a<br />

qualitative aptitude test, the Dover test, was administered to<br />

interested local applicants. The test was conducted to screen<br />

and quantify available candidates above a certain threshold,<br />

assessing hand-eye coordination, short training time and<br />

retention of acquired skills over time. This enabled QMM to<br />

select the most suitable applicants and provide a pre-selected<br />

list of potential employees to contractors, ensuring effective<br />

and efficient local recruitment.<br />

A key challenge was the safety and training of employees,<br />

many of whom were farmers and fisherman who had<br />

never worked on a construction site before. This was done<br />

successfully, with over 14 months without a Lost Time Injury<br />

and the lowest All Industry Frequency Rate in the <strong>Rio</strong> <strong>Tinto</strong><br />

Group. As a result, the project was awarded the Chief Safety<br />

Award “in recognition of efforts taken to achieve outstanding<br />

safety performance and a sustaining safety culture.”<br />

Monitoring Inflation and Migration<br />

QMM is committed to mitigating any potential negative<br />

impacts its operations could have on the Anosy region.<br />

To manage inflation, QMM monitored the prices of major<br />

commodities in Fort Dauphin between 2005 and 2008<br />

through a contract with the Institut National de Statistique de<br />

<strong>Madagascar</strong> (INSTAT, or National Institute of Statistics). The<br />

changes in consumer prices in the region before and during<br />

construction were examined. Studies also compared prices in<br />

Fort Dauphin with those of other major cities in <strong>Madagascar</strong><br />

over a designated period of time. The data was then made<br />

available to partners and local NGOs. To improve the quality<br />

of information, QMM introduced a “mystery shopper”<br />

programme, whereby residents from Fort Dauphin’s poorest<br />

areas were given a small amount of shopping money once<br />

per week. Purchasing specific products from different<br />

markets, they reported the costs and kept the goods as<br />

compensation.<br />

Rice is the staple food and crop in <strong>Madagascar</strong>. During<br />

the lean season, typically from October to April, rice<br />

shortages have been recorded in Fort Dauphin. Recognising<br />

a population influx could have an effect on rice availability,<br />

QMM initiated a programme to stabilise the price of rice.<br />

Through meetings with stakeholders; affected households,<br />

local government members and regional authorities, a rice<br />

monopoly was discovered to exist in the region. QMM<br />

assembled and supported a group of local wholesalers and<br />

encouraged networking between the different entrepreneurs.<br />

Provisioning and logistical support was provided, including a<br />

storehouse. Working with a local bank, QMM supported<br />

the wholesalers in their microfinance initiatives and provided<br />

a letter of guarantee for the participants. As a result, the<br />

price of rice in the local markets fell by 15 per cent between<br />

January 2007 and January 2008.<br />

Despite numerous positive efforts undertaken, the price<br />

of certain staples and services, such as housing and many<br />

food products, inexorably climbed. This created tangible<br />

problems for those in the population who were not<br />

employed or indirectly benefiting from QMM, with the poor<br />

most heavily impacted. The influx of some available income<br />

also increased local inequality even as it benefited the many<br />

who were employed.<br />

27


The construction Phase<br />

Anticipating how a large project would attract people from<br />

other regions, QMM communicated extensively across<br />

<strong>Madagascar</strong> that priority would be given to local applicants.<br />

All semi-skilled and unskilled positions were filled locally.<br />

For positions initially recruited from outside the region,<br />

QMM sent a strong signal discouraging individuals to come<br />

to Fort Dauphin in hopes of finding employment. To track<br />

this movement, QMM supported the urban commune of<br />

Fort Dauphin in establishing a management system on<br />

migration flows.<br />

Promoting Healthy Behaviour<br />

With less than one per cent of the population estimated<br />

to be HIV positive, <strong>Madagascar</strong> continues to be one of<br />

the few low prevalence countries in sub-Saharan Africa.<br />

As a large company with thousands of employees, QMM<br />

acknowledges its important role in working to maintain, if<br />

not reduce, the country’s low HIV prevalence. Substantial<br />

investments have been made in programmes aimed at<br />

preventing HIV transmission and other sexually transmitted<br />

infections (STIs).<br />

A baseline study on knowledge, practices, perceptions and<br />

beliefs about STIs and HIV/AIDS was undertaken before<br />

construction commenced. The study functioned as a<br />

double framework for implementing the National Strategic<br />

Plan to Fight against AIDS for 2001 to 2005 and the actual<br />

contribution of QMM in the promotion and protection of<br />

its employees. As one of the most effective tools against<br />

HIV is knowledge of one’s own HIV status, awareness and<br />

voluntary counselling and testing campaigns (VCT) were<br />

organised on a number of occasions, ensuring all personnel<br />

an opportunity to take an HIV test.<br />

Great measures were taken to sensitise local populations.<br />

QMM partnered with local organisations, as well as<br />

Population Services International (PSI), the International HIV/<br />

AIDS Alliance, the Malagasy Ministry of Health, USAID and<br />

SantéNet to launch an extensive campaign informing people<br />

about risky behaviours and promoting condom use. Special<br />

interventions targeted specific groups, such as sex workers.<br />

Well before construction commenced, a formal Association of<br />

Sex Workers was created. With financing provided by QMM,<br />

the Association conducted its own study of local prostitution.<br />

It identified local women engaged in prostitution and worked<br />

with the women, providing awareness and prevention<br />

resources. The innovative initiative was very successful,<br />

with all new entrants into prostitution quickly identified and<br />

consulted by their peers.<br />

A mobile cinema, the Cinemobile, was purchased through a<br />

project implemented successfully by PSI and funded by QMM.<br />

Screening awareness materials pertaining to HIV/AIDS and<br />

educating audiences through films and music videos, the<br />

Cinemobile reached 6,000 individuals per month. In addition<br />

to movies, social theatre productions and cultural and social<br />

events were used to convey messages about HIV/AIDS.<br />

A health impact assessment (HIA) was carried out on<br />

behalf of QMM by International SOS focusing on the heath<br />

of all people living in communities which could be directly<br />

or indirectly affected by the project’s development. The<br />

focus of the HIA was on the final phase of construction<br />

activities and the early commissioning and operational<br />

phases. From the beginning of 2006 to the end of 2008,<br />

the assessment documented numerous health impacts facing<br />

the communities and proposed a variety of interventions to<br />

mitigate the potential impacts.<br />

28


Challenges on Site<br />

The development of a company the size of QMM<br />

within a region like Anosy presented major challenges,<br />

some of which were anticipated, while others could<br />

not have been foreseen. Despite the many years<br />

of planning and preparation, the local population<br />

was not always prepared for the dramatic changes<br />

brought about by the QMM project.<br />

QMM attempted to manage the unrealistic<br />

expectations that came with the announcement<br />

of the mine’s construction. Although aware of<br />

the local populations’ expectations of jobs, the<br />

scale of demand, especially after the construction<br />

phase ended and a large number of positions were<br />

eliminated, was overwhelming. Much of the local<br />

population, employed on short-term contracts, were<br />

dissatisfied when their positions were no longer<br />

needed. Many misunderstood the termination of<br />

contracts as firing. Local businesses that prospered<br />

during the height of construction, providing services<br />

such as hotel accommodation and vehicle rentals,<br />

saw their markets disappear after the large number<br />

of construction workers left.<br />

Nevertheless, employment goals set by the SEIA in<br />

2001 were far exceeded. For example, local and<br />

national construction workforce hired from 2006 to<br />

July 2008 was approximately 87 per cent of the total<br />

workforce, significantly surpassing the initial target of<br />

35 per cent 14 .<br />

29


The Production Phase<br />

The construction Phase<br />

infrastructural change<br />

A Resettlement Action Plan<br />

Resettlement was a significant issue for many people who<br />

lived in or near areas designated for QMM infrastructure. The<br />

construction of the Port of Ehoala, the operation of a quarry<br />

and the building of an access road required households to<br />

be resettled as close to their original homes as possible. The<br />

resettlement process was guided by a Resettlement Action<br />

Plan (RAP), prepared by the Government of <strong>Madagascar</strong><br />

under the World Bank assisted PIC programme. Throughout<br />

the process all possible measures were taken to minimise<br />

the number of people requiring resettlement and to ensure<br />

livelihoods of those impacted were protected to the<br />

maximum.<br />

To develop the RAP, a socioeconomic and sociocultural<br />

survey of households affected by land acquisition was<br />

commissioned. The Déclaration d’Utilité Publique (DUP, or<br />

Public Utility Declaration) established the legal and operating<br />

framework to compensate affected persons. It assigned<br />

decisions on the form and amount of compensation to the<br />

regional government and established QMM’s financial and<br />

related obligations. Ninety-five households were identified as<br />

being affected by the infrastructures and in need of relocation.<br />

The RAP designed a mechanism to ensure fair and timely<br />

compensation of all 498 Persons Affected by the Project<br />

(PAPs). Several committees, with representatives including<br />

local authorities, PIC, QMM and PAPs, were established to<br />

manage the various aspects of the programme. A Dispute<br />

Settlement Committee informed the PAPs of their rights,<br />

ensured transparency, assessed grievances and processed<br />

approved claims. A local Land Expropriation Committee<br />

received the grievances and claim documents, while a Field<br />

Verification Committee tested the grievances and verified<br />

the legitimacy of the claims. The NGO Cielo Terra was<br />

commissioned to represent the community; to ensure the<br />

PAPs voices were heard and their rights justly observed.<br />

The resettlement process has not been without challenges.<br />

The nature and amount of compensation, particularly for<br />

replacement land, has been problematic. Some affected<br />

persons preferred cash rather than in-kind compensation<br />

and used their compensation payments for consumption<br />

rather than investment. Many had no reference point to<br />

assist them deal with this new change in their lives. However,<br />

particular attention has been given to vulnerable groups,<br />

such as the least educated and very poor, in recognition that<br />

these populations are often the most adversely affected and<br />

the least equipped to benefit from the positive impacts of<br />

the project.<br />

30


The construction Phase<br />

A Handicraft Centre<br />

QMM has been funding sustainable livelihood and development projects<br />

as part of its obligation to affected populations (PAPs). Implemented<br />

by the NGO Cielo Terra, the projects ran from 2007 to 2011, and<br />

continue to operate under the Programme de Développement Intégré<br />

(PDI, or Integrated <strong>Development</strong> Programme). Activities take place<br />

at the Soaniavy Centre, known during the construction phase as<br />

the “Airport Village,” due to its proximity to Fort Dauphin’s airport.<br />

Housing contractors throughout the construction of the Port of Ehoala,<br />

the complex is now a first-of-its-kind training centre.<br />

Workshops in handicraft production are being offered. Through an<br />

initial six-month training course, followed by a trial period and refresher<br />

