VietNamNet Bridge – Mining is tending to exacerbate poverty rather than alleviate it, according to the results of an 18-month study on the impacts of mining in the provinces of Hoa Binh, Phu Tho, Lao Cai, Lam Dong and Dak Lak Province conducted by the Centre for People and Nature Reconciliation in July 2009.

Mao Khe Coal Co officials inspect an illegal coal furnace on Dong Trieu District, Quang Ninh Province. A study has revealed that mining does not improve the lives of local residents. (Photo: VNS)

Negative impacts on the lives of local residents were revealed in all of the areas studied, said the author of the centre's report, Tran Thi Thanh Thuy.

"The poor seem to benefit nothing from mining operations," she said.

For instance, in Phon and Lung Thung Villages in Tan Pheo Commune in the northern province of Hoa Binh's Da Bac District, where an iron mine has been in operation since 2007, over 40 of the 118 households in the two villages were stripped of their homes and agricultural land to make way for mining operations, with residents falling into unemployment and poverty.

Land clearance compensation received by households in these areas was very low, ranging from VND1,000 to VND11,000 per square metre of land, according to the report.

The mining operations themselves also failed to provide jobs to the local poor due to their lack of knowledge and job skills. Only five local residents in these villages were offered jobs, and these were temporary positions as security guards or cooks at the mine.

Mining contributes about 10 per cent to gross domestic product (GDP), according to the General Statistics Office, but generates only about 1 per cent of the country's total contract employment.

The report by the Viet Nam Chamber of Commerce and Industry (VCCI) also noted that fewer than 50 per cent of mine workers held more than temporary or seasonal employment with an uncertain income.

In addition, mining operations destroyed water and soil resources in these areas.

Duong Thi Thuy, an official from the People's Committee of Tan Pheo Commune, said that the iron mine had worsened the quality of life for local residents, increasing the proportion of households living in proverty by 11 per cent since 2007.

Similar impacts could be seen in the other four localities surveyed, Thuy said, including Son Thuy (Phu Tho), Ea Sar (Dak Lak), Coc My (Lao Cai) and Loc Phat (Lam Dong), including pollution and degradation of bridges and roads caused by irresponsible mine operators.

The director of the Ministry of Natural Resources and Environment's Department of Mining Management, Lai Hong Thanh, said that small-scale mining enterprises often ignored their responsibilities because they wanted to maximise profits.

A study by Scott Pegg from Indiana University-Purdue University Indianapolis (IUPUI) also concluded that the impacts of mining could increase the vulnerabilities of the poor while exposing them to a variety of social risks, including unemployment, inflation and social tensions.

"It is important now to take steps to ensure the compatibility between mining and poverty reduction," Thuy said.

According to Thanh, Viet Nam's new Mineral Law , which took effect on July 1, 2011, would help ensure mining enterprises take responsibility for protecting the environment and contributing to local development.

Under the law, mining licence fees could generate VND5-7 trillion (US$240-340 million), he said, as well as require mining enterprises to contribute to local infrastructure and employment of local workers. Regulations on payment of compensation were also included in the law, Thanh said.

Rigorous enforcement of the new law was necessary to reduce the negative impacts of mining on the poor while increasing the contributions of the mining industry to poverty reduction, he added.

Viet Nam has about 500 mines exploiting 600 different types of minerals throughout the country. During 2006-09, the nation became a global leader in exporting such minerals as coal, tin and barium.

VietNamNet/Viet Nam News