Sierra Leone could lose more than 7,000 mining jobs following a decision by the country’s largest employer to temporarily retrench workers.
Although workers at African Minerals – which is not only Sierra Leone’s biggest iron ore producer but also the biggest contributor to its GDP – were sent home with full pay at the beginning of November, it is a situation that workers and trade unions fear may turn permanent.
Executives at the London-listed company cite the falling price of iron ore for the “controlled shut down initiated at operations” at the flagship Tonkolili mining project – 25 per cent of which is owned by China’s Shandong Iron and Steel Group.
African Minerals, which recently
took over its biggest competitor, the executive chairman of African Minerals.
Until recently, the two companies accounted for 16 per cent of Sierra Leone’s GDP, with African Minerals exporting 15.7 million tonnes of iron ore valued at US$549.5 million in 2014, according to data from the country’s central bank.
But Sierra Leone’s mining industry has been badly hit by the Ebola virus, which has so for claimed more than 3100 lives (as of 26 January 2015).
The closure of the Tonkolili mine would be a devastating blow.
“It will be dangerous, very catastrophic, if the government sits down and allows Africa Minerals go down the drain. We already have too many unemployed people in this country, especially amongst the youth,” Moses Gbondo, general secretary of the Mining and Allied Services Employees Union, told Equal Times.
“It is necessary for the government to step in to protect the jobs and collect taxes.”
With a population of approximately six million people, Sierra Leone has an employment rate of 60 per cent – a situation compounded by the Ebola outbreak.
Analysts have expressed concern that the permanent closure of the country’s largest employer would send the economy into a tailspin.
“Over the past four years, if you look at our economic growth rate, it was really very good and 50 per cent of that was actually coming from the mining sector,” said Abdulai Brima, a senior economics lecturer at Fourah Bay College, the University of Sierra Leone.
“So if the mining sector collapses then it is going to have serious implications for the country because this sector was able to absorb most of our unskilled labour,” he told Equal Times.
“If there are massive formal mining job losses, we are going to see a lot of unemployed, unskilled workers on the streets, and that may create social tension in the country,” said Brima.
This tiny West African nation is still recovering from a brutal, decade-long civil war (1991-2002) which left over 50,000 people dead and hundreds of thousands injured, maimed and displaced.
Massive inequality, corruption, high unemployment and endemic poverty all contributed to starting the deadly conflict in this resource-rich country – as did the mining and trading of so-called “blood diamonds”.
Sierra Leoneans are desperate to avoid any tears to the country’s fragile social fabric that may lead to a return to hostilities, which is why the fate of the Tonkolili miners is so important.
A team from the Ministry of Mines and Mineral Resources has joined African Minerals and Shandong in negotiations to try and find a way to revive the Tonkolili mine but until an agreement is reached, Sierra Leone’s long suffering workers will continue to hold their breath.