courses, women artisans have developed skills unmatched from the<br />

region in four different specialities; embroidery, sewing, weaving and<br />

braiding. Working mainly with natural materials found abundantly in the<br />

area, including raffia, sisal and mahampy, 190 women residing near the<br />

port and quarry have participated in these initiatives. Demonstrating<br />

steady quality improvement over the past four years, the products<br />

represent some of the finest craftwork in <strong>Madagascar</strong> and have been<br />

sold internationally in Italy and La Reunion. Over 21,000 pieces have<br />

been produced for a total income generation of 38 million Ariary<br />

(US$19,000).<br />

Participants, typically “mariners,” (wives of fishermen who fish from the<br />

sea and lake systems) can earn up to 125,000 Ariary (US$63) per month.<br />

With additional disposable income, changes are taking place across<br />

households. Cielo Terra’s director, Veronica Bevivino explains, “The<br />

beneficiaries are more empowered, more outspoken, make more frequent<br />

trips into Fort Dauphin and are more proactive in their communities 15 .”<br />

Nutrition standards and hygiene practices have also improved. Overall<br />

quality of life has increased, proof this fruitful opportunity is making a<br />

positive contribution in people’s lives.<br />

Participants earn at minimum<br />

40,000 Ariary (US$20) per<br />

month and can generate a<br />

monthly income up to 125,000<br />

Ariary (US$63).<br />

Mahampy reeds are harvested,<br />

dried, dyed and woven into<br />

placemats, table runners, wall<br />

hangings and baskets.<br />

Cielo Terra purchases embroidery<br />

and sewing supplies from<br />

Antananarivo for the production<br />

of tablecloths, pillowcases,<br />

curtains and other merchandise.<br />

31


32<br />

Motorised pirogues allow fishermen to reach new<br />

fishing areas up to 14 kilometres from Fort Dauphin.


The construction Phase<br />

Through close consultations with the affected communities<br />

and support from the government and the World Bank, most<br />

of the issues have been resolved. All claims for compensation<br />

have been investigated and 91.5 per cent of the claims have<br />

been settled. From the beginning, QMM stressed the objective<br />

of the resettlement programme was more than to simply<br />

provide cash or in-kind compensation for the loss of land or<br />

assets, but to ensure livelihoods were restored, if not improved.<br />

Livelihood restoration projects have since been implemented<br />

in collaboration with Cielo Terra, the regional government, the<br />

World Bank and QMM to increase literacy, improve fishing,<br />

aquaculture, agriculture and develop handicraft production.<br />

Community health initiatives have also been implemented<br />

and infrastructure built, including wells, latrines, a community<br />

drugstore, a basic health centre and a training centre.<br />

A Weir and the Andrakaraka Fishermen<br />

Part of the infrastructure included the construction of a weir in<br />

the lagoons downstream from lake Ambavarano. During the<br />

extraction and separation of minerals from sand, fresh water<br />

is used. The weir was built to prevent salt-water intrusion<br />

into the lagoon system, from where water is pumped to the<br />

mineral separation plant (MSP). This infrastructure also allows<br />

future restoration efforts to take place, as salt water cannot be<br />

used for replanted forests and fuel-wood plantations.<br />

The Ambavarano lake and lagoon system is important in the<br />

daily lives of surrounding communities, who fish from the lake<br />

and use the water system to access the ocean. To identify<br />

users and stakeholders, define issues and impacts and develop<br />

a management plan and communication strategy, an impact<br />

assessment was undertaken with the various stakeholders.<br />

To accommodate local fishing boats and tourist vessels, a lock<br />

was built as per suggestions from stakeholders’.<br />

The weir has been a point of dispute for some stakeholders.<br />

The new infrastructure has been perceived to restrict<br />

movement, while contributing to diminished fish intake.<br />

To investigate these grievances, extensive surveys were<br />

commissioned. Studies tracked and recorded species variety<br />

and quantity and the lagoon system users. Restricting the<br />

natural flow of water, the weir changed the lake and lagoon<br />

ecosystem from a brackish ecosystem to a freshwater<br />

ecosystem, which has in turn influenced the aquatic species<br />

living in the system. Certain species thrive, while others<br />

decline in the new freshwater system. The surveys also<br />

discovered fishermen increased by three-fold during the<br />

study period, which has contributed to overfishing.<br />

Measures were established to mitigate many of the weir’s<br />

impacts. To strengthen technical capacities and enhance<br />

intake, theoretical and practical training was offered to users.<br />

New regulation fishing nets were distributed, as the previous<br />

use of small mesh nets contributed to reduced fish numbers<br />

and environmental damage. Microfilament rope, weighing<br />

scales and traps were provided. Fibreglass pirogues and<br />

motors were supplied, with trainings conducted on motor<br />

maintenance and use. An association of fishermen from<br />

Andrakaraka, FIMIRA, was formed to manage the lagoon<br />

system. Eighty-four lake and sea fishermen benefited from<br />

the initial project.<br />

Transition to sustainable fishing practices has not been easy,<br />

particularly the use of large mesh nets and initial neglect of<br />

women’s roles in marketing the fish. However, continuing<br />

dialogue with the fishermen and an increase in fish stocks are<br />

addressing the remaining points of dispute. The Programme<br />

de Développement Intégré (PDI, or Integrated <strong>Development</strong><br />

Programme) is currently being implemented to mitigate impacts<br />

of the weir and ensure the affected population continues to<br />

receive support.<br />

33


The Production Phase<br />

New fishing materials, techniques and<br />

practices have been introduced which are<br />

less environmentally destructive and generate<br />

improved yields.<br />

34


The production Phase<br />

2009 - present<br />

supporting a healthy community<br />

encouraging educational opportunities<br />

maximising the economic impact<br />

ensuring sustainable development<br />

managing natural resources<br />

Fostering good governance<br />

35


The Production Phase<br />

supporting a healthy community<br />

Good health is a key component to a happy life. Whether at<br />

Mandena or in the communities in which QMM is involved,<br />

activities involving health promotion are paramount for the<br />

company. QMM prioritises a Safe and healthy workplace.<br />

With the goal of zero occupational illness and injury for<br />

employees and their families, activities involve continuous<br />

monitoring of different contaminants, including dust, noise and<br />

radiation. Between 2010 and 2011, over 1,650 employees<br />

underwent medical examinations. As the fight against HIV/<br />

AIDS and STIs has been a cornerstone of QMM’s activities in<br />

the Fort Dauphin area, condoms are always readily accessible<br />

and available to employees across all sites, with over thirtytwo<br />

thousand condoms distributed to date. The provision of<br />

Information, Education and Communication (IEC) materials<br />

and the regular distribution of impregnated mosquito nets<br />

and sodium hypochlorite solution (Sur Eau) for point of use<br />

treatment of drinking water is routine, with 6,000 bottles<br />

distributed in 2011.<br />

QMM strives to contribute to the advancement of<br />

public health in the region and to promote community<br />

health in communities surrounding the project. In Sainte<br />

Luce and Ambinanibe, where the population previously<br />

lacked easy access to a health centre, QMM financed<br />

the construction of a CSB (Centre de Santé de Base -<br />

primary health care centre). In the communes of Ampasy<br />

Nahamponana and Mandromodromotra, where health<br />

centres existed but were in need of repair, QMM funded<br />

their rehabilitation. Previously, health staff working across<br />

the two communes commuted over an hour between<br />

Fort Dauphin and their respective CSB’s. Through QMM<br />

support, two housing complexes for doctors, nurses and<br />

other health staff have been built. This has generated more<br />

time for consultations, contributing to more productive<br />

and efficient health care.<br />

To provide communities with improved access to clean<br />

drinking water, QMM financed the installation of 20 water<br />

wells. Residents no longer have to travel long distances<br />

36


The Production Phase<br />

on foot to access potable water. The water wells also<br />

help reduce the incidence of waterborne diseases.<br />

In collaboration with the Ministry of Health and partners<br />

such as the United Nations Children’s Fund (UNICEF),<br />

QMM supports the biannual and nationwide Mother<br />

and Child Health week. By supplying transportation,<br />

vaccinations, nutritional supplementation and other<br />

supplies, staff and materials are able to travel to the<br />

eight communes in which QMM is working. QMM has<br />

identified populations previously unable to participate<br />

in the events due to their remote location. Once a<br />

month, since 2005, health staff access these isolated<br />

populations and provide essential health services.<br />

A maternal and child health programme, implemented<br />

in collaboration with the CSB in Ambinanibe, involves the<br />

establishment of a health and management committee<br />

composed of 60 mothers. Community health agents, along with<br />

committee members, have undergone training on the main highrisk<br />

and prevalent diseases. They are active in their communities,<br />

taking part in vaccination campaigns, the regular follow-up of<br />

undernourished children and monitoring of pregnant and<br />

breast-feeding women. QMM continues to sponsor wellness<br />

campaigns in which volunteer peer educators, “wellness<br />

champions,” sensitise target populations on key health issues<br />

such as HIV, STIs, malaria and diarrhoeal diseases. They are<br />

also involved in the mass distribution of condoms, disinfectant<br />

solution (Sur Eau) and impregnated mosquito nets.<br />

Community health agents regularly provide consultations on high-risk and prevalent diseases within the communities they work.<br />

37


The Production Phase<br />

encouraging educational opportunities<br />

It is QMM’s aim to strengthen local populations’ capacities,<br />

enabling everyone the same opportunity to be involved<br />

in the project. The shortcomings noticed at the level of<br />

education and qualification in Fort Dauphin motivated<br />

QMM to establish partnerships from the beginning of<br />

the project, promoting education and training of local<br />

populations.<br />

training has taken place within the region, across<br />

<strong>Madagascar</strong> and abroad, primarily in South Africa and<br />

Canada. Two hundred and fifty QMM employees have<br />

travelled to South Africa for technical training at Richards Bay<br />

<strong>Minerals</strong> (RBM). Leadership trainings for QMM managers<br />

were also conducted in South Africa. Superintendents<br />

working for the company travelled to Canada and eighty<br />

employees participated in technical and robotics training in<br />

Fort Dauphin, with trainers flown in from abroad.<br />

Through a joint partnership between the Ministry of<br />

Education, the region of Anosy, the World Bank PIC<br />

programme, UNDP and QMM, the Centre Regional de<br />

Formation professionnelle et De technique d’anosy<br />

(CRFPTA, or Anosy Vocational and Technical Training<br />

Centre), a first-of-its-kind institute in the region, opened in<br />

November 2007. Collaborating with the Alliance Française<br />

for language courses, CRFPTA offers modules in computer<br />

science, accounting, electrical engineering and industrial<br />

mechanics. For students who wish to put their studies into<br />

practice, an apprenticeship programme, providing additional<br />

practical training, commenced in 2010 at Mandena. A group<br />

of 20 apprentices have been awarded scholarships for<br />

their yearlong studies in industrial production, mechanics,<br />

electricity and mineralogical laboratories. Some of the<br />

apprentices will continue to work at QMM, while others<br />

will enrich the skills’ pool of the region.<br />

The establishment of QMM has introduced professionals<br />

with new skills and expertise to the region. QMM<br />

employees frequently provide technical support, advice and<br />

experience sharing in the community outside of work hours,<br />

participating on steering committees, as board members and<br />

leaders in community projects. For example, at the CRFPTA<br />

training centre, QMM employees perform functions of fulltime<br />

board members, providing technical support, assisting<br />

in instructor searches and budget management.<br />

QMM has funded the construction and rehabilitation of<br />

public schools in its neighbouring communities. To date,<br />

ten primary schools have been built with QMM support,<br />

with US$2.6 million invested in education initiatives before<br />

Mandena was built. Essential learning materials have been<br />

donated, such as desks, chairs, lockers, books, notebooks and<br />

38


The Production Phase<br />

chalkboards. Teacher housing near the schools has been<br />

provided, as previous conditions required teaching staff<br />

to travel long distances for their work. A school canteen<br />

programme, in partnership with the National Office for<br />

Nutrition (ONN) is also in operation and aims to increase<br />

nutritional intake and generate higher attendance rates.<br />

Realising the lack of secondary education in the region, QMM<br />

carried out feasibility studies to open a secondary school of<br />

quality in Fort Dauphin. A partnership was formed with a<br />

private institution from Antananarivo, the Clairefontaine<br />

School, which opened in 2008.<br />

Since 2004, QMM has awarded scholarships annually to<br />

enable graduates to pursue superior technical education in<br />

the capital of Antananarivo or at other tertiary institutions<br />

in <strong>Madagascar</strong>. To date, 60 students have been recipients of<br />

these scholarships. In 2010, eight scholarships were awarded<br />

to graduates to pursue higher education in maintenance and<br />

laboratory studies. Scholarships are also offered to children<br />

from regional communities to attend the Clairefontaine<br />

School. With good grades and proof of financial need, QMM<br />

subsidises up to 40 per cent of educational costs Radio<br />

announcements, television advertisements and brochures<br />

publicise this valuable opportunity.<br />

A primary school in the village of Andrakaraka and an ASAMA (Asa Sekoly Avotra Malagasy) literacy school in the background,<br />

both examples of QMM’s educational initatives.<br />

39


The Production Phase<br />

The programmes follow the national educational curriculum<br />

and instructors are trained through UNDP in Antananarivo<br />

and Fort Dauphin. Once students complete the tenmonth<br />

ASAMA programme, they take the nationwide CPE<br />

(Certificate of Primary Education) exam to enter into<br />

secondary school. There are five ASAMA programmes<br />

currently operating in the communities surrounding the project<br />

area. Previous ASAMA graduates from the programmes first<br />

class are presently in their fourth year of secondary school.<br />

This outcome demonstrates the programme’s success<br />

and confirms children who once might not have had the<br />

opportunity to learn are succeeding in their studies.<br />

QMM is involved in literacy programmes, providing<br />

educational opportunities to those who formerly did<br />

not have the chance. The programmes, developed in<br />

collaboration with the University of Fianarantsoa, the United<br />

Nations Educational, Scientific, and Cultural Organization<br />

(UNESCO), UNDP, and implemented by the NGO Cielo<br />

Terra, have been operating since 2006.<br />

Five years of primary school are taught across 13 months<br />

through the Planète des Alpha and ASAMA (Asa Sekoly<br />

Avotra Malagasy) programmes. Youth ages 11 to 17, who for<br />

various reasons did not previously attend or complete primary<br />

school, first participate in the Planète des Alpha programme.<br />

After a three-month intensive reading and writing course,<br />

students who successfully pass a final exam continue onto<br />

the ASAMA programme. Currently 50 students are enrolled<br />

in the programme.<br />

Acknowledging the importance of proper nutrition, QMM<br />

subsidises a school lunch programme for Planète des Alpha<br />

and ASAMA. Students are served meat and seafood dishes,<br />

as well as fresh, seasonal fruit and vegetables. Snacks are also<br />

provided twice per day. QMM constructed the school buildings<br />

and provides pens, notebooks, books, desks and chairs. The<br />

Planète des Alpha and ASAMA programmes operate in close<br />

cooperation with the public school in Fort Dauphin, to ensure<br />

a strong partnership and the students smooth transition into<br />

secondary school. The Regional Directorate of National<br />

Education officially validates the certificates issued to the<br />

students. QMM is further assisting students participating in<br />

the literacy programmes to attend secondary school through<br />

scholarships and by subsidising school fees.<br />

The AFID (Alphabetisation Fonctionelle Intensive pour le<br />

Développement) programme is an adult literacy programme<br />

operating at two sites, the Soaniavy Centre specifically targeting<br />

artisans and women involved in the programme for handicraft<br />

production and in Ampasy Nahampona commune. Each session<br />

runs for six months, with literacy and math courses offered.<br />

40


The Production Phase<br />

A second chance<br />

According to UNICEF, for every 100 Malagasy children who<br />

enter grade one, only 60 will complete the full five-year<br />

primary school cycle. The average Malagasy adult finishes<br />

only 4.4 years of school. This is because <strong>Madagascar</strong> does<br />

not have enough trained teachers and enough classrooms<br />

or schools 16 .<br />

The Planète des Alpha and ASAMA (Asa Sekoly Avotra<br />

Malagasy) sister programmes are unique in both their<br />

duration and teaching styles. Using practical teaching<br />

methods different from typical instruction common across<br />

Malagasy public and private schools, the programmes<br />

emphasise logic building and make learning as relevant as<br />

possible. Recognisable examples, in which students can<br />

relate to and associate with, are frequently used. Addition<br />

problems are presented with props; eg oranges are used<br />

when counting. The alphabet has been renamed and each<br />

letter corresponds to a phonetically similar sounding word;<br />

Rabesosasosa (snake) for S and Rafofofofo (wind) for F.<br />

Active participation is key with games, images, drawing and<br />

theatre frequently used. All subjects are also conducted in<br />

Malagasy. French language is taught as a separate subject.<br />

These pilot programmes, which have demonstrated positive<br />

results, may be the solution to education in a poor country<br />

such as <strong>Madagascar</strong>. While working out the specifics in the<br />

communities surrounding Mandena, perhaps this teaching style<br />

will be developed into a model and applied throughout the<br />

Anosy region, which encompasses one of the most illiterate<br />

populations in the nation.<br />

ASAMA students outside<br />

their school building in<br />

Mandromondromotra.<br />

A Malagasy storybook<br />

produced by UNDP hangs<br />

in the classroom.<br />

Planète des Alpha students<br />

from Ampasy Nahampoana<br />

participate in an exercise<br />

to practice the alphabet.<br />

41


The Production Phase<br />

maximising the economic impact<br />

The presence of QMM has generated significant economic<br />

opportunities for <strong>Madagascar</strong> in general and the Anosy<br />

region in particular. To attain long-term sustainable<br />

development in the Anosy region, QMM recognised from its<br />

earliest examination of the project the need to require the<br />

stimulation of broad-based economic activities extending far<br />

beyond its own project. Explicitly, the danger of the mine<br />

becoming an enclave industry was acknowledged. Thus,<br />

QMM has and continues to encourage the development of<br />

a “parallel economy.” To contribute to the development of<br />

this economy, QMM has invested in the region by sourcing<br />

products, services and much of its workforce locally, enabling<br />

a positive business environment and financing additional nonmine<br />

related infrastructure.<br />

Strengthening economic opportunities for local populations<br />

is an important goal of QMM’s. From its inception, QMM<br />

adopted a hiring process intended to grant preference to<br />

local applicants. Recruitment is handled through a “Guichet<br />

Unique,” administered by the Ministry of Employment. Lowlevel<br />

posts are advertised solely in Fort Dauphin and highlevel<br />

posts in both Fort Dauphin and Antananarivo. Over 90<br />

per cent of current employees are Malagasy, with 15 per cent<br />

being women. In 2011, of the 652 total direct hire QMM<br />

employees, 5 per cent were expatriate hires, 70 per cent local<br />

hires and 25 per cent Malagasy from other regions.<br />

To develop a positive and enabling business environment for<br />

small and medium sized enterprises, QMM has participated<br />

in various support and capacity building projects with local<br />

businesses. Initiatives include technical training and English<br />

and business management support courses. The objective<br />

is to enable entrepreneurs and businesses to comply with<br />

the standards required by QMM, allowing the company to<br />

procure goods and services locally. In 2011, QMM<br />

spent approximately US$94 million on procurement, with 40<br />

per cent going to local suppliers. Local and national suppliers,<br />

837 of whom have worked with QMM, are complied in a<br />

company database. New service providers are continuously<br />

responding to tenders published by the company. These<br />

include opportunities for housekeeping, cleaning, gardening,<br />

guarding, accommodation and catering. QMM activities<br />

have also generated business opportunities for nationally<br />

registered companies, which have opened branches in Fort<br />

Dauphin, including Henry Fraise & Fils, SICAM, Orange, Telma,<br />

Total, Jovenna and Colas.<br />

The generally low level of economic activity in the region and<br />

QMM’s position as one of the few investors in Fort Dauphin<br />

has generated some discontent among local suppliers. Many<br />

face insecurity generated by short-term contracting and are<br />

understandably pressing for a greater share of procurement.<br />

QMM is working to improve dialogue with local businesses<br />

42


The Production Phase<br />

and engage them in joint initiatives to promote local<br />

procurement and employment.<br />

To assist local residents generate income employment<br />

while acquiring specific skill sets, over one hundred HMO<br />

Projects (Haute Intensité de Main d’Oeuvre, or High<br />

Intensity Labour) have been implemented. Requiring no<br />

particular qualifications, HIMO projects have taken place<br />

surrounding Mandena and other mine-related infrastructure,<br />

as well as in Fort Dauphin. Projects include the rehabilitation<br />

of footpaths, street cleaning, garbage removal and sanitation<br />

activities, as well as reforestation, gardening, digging firebreaks<br />

and constructing soccer fields. To date, 2,200 individuals<br />

from some of the poorest households have taken part in<br />

these activities, providing income of about 40 million Ariary<br />

(approximately US$20,000).<br />

An analysis of the regional context has highlighted the difficulty<br />

in accessing credit as a major obstacle in business/enterprise<br />

development. A feasibility study for the establishment of a<br />

regional microfinance institution was initiated in 2005<br />

by the Association Internationale de Crédit Agricole et<br />

Rural (ICAR, or the International Association of Agricultural<br />

and Rural Credit) with the support of QMM and UNDP.<br />

The regions first financing institution, Institution Financière<br />

Régionale d’Anosy (IFRA, or the Regional Financial Institution<br />

of Anosy), financed by the Government of <strong>Madagascar</strong> and<br />

QMM, was established in 2007. Providing loans through<br />

microfinance in Fort Dauphin with the goal of increasing<br />

productive capacity, by December 2011 the IFRA had 316<br />

clients.<br />

In April 2010, QMM transferred its original 50 IFRA shares<br />

to three farmers’ associations for a total value of 16 million<br />

Ariary (approximately US$8,000). As these associations<br />

include populations affected by the relocation process, the<br />

transfer falls within the scope of support activities targeting<br />

relocated populations surrounding the quarry and Port of<br />

Ehoala.<br />

QMM is involved in sponsoring activities, including cultural,<br />

sporting and social events. In 2011 alone, sponsoring of<br />

these events reached over 50 million Ariary (approximately<br />

US$23,000).<br />

Numerous site visits have been organized for local small<br />

and medium sized enterprises to explore potential business<br />

opportunities offered by QMM and the Port of Ehoala.<br />

As part of the required infrastructure and the company’s<br />

contribution to the region’s economic development,<br />

QMM, with World Bank support, built a public-private<br />

deepwater port on the Ehoala peninsula. The Port<br />

43


The Production Phase<br />

of Ehoala, <strong>Madagascar</strong>’s second largest port, opened<br />

to the public on July 8, 2009. Offering opportunities for<br />

agricultural production and business development through<br />

the provision of an import and export channel, the port<br />

acts as a catalyst for investment in the region and country<br />

as a whole. Supporting the impoverished Anosy region,<br />

which historically has remained relatively isolated, the port<br />

now exports all the region’s formal sector products; frozen<br />

fish and lobsters, scrap iron, sisal, mica, fruit and ilmenite.<br />

In addition, commercial cruise liners carrying up to 1,000<br />

tourists dock for day trips into Fort Dauphin, bringing an<br />

increase in tourist income to the region. To date, over 340<br />

ships of all categories have utilised the new port, which<br />

has also handled thousands of containers. Many of these<br />

have contained rice and humanitarian aid for emergency<br />

assistance.<br />

plant, which includes a sewage collection system, was<br />

designed and constructed. With a combined estimated<br />

cost of US$4 million, the rehabilitated plant and new<br />

plant sufficiently meet the water needs of the urban<br />

population.<br />

QMM purchased and installed a generator for the city<br />

to have a reliable source of electricity. QMM provides<br />

maintenance of the facilities and supplies heavy fuel,<br />

which JIRAMA purchases. The provision of electricity to<br />

Fort Dauphin has huge value to the morale of the city’s<br />

population.<br />

The current major obstacle to the full use of the Port of<br />

Ehoala is the near-impassable state of RN 13, the road out<br />

of Fort Dauphin. Road infrastructure within the immediate<br />

region and connections to other parts of the island is very<br />

poor, which affects terrestrial transfer of goods, mainly to<br />

and from the capital Antananarivo. QMM constructed and<br />

improved several roads in the surrounding area for the<br />

operation of the mine. Road development was one of the<br />

initiatives under the World Bank PIC programme, which<br />

was suspended following the political crisis, but has recently<br />

been reinitiated. Rehabilitated roads will help reduce the<br />

Anosy region as an enclave and increase exports of its<br />

lucrative commodities.<br />

QMM, with the government and local utility company<br />

JIRAMA, rehabilitated the city’s existing and very old<br />

potable water treatment plant. Additionally, a new<br />

The first cruise ship, MSC Sinfonia, docked at the Port of<br />

Ehoala in March 2010.<br />

44


The Production Phase<br />

The Port of Ehoala, a multi-purpose public<br />

utility port, is <strong>Madagascar</strong>’s second largest.<br />

45


The Production Phase<br />

ensuring sustainable development<br />

“Sustainable development is not a programme independent from QMM, it is rather an<br />

approach underpinning the whole company’s activities 17 .”<br />

Ny Fanja Rakotomalala, President of QMM<br />

QMM acknowledges the three main sources of success for<br />

the company are access to land, people and capital. To sustain<br />

access to these essentials, QMM devotes great attention and<br />

resources to protecting the environment, ensuring management<br />

systems and social policies are well established and contributing<br />

to the economic prosperity of local communities.<br />

QMM’s pledge to sustainable development has evolved from<br />

two frameworks, The way we work and the PDR. The way we<br />

work contains <strong>Rio</strong> <strong>Tinto</strong>’s global statement of business practices<br />

and outlines the principles and standards of behaviour, which<br />

guide QMM in its commitment to social responsibility. The<br />

PDR serves as a reference in the development of external<br />

intervention strategies specific to the Anosy region.<br />

In 2009, QMM created a Directorate comprised of the<br />

departments of Biodiversity, Community Relations and<br />

Sustainable <strong>Development</strong>. A team of 97 employees work<br />

collaboratively everyday towards sustainable development in<br />

the Anosy region.<br />

A Socioeconomic Baseline Study<br />

Towards the end of construction, with data gathered<br />

in 2008 and a final report submitted in 2009, a<br />

socioeconomic baseline study was conducted in the<br />

communities surrounding Mandena. With the purpose<br />

of gathering baseline data before the start of any<br />

programmes, the study evaluated living conditions<br />

in Ampasy Nahampoana and Mandromondromotra<br />

communes. Basic indicators were defined. Access to<br />

basic infrastructure (water points, health centres and<br />

schools), the current state of such infrastructure, the<br />

income level of the population, sources of income,<br />

means for household production, as well as the general<br />

situation in terms of health, education, employment,<br />

public safety, food security and recreation and sports,<br />

were detailed. The study was carried out in the<br />

framework of the Programme de Développement<br />

Intégré (PDI, or Integrated <strong>Development</strong> Programme).<br />

46


The Production Phase<br />

To Improve local living standards and<br />

enhance household livelihoods of<br />

communities bordering mandena and<br />

living in fort dauphin, two flagship<br />

programmes were launched.<br />

executing agencies<br />

Operating in a consortium of five Agents d’Exécution<br />

(AGEX, or executing agencies), these QMM partners<br />

bring their individual skills and expertise to the PDI<br />

by implementing the projects with the communities.<br />

• Agrivet: A national veterinary company implementing<br />

beekeeping and poultry production activities.<br />

• ASOS (Action Socio-Sanitaire et Organisation<br />

Secours): A Malagasy NGO specialised in health,<br />

sanitation and rural development and implementing<br />

vegetable cultivation activities.<br />

• Manoa Company: A local company implementing<br />

sustainable fisheries and eel production activities.<br />

• FAFAFI (Fanentanana Fambolena sy Fiompiana):<br />

A faith-based Malagasy NGO specialised in agricultural<br />

development, implementing pig farming and rice<br />

production activities.<br />

• Cielo Terra: A local NGO implementing handicraft<br />

production, sea fishing, lake tourism, literacy<br />

programmes and community health activities.<br />

The Programme de Développement Intégré (PDI, or<br />

Integrated <strong>Development</strong> Programme), initiated in 2009<br />

with a projected time frame of three years and an annual<br />

budget of US$ one million, targets rural communities<br />

bordering Mandena, primarily residing in the communes of<br />

Ampasy Nahampoana and Mandromondromotra, as well as<br />

communities in the Fort Dauphin area and surrounding the<br />

Port of Ehoala. Jointly managed by QMM and government<br />

representatives, the programme is intended to be a timelimited<br />

contribution to the sustainable development of the<br />

region beyond specific contractual obligations. The PDI aims<br />

to improve living standards and conditions of the population<br />

directly affected by the project, with an overall objective of<br />

minimising any adverse impacts the mining operation might<br />

have on the community and environment while maximising<br />

the positive benefits.<br />

From the programme’s launch, a participatory approach<br />

was adopted to determine the needs and problems of the<br />

target population, which the PDI has worked to address and<br />

improve. Priorities originated from the communities, with<br />

three key areas of intervention determined; the construction<br />

of infrastructure, training and education and incomegenerating<br />

activities (IGA).<br />

Currently, 33 villages and 2,000 people are directly benefiting<br />

from the PDI. A major strategy adopted by QMM is the<br />

promotion of IGA to alleviate pressure on natural resources<br />

and to improve income levels of the local population. To<br />

date, 17 IGA projects working towards building sustainable<br />

livelihoods have been identified and are in operation. As<br />

grassroots undertakings, these projects have the ability<br />

to produce tangible results in the short-term but are<br />

envisioned to operate for the long-term. Projects include<br />

animal husbandry, agriculture, sustainable fishing and honey<br />

production (for a complete list see page 48).<br />

47


The Production Phase<br />

Income generating activities<br />

--<br />

Bee keeping and honey production<br />

--<br />

Sustainable Fisheries and sea and lake<br />

fishing techniques<br />

--<br />

Animal Husbandry, including poultry<br />

and pig farming<br />

--<br />

Eel breeding<br />

--<br />

Agriculture, including vegetable and<br />

Rice cultivation and cash crop<br />

production<br />

--<br />

Small-Scale food processing, including<br />

the Transformation of fruits and<br />

vegetables<br />

--<br />

Handicraft manufacturing, including<br />

embroidery, sewing, Sisal and Rafia<br />

weaving and mahampy braiding<br />

--<br />

Composting and earthworm culturing<br />

--<br />

barge and Fiberglass boat<br />

manufacturing<br />

--<br />

Brick making<br />

--<br />

Small tool manufacturing and wood<br />

workshops<br />

Other initiatives<br />

--<br />

Literacy Programs<br />

--<br />

Ecotourism<br />

--<br />

community Health and Sanitation<br />

48


The Production Phase<br />

A Vegetable Garden<br />

In 2010, the NGO ASOS began implementing a vegetable<br />

cultivation project in the communities of Ampasy<br />

Nahampoana, Mandromodromotra and Andrakaraka.<br />

Almost 200 participants were involved in the first year’s<br />

harvest. Today, the project has expanded across six sites.<br />

Vegetables, including carrots, cabbage, radishes and eggplant,<br />

are currently being grown on 4ha by 250 participants. Each<br />

participant generates a yearly revenue of approximately<br />

300,000 Ariary (US$150) from the sale of these products in<br />

the communities where they are grown and in Fort Dauphin.<br />

ASOS provides technical training in planting and cultivating<br />

techniques and the proper establishment and maintenance of<br />

a garden, while distributing supplies, including seeds, watering<br />

cans, wheelbarrows and shovels. Participants are currently<br />

undergoing training in insecticide spraying and treatment,<br />

as well as acquiring skills in composting. The continual<br />

reinforcement of participants capacities is key to the success<br />

of the programme and refresher courses are frequent.<br />

Seeds were not previously produced in the Anosy region.<br />

Instead, those originating from Antananarivo and Fianarantsoa<br />

are supplied by local vendors. Acknowledging the demand, the<br />

project has begun to supply locally furnished seeds. Recently<br />

established gardens have been planted with seeds produced<br />

during last year’s harvest. Seed production is envisioned<br />

to continue, with the project supplying and selling seeds in<br />

surrounding communities and Fort Dauphin. Kiosks, in which<br />

participants can sell their products in Fort Dauphin and in<br />

QMM’s housing complexes, are also planned for the future.<br />

Public radio advertisements<br />

publicise this initiative every<br />

Thursday evening.<br />

A fair to showcase products<br />

was held in Ampasy<br />

Nahampoana in 2010. In 2011,<br />

this event expanded to Fort<br />

Dauphin.<br />

Each participant uses their<br />

individual plot of land for the<br />

production of vegetables.<br />

Participants engage in<br />

insecticide treatment training<br />

courses.<br />

49


The Production Phase<br />

A Piggery<br />

Eighteen piggeries have been established in the communities<br />

bordering Mandena, with over 550 pigs inhabiting the new<br />

infrastructures. A new pig breed originating from Antsirabe<br />

has been introduced to the region. Outweighing the local<br />

variety by 50 to 100 kilos, the combined piggeries house 162<br />

breeding pigs and have produced 395 piglets thus far.<br />

The NGO FAFAFI has been implementing the animal<br />

husbandry project since March 2010. With 141 participants,<br />

the project’s first production took place in August 2010.<br />

During the initial phase of the project, pigs less than four<br />

months old were sold to supply other piggeries with their<br />

first stock. Each piglet fetched a price between 80,000 to<br />

100,000 Ariary (US$ 40 to 50). From every sale, 30 to 40<br />

per cent of the total revenue is placed in a revolving fund;<br />

participants keep the rest. The piggeries and fund are<br />

managed by an association of participants. Each participant<br />

takes responsibility for his or her pigs, caring for them, cleaning<br />

and providing food. Theoretical and practical trainings, as well<br />

as vaccinations, have been conducted by FAFAFI technicians.<br />

As the project is entering its second phase, technicians are<br />

supporting participants identify future sows. Pig waste is<br />

currently being used in a new composting project and a<br />

biogas project is envisaged for the future. Technicians are<br />

also assisting in crossbreeding the two pig races. The new<br />

variety, once fully grown, will sell for a much higher price and<br />

produce more meat, which is sold in local markets and across<br />

Fort Dauphin.<br />

Community members interested in raising and breeding pigs are<br />

encouraged to join the project.<br />

The newly constructed piggery in Analambendrana houses nine<br />

sows and benefits eight community members.<br />

50


The Production Phase<br />

A confectionary<br />

Thirty men and women from Ampasy Nahampoana<br />

and Mandromondromotra have undergone training<br />

and are currently earning an income through small scale<br />

food processing. Bananas, raspberries, guavas, litchis and<br />

other produce are being transformed into jams, jellies<br />

and marmalades. Since January 2011, over 700 jars have<br />

been produced. The locally made products are sold to<br />

restaurants and individuals across Fort Dauphin. Sodexo,<br />

the catering company supplying much of QMM’s food,<br />

purchases 60kg per month alone.<br />

The confectionary houses new and contemporary<br />

appliances and utensils and is up to the highest sanitary<br />

standards. The NGO Cielo Terra implements the project,<br />

provides training and supplies many of the materials.<br />

The project has begun to market trial a “petite boulangerie”<br />

or small bakery, in which local commodities are being<br />

experimented with to prepare cakes and snacks. Manioc, an<br />

abundant food source in the region, is being used outside of its<br />

traditional form to make donuts, sambos and fish cakes. These<br />

goods are sold in the communes in which they are produced.<br />

As participants continue to develop their skills, future initiatives<br />

include producing fresh juices, candies from natural fruit base,<br />

fruit snacks, and canning vegetables. This undertaking, new to<br />

the region and population, not only generates an income for<br />

participants, but also has introduced high quality and unique<br />

products for local markets.<br />

Participants from Ampasy Nahampoana are learning new<br />

techniques they can introduce to their communities.<br />

Cielo Terra covers the cost of labelling and product marketing.<br />

51


The Production Phase<br />

“You give us your hand for the good of Anosy”<br />

is the slogan of the Fagneva Programme, literally meaning<br />

“flagship.” A five-year community programme initiated by<br />

QMM in July 2010, the Fagneva programme is a collaborative<br />

effort with government representatives, community<br />

representatives, the private sector, NGOs and other<br />

development actors in the region. The programme has been<br />

developed as part of QMM’s voluntary contribution to the<br />

sustainable development of Fort Dauphin and is based on<br />

regional objectives defined in the PDR. It is aligned with other<br />

planning documents, such as the Plan d’Urbanism Directeur<br />

de Fort Dauphin (PUDi, or Urban Plan of Fort Dauphin) and<br />

the Plan Communal de Développement (PCD, or Communal<br />

<strong>Development</strong> Plan). The programme’s conception is based<br />

on three elements; clear sharing of responsibilities, effective<br />

partnerships and sustainable actions.<br />

The Fagneva programme includes six projects targeting<br />

governance, sports and culture, education, public security and<br />

road safety, economic development and sanitation (See page<br />

53 for details). Projects are updated and renewed yearly,<br />

with interventions taking place in the eleven districts of Fort<br />

Dauphin and its immediate surroundings.<br />

Although QMM currently finances the projects, to secure<br />

their sustainability, partners, authorities, the community and<br />

QMM are working together to allow part of the royalties and<br />

taxes generated from the mining operations to be allocated<br />

to projects implemented under the Fagneva programme.<br />

Current partners are undertaking lobbying activities to<br />

rebuild the alliance for the development of Fort Dauphin and<br />

the region, through the CRD and the PDR. The credibility of<br />

such an alliance will depend to a large extent on the success<br />

of the Fagneva programme.<br />

52


The Production Phase<br />

Fagnina (governance)<br />

Vasia (education)<br />

Tolagnaro Milamy (public security<br />

and road safety)<br />

Residents of Mandromondromotra<br />

commune take part in a participatory<br />

budget training session. Other activities<br />

include strengthening the PDR.<br />

Students from 2010’s apprenticeship<br />

programme. Other activities include<br />

awarding scholarships, improving school<br />

infrastructure and upgrading teacher’s<br />

skills.<br />

A ceremony in which nine motorcycles<br />

and one 4x4 were donated to the<br />

national police/gendarmes. Other<br />

activities include reinforcing security in<br />

Fort Dauphin, road safety and a fire<br />

brigade project.<br />

Fagnoitsy (economy)<br />

Fihamy (sports and culture)<br />

Tolagnaro Marevaky (sanitation and<br />

enhancement of Fort Dauphin)<br />

A community member showcases locally<br />

produced vegetable products routinely<br />

sold in fair’s across Fort Dauphin.<br />

Other activities include the provision of<br />

water and electricity and support of the<br />

tourist industry.<br />

Fort Dauphin’s first half-marathon was<br />

organised in 2010. Other activities include<br />

initiating a school soccer programme,<br />

training referees for club sport teams<br />

and planting new grass at Fort<br />

Dauphin’s Ampasimasay stadium.<br />

An HIMO group improves the main road<br />

in Fort Dauphin. Other activities include<br />

building 11 wells and storage units for<br />

clean water, as well as the construction<br />

of a slaughterhouse and showroom.<br />

53


The Production Phase<br />

managing natural resources<br />

The littoral forests in which the three deposits are located<br />

are a particularly threatened forest type, containing highly<br />

localised plant and animal species. QMM’s goal since the<br />

beginning of the project has been to protect the unique<br />

biodiversity of the area and to achieve a net positive<br />

impact (NPI) on biodiversity. To ensure this biodiversity is<br />

preserved, for nearly 20 years QMM has worked on different<br />

programmes including conservation, rehabilitation of land after<br />

mining, restoration of natural ecosystems and the sustainable<br />

utilisation and management of local natural resources.<br />

Flora and fauna species have also been exceptionally well<br />

identified though QMM sponsored research. Recognition of<br />

these efforts was demonstrated in 2009 when QMM was<br />

awarded the esteemed Nedbank Green Mining Award in<br />

the environmental category. The award honours a company<br />

that has made a significant effort in terms of protecting or<br />

improving the biophysical environment in which it operates.<br />

Seventy permanent and more than 100 non-permanent<br />

employees, 80 per cent of whom are from the communities<br />

bordering Mandena, work for the biodiversity programme.<br />

Established in 2002, the Community Reforestation<br />

Programme’s objective is to plant 100ha of fast growing trees<br />

per year to supply local communities with wood for fuel and<br />

charcoal around the mining sites. In addition, a regional tree<br />

nursery was established in 2005, in partnership with USAID,<br />

to provide a sustainable source of fuel for the population<br />

and to reduce pressure on natural forest remnants. To date,<br />

more than 1000ha have been reforested with approximately<br />

1.5 million trees.<br />

QMM has been using “green engineering” to stabilise<br />

infrastructure around the project and haul roads. The<br />

production of 2.5 million Vetiver (Vetivera zizanioides), a<br />

non-invasive species known for its high capacity to combat<br />

erosion, created hundreds of jobs and generated hundreds<br />

of dollars of net income for local populations during the<br />

construction phase. This activity continues to sustain local<br />

agricultural associations today.<br />

Mahampy (Lepironia mucronata) is a reed species growing<br />

in the wetlands of Mandena and across the region. The<br />

reed, known as mahampy in the local Malagasy dialect, is an<br />

indispensable resource for the local population. Harvested<br />

and used to make various types of basketry through braiding<br />

and weaving, mahampy represents a substantial economic<br />

and cultural component within the Anosy region.<br />

The first trials to restore the mahampy reed were<br />

conducted in 1999 with the help of women’s associations.<br />

Fifty women from villages surrounding Mandena were<br />

actively involved and integrated in the experiment. Despite<br />

initial scepticism expressed by participants with respect to<br />

the viability of rehabilitating the mahampy reed beds, after the<br />

first harvest of exceptional quality mahampy, the association<br />

thrived and presently includes 186 women.<br />

54


The Production Phase<br />

Mahampy<br />

Marie Agnes is one of seven women serving on the Comité de<br />

Gestion de Mandena (COGEMA, or Mandena Management<br />

Committee). She has been a member of the Mandena<br />

COGEMA since 2004, when the committee entered its<br />

second phase of operation. From Mandromondromotra, she<br />

is a link between QMM and the commune. Regularly found<br />

in QMM’s Biodiversity, Community Relations and Sustainable<br />

<strong>Development</strong> department, Marie Agnes collaborates with<br />

team members and provides information to and from the<br />

department to the communities bordering Mandena. She<br />

explains, “The communities living near Mandena believed it was<br />

because of the mine there was no more mahampy growing.<br />

However, we are explaining it is because of the Niaouli, an<br />

invasive species, (Melaleuca quinquinera or Kinina Bonaky in<br />

Malagasy) that the nutrients are being taken from the soil, so the<br />

mahampy can’t grow.”<br />

“There IS lots of mahampy and with<br />

restoration projects there will be even<br />

more. We know income from mahampy<br />

will always be here.”<br />

For Marie Angnes, and many others from the Anosy region,<br />

mahampy, a fast-growing reed found abundantly in swamps<br />

and low-water lakes, has played an important role in her life<br />

since she was a small child. “Even after a cyclone, mahampy<br />

is still here. It is always here as a source of income.” The mahampy<br />

reeds are dried, dyed and woven into baskets, hats<br />

and mats and sold acaross local markets and in Fort Dauphin.<br />

Mother’s teach their daughters this artistry and these skills<br />

are passed from one generation to the next.<br />

Through current mahampy restoration efforts, QMM is<br />

ensuring the reed species, exceptionally valuable to the local<br />

population, will continue to thrive in the region.<br />

Marie Agnes and Vola Silina during the mahampy restoration<br />

efforts in April, 2011.<br />

55


The Production Phase<br />

government under certain well-defined conditions. In 2002,<br />

QMM established a dina agreement to co-manage natural<br />

resources and conservation zones at the Mandena mining<br />

site, which presently covers 2,300ha. The Sainte Luce dina<br />

was signed in January 2006 and covers 19,000ha of land, 11<br />

fokontany and three municipalities.<br />

In Mandena, Sainte Luce and Petriky, the dina is applied and<br />

enforced by their respective Management Committees; the<br />

Comité de Gestion de Mandena (COGEMA, or Mandena<br />

Management Committee), the Association of Managers of<br />

Forests of Ambatoatsinana (FIMPIA) and the Association of<br />

Managers of Forests of Petriky (FIMPIAP). Each committee<br />

is composed of the Water and Forest District office of Fort<br />

Dauphin, the rural municipalities involved and QMM.<br />

Reciprocity and shared responsibility<br />

are hallmarks of the dina and of QMM’s<br />

approach to land use agreements.<br />

Twelve years later and building off of previous experience,<br />

the latest restoration project is currently taking place near<br />

the Mandena mining infrastructure. The goal is to restore<br />

4ha at this site. Forty people per day, comprised of three<br />

groups from the villages of Enandrano, Enato and Mangaiky,<br />

which border Mandena, are working to meet this goal.<br />

The Dina is a traditional and uniquely Malagasy social<br />

contract, designed to manage potential sources of social<br />

conflict and known to local populations for generations.<br />

Initially structured as unwritten law, based on the<br />

observance of traditional customs and taking the form of<br />

mutual understanding, today, the dina is recognised by the<br />

The PAGS are communicated by the Management Committees<br />

to the community through theater preformances.<br />

56


The Production Phase<br />

In addition to managing and implementing the dina,<br />

the Management Committees are responsible for the<br />

development and communication of the PAGS to the<br />

communities. The Plan d’Aménagement et de Gestion<br />

Simplifié de Mandena (PAGS, or Simplified Mandena<br />

Management and <strong>Development</strong> Plan) make the dina a<br />

physical reality. These “plans” or maps explain the terrain and<br />

detail its important features; the conservation zones, areas in<br />

which natural resources can be gathered, sacred sites (such<br />

as tombs and burial grounds) and areas where mining activity<br />

is restricted. As the mine moves, the PAGS are updated<br />

with the Management Committees and presented to the<br />

community for validation.<br />

“Children need to know the importance<br />

of endemic species, that they are unique<br />

to this area and are not found in other<br />

places.”<br />

(QMM Biodiversity department employee)<br />

International and their local NGO affiliate, Asity. Over the<br />

past ten years, the annual event has engaged thousands of<br />

participants from 120 schools and ten communes in the<br />

region. The Akolahinala Association, an environmental club,<br />

was created by students from Mahatalaky’s primary and<br />

secondary schools after the first Bird Watching Day event<br />

in 2001.<br />

QMM has encouraged students from national and<br />

international universities to partner with the company for<br />

their research studies. In the biodiversity department, over<br />

200 students (Bachelor, Masters and PhD) have collaborated<br />

with QMM specialists since the beginning of the project, with<br />

more than 100 internationally published scientific publications<br />

produced through this partnership.<br />

Recognising the importance of environmental education,<br />

especially for <strong>Madagascar</strong>’s future generations, QMM is active<br />

in establishing environmental initiatives across its partner<br />

primary and secondary schools. Green spaces have been<br />

constructed around the schools, with trees planted and<br />

gardens and flowerbeds created, all of which are managed by<br />

the students. In the village bordering the forests of Petriky,<br />

QMM organised a tree planting day and explained the<br />

importance of the forest’s endemic species and the need for<br />

conservation. Over 450 children’s books including messages<br />

about the importance of protecting the environment have<br />

been distributed.<br />

Since 2001, QMM has organised the largest bird celebration in<br />

<strong>Madagascar</strong>, Bird Watching Day, in collaboration with BirdLife<br />

A student participates in 2011’s Bird Wachting Day, the largest<br />

bird celebration in <strong>Madagascar</strong>.<br />

57


The Production Phase<br />

fostering good governance<br />

Since March 2009, <strong>Madagascar</strong> has faced political instability,<br />

generating drastic socioeconomic implications. The reduction<br />

of official development assistance (ODA) to the country<br />

and an embargo on contracts between the government<br />

and international development agencies has had severe<br />

consequences. <strong>Madagascar</strong>’s development was heavily<br />

dependent on ODA, which accounted in 2008 for fully 50<br />

per cent of all public expenditures and 75 per cent of all<br />

public capital investment 10 . These events, in turn, have had<br />

far-reaching impacts on the project, which was structured to<br />

be part of a much larger regional development effort and<br />

to build on the assets of a comprehensively designed publicprivate<br />

partnership.<br />

Managing growth through transparency<br />

When governance is strong, extractive industries can<br />

generate large revenues, fostering economic growth and<br />

reducing poverty. However, when governance is weak and/<br />

or corruption and rent-seeking are rampant, they may<br />

cause poverty, conflict and further corruption, generating<br />

the so called “resource curse.” The Extractive Industry’s<br />

Transparency Initiative (EITI) seeks to overcome this<br />

drawback by improving transparency and accountability<br />

through supporting improved governance in resourcerich<br />

countries 10 . Due to <strong>Madagascar</strong>’s political instability,<br />

progress in the EITI has been slow. However, an EITI pilot<br />

report published in February 2010 shows for the first time in<br />

<strong>Madagascar</strong> significant revenue flows being recorded.<br />

By law in <strong>Madagascar</strong>, as stipulated in the Mining Code,<br />

royalties, taxes and dividends are to be paid at the<br />

national, regional and local level. In 2011, QMM paid<br />

US$5,400,000 in taxes, royalties and dividends. Thirty per<br />

cent of royalties are allocated to the Anosy region, 60 per<br />

cent to communes directly impacted (Ampasy Nahampoana,<br />

Mandromondromotra and Fort Dauphin) and 10 per cent<br />

to the former province of Toliara 17 .<br />

How are the royalties being spent?<br />

the Commune of Ampasy Nahampoana has<br />

invested in:<br />

- A new Market Place<br />

- A bus travelling between Ampasy<br />

Nahampoana and fort dauphin<br />

- A child day care centre<br />

- Ten new rooms at the CSB<br />

- Renovation of the public secondary school<br />

58


The Production Phase<br />

QMM and GIZ are working to facilitate local good<br />

governance and economic diversification in the<br />

communities living around QMM mining activities. Recognising<br />

the importance of communicating the EITI and enhancing public<br />

understanding, grassroots structures have been identified as<br />

the most effective vehicle to deliver the EITI communication<br />

strategy to local communities. Training and seminars have<br />

been organised for civil society members, who then generate<br />

public awareness about the importance of EITI. Capacities<br />

in participatory planning and budgeting of the communities<br />

receiving mining royalties have been strengthened. Activities<br />

have been carried out to include residents and community<br />

representatives in discussing and voting on spending priorities<br />

and making and voting on spending proposals. Additionally,<br />

economic development and trade of local enterprises and<br />

associations/cooperatives have been promoted by reinforcing<br />

capacities regarding product and market development. As the<br />

communities bordering Mandena are implementing several<br />

income-generating activities, market and trade opportunities<br />

related to these income-generating activities have been<br />

analysed and entrepreneurship and innovation promoted<br />

through seminars and trainings.<br />

The Fasimainty centre<br />

The Fasimainty Centre came into existence with the<br />

objective of creating a transparent and smooth flow of<br />

information, not only for the extended community, but<br />

also for employees. The Centre, strategically located in<br />

the heart of Fort Dauphin, ensures QMM’s continual<br />

contact with all stakeholders. In addition to its classic<br />

information and communication function, the Centre is<br />

an instrument for monitoring public opinion. Information<br />

collected from interactions with visitors is sent to relevant<br />

departments, who then take the appropriate followup<br />

action on any issues. The Fasimainty Centre, a new<br />

concept in the Anosy region, is one of the tools devised<br />

by management to achieve an important goal of QMM;<br />

harmonious integration of the company with its host country,<br />

as well as harmonious integration of new recruits into the<br />

company, in order to achieve optimal results.<br />

59


The Production Phase<br />

Groundtruthing with a local citisen near Sainte<br />

Luce. Sites and areas of interest, including sacred<br />

sites, forests and villages are visited, described<br />

and their coordinates taken. Primary classification<br />

(land use) is also verified through satellite imaging.<br />

60


The future<br />

Long-Term SUSTAINABILITY<br />

The flagship programmes: FAGNEVA and PDI<br />

A Regional MINING FOUNDATION<br />

The Importance of Stakeholder Engagement<br />

THE NEXT MINing ZONES<br />

Sainte LUCE and Petriky<br />

61


The future<br />

Long-term sustainability<br />

“QMM is an important motor of<br />

development for the region, through<br />

the direct economic activity of the mine<br />

and port and through its actions as a<br />

Responsible corporate entity 10 .”<br />

While QMM is an important factor to regional development,<br />

it is only one factor. The benefits derived from the project<br />

can only be sustainable if QMM is one element of a<br />

much broader and more ambitious regional development<br />

strategy. The building of the vehicle for development<br />

started very well with the establishment of the CRD and<br />

the PDR. Unfortunately, the protracted political crisis and<br />

the repercussions which have followed, particularly the<br />

suspension of development financing, have impacted the<br />

project and complicated QMM’s relations with a multitude<br />

of stakeholders. This has placed QMM in a situation where it<br />

risks becoming less of a development partner and more one<br />

of the only development actors in the region.<br />

Given this context, QMM has placed high priority on<br />

rebuilding and strengthening key development partnerships.<br />

Significant collaborative efforts are being made by the<br />

private sector, local communities, government authorities<br />

and civil society to revitalise a regional development platform<br />

for Anosy. There remains a shared commitment to work<br />

together to achieve goals once established in the PRD. There<br />

is the hope that a relaunch of the CRD will take place, filled<br />

with a new roundtable of partners working together to<br />

update the PDR.<br />

QMM’s conduct can set standards of responsibility and<br />

excellence for subsequent mineral extraction projects in the<br />

<strong>Madagascar</strong>, which is especially important given the rapid<br />

increase in national mineral production. QMM must succeed<br />

in commercial, environmental and social terms. Encouraging<br />

progress is being made across many fronts and QMM is<br />

working to not only improve relations with the community<br />

but also reinvigorate many key regional institutions which have<br />

the ability to lead the region into a better, more sustainable<br />

future.<br />

The Flagship Programmes: Fagneva and PDI<br />

QMM has made a time-limited contribution to the sustainable<br />

development of the region through the Fagneva programme<br />

and the PDI. As the programmes are expected to continue<br />

for another two and four years, activities are continually being<br />

developed and implemented.<br />

62


The future<br />

Future activities under the Fagneva programme include:<br />

--<br />

The operation of a new waste management site in Fort<br />

Dauphin.<br />

--<br />

The construction of an office and housing complex for<br />

the Gendarmes working in Mahatalaky (near Sainte Luce).<br />

--<br />

The promotion of tourism and entrepreneurship.<br />

--<br />

The continual promotion and support of the CRD and<br />

PDR.<br />

Future activities under the PDI include:<br />

--<br />

A dairy project, introducing milk-producing cows to the<br />

region.<br />

--<br />

The operation of a commuter barge servicing the<br />

Ambavarano lake, between the villages of Lanirano and<br />

Evatraha, which will open up trade and transport for the<br />

agricultural and fishing-based population.<br />

--<br />

The reuse and recycling of waste material found across<br />

QMM sites, utilising scrap metal, tires and, for the<br />

manufacturing of tiles, plastic bottles.<br />

The PDI projects are currently funded and managed by QMM,<br />

in addition to the taxes and royalties that go directly to the<br />

impacted communities. These initiatives have the ability to<br />

significantly contribute to poverty reduction in the region.<br />

However, two primary challenges face the PDI. The first is<br />

to expand beyond the pilot phase to become ingrained,<br />

widespread practice. The second is to ensure sustainability<br />

once the allocated time commitment of QMM expires.<br />

Time, effective training and capacity building will allow the<br />

communities to develop skills to continue independent of<br />

QMM, ensuring their empowerment and full ownership of the<br />

projects. To reduce dependency on QMM as the sole source<br />

of funding, a constructive exit strategy must be put in place.<br />

The vehicle with the most potential for such a role is the<br />

regional mining foundation.<br />

A regional Mining Foundation<br />

QMM is operating in a remote, very poor and underdeveloped<br />

location. The company has found itself in a situation of<br />

catalysing development at the local, regional and national<br />

level. Responding to this multifaceted context, globally, the<br />

mining sector is increasingly turning to foundations, trusts and<br />

funds (FTFs) as vehicles to share the benefits derived from<br />

mineral production with communities. FTFs can be used<br />

as mechanisms for the distribution of social and economic<br />

contributions and payments from companies to communities.<br />

They provide opportunities to develop sustainable community<br />

development programmes from the mining sector. If applied<br />

with a clear vision and clarity of purpose, transparency and<br />

accountability and managed accordingly, they can become the<br />

success story of a mining operation 19 .<br />

According to the Mining Code, the region and three<br />

communes bordering QMM are direct recipients of the<br />

mining royalties. In the interest of effective, balanced and fair<br />

development for all the people of Anosy, QMM recommends<br />

the establishment of a regional mining foundation to manage<br />

a portion of the funds arising from mining revenues. This will<br />

allow greater regional equity to be achieved. The foundation<br />

should be structured and applied as an instrument for longterm<br />

regional development, to ensure sustainability of funding<br />

beyond the life of the mine.<br />

Although progress towards establishing such a foundation<br />

remains slow and uncertain, QMM will continue to enlist the<br />

support of interested parties for its establishment and help<br />

ensure the foundation’s focus is squarely on high impact, longterm<br />

development projects such as what the PDI promotes.<br />

QMM will also work to establish future partnerships for these<br />

projects and attract additional financing from other sources.<br />

63


The Future<br />

“For sustainable development in the<br />

Anosy region to be achieved, it will<br />

be the result of collective, multistakeholder<br />

efforts 20 .”<br />

The international advisory panel to qmm<br />

The importance of stakeholder engagement<br />

One of QMM’s main challenges is to effectively communicate<br />

with its many stakeholders. QMM must continuously respond<br />

to the development of its relationships with the community.<br />

The company must manage expectations with regards to<br />

what the project can and cannot provide, as well as set clear<br />

boundaries to its commitments. To prevent future conflict,<br />

there is a large need to develop stronger stakeholder<br />

engagement and to bring together all actors in the region to<br />

work collectively toward common development goals.<br />

Given the context in which QMM is operating, complaints,<br />

feelings of injustice and resentment will exist. The region’s level<br />

of poverty and decades of neglect fosters these sentiments.<br />

Recognising this, QMM, by recommendation of the Office of<br />

the National Mediator, is establishing a new, integrated and<br />

strategic mediation process. This approach is being developed<br />

to ensure effective mechanisms are in place to address formal<br />

complaints and to allow for open dialogue, where differences<br />

can be expressed, explained and communicated, tensions<br />

reduced and mutual understanding built.<br />

The recently developed Conflict Prevention Strategy<br />

will bring together all stakeholders, including those critical or<br />

opposed to the project, in a three-tier mechanism supported<br />

by an independent and neutral pool of mediators. One<br />

national mediator and three local mediators will support<br />

and facilitate the process, working with each of the three<br />

structural levels.<br />

1) A triptych committee composed of the Chef de Région,<br />

the President of the Organisation of Civil Society and the<br />

President of QMM, as the ultimate decision authority.<br />

2) A Conseil des Parties Prenantes (CPP, or Stakeholders<br />

Council) with 24 members equally representing branches of<br />

government, civil society and QMM. Participating members<br />

are both a source of and possible solution to conflicts, thus<br />

the crucible for discussion.<br />

3) The implementation level through existing structures,<br />

most specifically the 15 steering committees and the<br />

Structures de Dialogue (SDD, or Dialogue Structures) 20 .<br />

This system does not replace the official institutions of the<br />

region, but has been created to respond to the need for<br />

maintained trust and communication between QMM and the<br />

community and to avoid future social conflict.<br />

In addition to mechanisms such as the Conflict Prevention<br />

Strategy, QMM has strived to professionalise its more<br />

conventional approaches to communication. “Remembering<br />

communication is a two-way street where listening is as essential<br />

as explaining.” It is about developing relationships based on<br />

mutual understanding and reciprocal respect 20 . The strategies<br />

employeed should not pre-empt or interfere with the Conflict<br />

Prevention Strategy, nor should they only recognise the<br />

successes of the project. The challenges and constraints must<br />

also be transparently communicated to minimise any future<br />

misunderstandings and address problems which may arise.<br />

64


The Future future<br />

Communication Channels<br />

QMM is engaged in several different channels of dialogue.<br />

Communication platforms have been established to<br />

facilitate interactions with various stakeholders. To engage<br />

with communities, structures de dialogue (SDD, or<br />

Dialogue Structures) have been formed. Five community<br />

members per fokontany form a committee. Elected by a<br />

general assembly, “these members are the bridge between the<br />

population and the company.” Once per month members of<br />

the Community Relations team hold informational meetings<br />

at the commune level with the SDDs. Working with 40<br />

fokontany, across eight communes, the SDDs enable QMM’s<br />

continuous engagement with its neighbours.<br />

The Port of Ehoala<br />

The Port of Ehoala will continue to generate<br />

increased economic activity and contribute to the<br />

long-term sustainable development of the Anosy<br />

region.<br />

QMM and the Government of <strong>Madagascar</strong> envision<br />

the 400ha plot of land adjacent to the existing<br />

infrastructure will be designated for commercial use.<br />

To encourage new business and development, the<br />

Port Authority is seeking Free Port status. Investment<br />

in light industry, the processing of foodstuff and<br />

transhipment facilities are planned in the free port<br />

zone.<br />

Comites de pilotage (or Steering Committees) comprised of<br />

QMM staff and representatives of the concerned community<br />

have been created to address 15 specific priority areas<br />

related to QMM activities and to the development of the<br />

region. QMM practices such as employment, procurement<br />

or the communities concerns regarding electricity in Fort<br />

Dauphin are addressed. Once an issue is resolved or an<br />

overlap develops between priority areas involving the same<br />

committee members, the committees’ numbers are reduced.<br />

Although QMM makes continuous efforts to successfully<br />

interact and engage with its stakeholders, effective<br />

communication is one of the company’s main challenges.<br />

Several questions still exist, such as: Are the platforms truly<br />

representative, with women being adequately represented?<br />

Are all community members being reached? Are topics of<br />

discussion relevant and how can the sharing of information<br />

be improved? QMM is working to address these concerns<br />

and intensify dialogue through its many different channels.<br />

Members of five fokantany gather for an SDD meeting.<br />

65


the future<br />

the next mining zones<br />

Sainte LUCE AND PETRIKY<br />

Mandena is the first operational zone, where production<br />

has commenced and will continue until the deposit has<br />

been exhausted. The future mining zones of Sainte Luce<br />

and Petriky have been explored and the mineral deposits<br />

confirmed. Noting the projected global demand for ilmenite<br />

is anticipated to increase quickly and significantly in the<br />

coming years, the schedule originally envisaged for Sainte<br />

Luce and Petriky may be accelerated.<br />

point of reference to realistically comprehend changes the<br />

mining project will bring. Effective communication, through<br />

permanent dialogue, will be important when explaining the<br />

project and its expected impacts, both positive and negative.<br />

Past experience, and building on the successes and lessons<br />

learnt from Mandena, will help guide QMM’s approach<br />

and subsequent activities so it may continue to positively<br />

contribute to the region and its citisens.<br />

QMM has had an active presence in these zones for many<br />

years. Engaging in frequent and ongoing dialogue with the<br />

community and authorities, informal public consultations have<br />

taken place since the 1990’s. As the project moves forward<br />

in Sainte Luce, preliminary baseline studies are underway,<br />

including a land use study, which explores land tenure, culture,<br />

customs and sacred sites and involves participatory mapping<br />

and continuous, interactive relations with the population.<br />

These studies will lead to the Social and Environmental Impact<br />

Assessment (SEIA), a process that could take several years.<br />

Sainte Luce is a significantly larger site than Mandena. The<br />

same considerations, concerns and challenges will be raised,<br />

but on a much greater scale. Similar to the communities<br />

bordering Mandena, the Sainte Luce population will have no<br />

A participatory mapping session near Sainte Luce involves<br />

identifying all sites and areas of interest within the fokontany,<br />

such as villages, rice fields, agricultural land, forests, mahampy<br />

beds and sacred sites.<br />

66


The Future future<br />

Progress so far<br />

Sainte Luce<br />

--<br />

A conservation zone totalling approximately 1000ha has<br />

been established, as well as a research centre.<br />

--<br />

Thirteen women from the villages bordering the<br />

conservation zone are being employed to work in the<br />

camp canteen. The women prepare breakfast, lunch and<br />

dinner for those working at the research centre and in<br />

the conservation zone.<br />

--<br />

Guards have been trained and hired from surrounding<br />

villages to protect the conservation zone and maintain<br />

the grounds.<br />

--<br />

A CSB, the only health centre for the population of<br />

3,800 residing in the three villages of Sainte Luce, was<br />

constructed in 2004 through QMM funding. Before this<br />

health clinic was established, the population travelled ten<br />

kilometres to the nearest CSB in Mahatalaky.<br />

The canteen women at work in the Sainte Luce conservation<br />

zone.<br />

Petriky<br />

--<br />

A conservation zone totalling 120ha has been established,<br />

as well as a research centre.<br />

--<br />

QMM funded the construction of a secondary school in<br />

the village of Loharano, closest to the ilmenite deposit.<br />

In 1999 a semi-permanent structure made of wood was<br />

constructed and in 2005 the present concrete structure<br />

was built.<br />

--<br />

Public consultations have been carried out since 1998.<br />

Students from Loharano’s (Petriky) secondary school.<br />

67


The Production Phase<br />

conclusion<br />

It has been a long road from exploration to today. QMM’s<br />

foundations rest on work that has extended over the decades.<br />

These undertakings have led to exceptional knowledge and<br />

management of the region’s biodiversity, approaches and<br />

structures that aim to avoid the traps of enclave industries,<br />

most notably embedding the project within the larger regional<br />

framework of long-term social, economic and environmental<br />

development, and transparent, measurable commitments<br />

to a Net Positive Impact (NPI) over fifty years. QMM has<br />

made extensive investments in its employees, its partnerships<br />

and its involvement with local communities. Through<br />

ongoing engagement, a shared commitment to the region’s<br />

development has been fostered. Identifying communities<br />

surrounding its operations and those from which it draws<br />

its employees as key stakeholders, QMM is dedicated to<br />

68<br />

“QMm is a big player but not the main Actor<br />

in the anosy region. We need to continue<br />

engaging with different stakeholders,<br />

improve our regional collaboration and<br />

ensure sustainable developement is a shared<br />

endeavour. If we can do this, the region<br />

will become more wealthy and healthy.”<br />

Manon Vincelette, General manager Community relations,<br />

sustainable development and biodiversity<br />

continuous engagement with these groups to determine<br />

their development needs. QMM will ensure it continues to<br />

support relevant initiatives while maintaining the potential to<br />

foster meaningful development.<br />

As the project evolves, challenges will be ever persistent.<br />

Today, QMM must continue to devote attention to the<br />

management of expectations so they are realistic. This must<br />

be done more effectively than in the past and should be<br />

approached as much as possible through partnerships rather<br />

than QMM acting alone. QMM must improve in the delivery<br />

of its partnerships, work together more effectively with its<br />

many stakeholders and ensure regional development is a<br />

shared endeavour. This will require strong leadership, ongoing<br />

engagement and permanent dialogue. Institutions established<br />

for the development of the region through almost two<br />

decades of efforts need to be revitalised. QMM is working<br />

to see this is achieved. Lastly, QMM must ensure it follows<br />

though on its commitments and delivers its contributions so<br />

these outcomes generate positive impacts.<br />

Once placed in the larger picture, it is evident much has been<br />

achieved thus far and key foundations on which to continue<br />

building are well positioned. Recognising it takes a sustained<br />

and collaborative effort, as well as time to bring about<br />

meaningful change, QMM is committed to the long-term and<br />

will continue to ensure the project’s success for not only itself,<br />

but for the people and country of <strong>Madagascar</strong>.


Useful Abbreviations and Acronyms<br />

COGEma<br />

CPP<br />

CRD<br />

CRFPTA<br />

CSB<br />

DUP<br />

EITI<br />

FTFs<br />

GDA<br />

GIZ<br />

HIA<br />

HIMO<br />

ICaR<br />

IEC<br />

IGA<br />

INSTAT<br />

IFRA<br />

NGO<br />

NPI<br />

ODA<br />

PAGS<br />

PAPs<br />

PDI<br />

PDR<br />

PIC<br />

QMM<br />

RAP<br />

SDD<br />

SEIA<br />

STI<br />

UNDP<br />

UniCEF<br />

USAID<br />

Comité de Gestion de Mandena (mandena management committee)<br />

Conseil des parties prenantes (Stakeholders council)<br />

Comité Régional de Développement (Regional <strong>Development</strong> Committee)<br />

Centre Régional de Formation Professionnelle et de Technique d’Anosy (Anosy Vocational and Technical Training CentRe)<br />

Centre de santé de base (primary health care centre)<br />

déclaration d’utilité publique (Public Utility Declaration)<br />

Extractive Industry’s Transparency Initiative<br />

Foundations, Trusts and Funds<br />

Global <strong>Development</strong> Alliance<br />

Deutsche Gesellschaft für Internationale Zusammenarbeit<br />

Health Impact assessment<br />

Haute intensité de main d’oeuvre (High Intensity Labour Projects)<br />

Association Internationale de Crédit Agricole et Rural (International Association of Agricultural and Rural Credit)<br />

Information, education and communication<br />

Income generating activities<br />

Institut national de statistique de madagascar (National Institute of Statistics)<br />

Institution Financière Régionale d’Anosy (Regional Financial institution of Anosy)<br />

Nongovernmental Organization<br />

Net Positive Impact<br />

Official development assistance<br />

Plan d’aménagement et de gestion simplifé de Mandena (Simplified Mandena Management and <strong>Development</strong> Plan)<br />

Persons Affected by the Project<br />

Programme de développement intégré (Integrated <strong>Development</strong> Programme)<br />

Plan de Développement Régional (Regional <strong>Development</strong> Framework)<br />

Pôle Intégrés de Croissance (Integrated Growth poles)<br />

QIT <strong>Madagascar</strong> <strong>Minerals</strong><br />

Resettlement Action Plan<br />

Structures de dialogue (Dialogue Structures)<br />

Social and Environmental Impact Assessment<br />

Sexually transmitted infection<br />

UNITED nations development programme<br />

United Nations children’s Fund<br />

United States Agency for International <strong>Development</strong><br />

69


SOURCES<br />

1. CIA Factbook “madagascar” (July 2011 Estimate)<br />

2. UNDP HDI Index Report (2011)<br />

3. UNICEF STATistics “<strong>Madagascar</strong> at a glance” (2010)<br />

4. Kull, C.A. “Deforestation, Erosion and Fire: Degradation Myths in the Environmental History of<br />

<strong>Madagascar</strong>”, Environment and History, 423-450. (2000)<br />

5. “Anosy” Wikipedia online (July 2011)<br />

6. Puhlmann,T. “The Impact of QIT <strong>Madagascar</strong> <strong>Minerals</strong> (QMM) on Local Economic <strong>Development</strong> of<br />

Fort Dauphin” <strong>Madagascar</strong> (December 2008)<br />

7. www.riotintomadagascar.com<br />

8. QMM SA Ilmenite Project, Social and Environmental Impact Assessment Summary (May 2001)<br />

9. Memorandum of Understanding between the United States Agency for International <strong>Development</strong><br />

and QIT <strong>Madagascar</strong> <strong>Minerals</strong><br />

10. Report of the International Advisory Panel (June 28, 2010)<br />

11. QMM/<strong>Rio</strong> <strong>Tinto</strong> in madagascar “Case B: Engaging with local communities”<br />

12. Construction of the madagascar ilmenite project “QMM Memories” (December 2009)<br />

13. Results and Prespectives of the Ilmenite Project in Fort dauphin (2009)<br />

14. The impact of Qmm on local economic development of Fort dauphin<br />

15. Interview, Ceilo Terra Veronica Bevivino (May 2011)<br />

16. Schools for <strong>Madagascar</strong>: Close to Home. UNICEF <strong>Madagascar</strong> Country Office, Education Toolkit,<br />

<strong>Madagascar</strong><br />

17. QIT <strong>Madagascar</strong> <strong>Minerals</strong> (<strong>Rio</strong> <strong>Tinto</strong>) Sustainable <strong>Development</strong> report (2010)<br />

18. Anosy: Schéma de Développement Régional de l’Anosy (SDR) (July 31, 2001)<br />

19. Mining Foundations, Trusts and Funds: A Sourcebook, The World Bank (June 2010)<br />

20. Report of the International Advisory Panel (August 7, 2011)<br />

70


Words By rachel Long<br />

Design By cathy Haenlein and Rachel Long<br />

Images by Rachel Long and QMM<br />

Contributions by the community relations, sustainable<br />

development and biodiversity Teams, the president, the<br />

international advisory panel To QMM, QMM partners and<br />

local communities<br />

Printed By NIAG<br />

<strong>Rio</strong> <strong>Tinto</strong>/QMM, December 2011


QIT <strong>Madagascar</strong> <strong>Minerals</strong><br />

bp 4003<br />

101 <strong>Madagascar</strong><br />

T + 261 20 22 425 59<br />

www.riotintomadagascar.com

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