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FOCUS September 2014 Volume Vol.77

Human Rights in the Mining Industry of Mongolia*

Centre for Human Rights and Development

The mining industry is a core player in Mongolian development and economic growth. It is flourishing, and drawing attention from many foreign investors. Yet it has been getting more and more clear that local and foreign mining companies are practicing the so-called “Take the gold and leave the dirt” approach. In other words, the mining activities of both local and foreign companies are damaging the environment, and violating the human rights of people in the mining areas.
The Mineral Resources Authority of Mongolia reported that it issued 3,692 special licenses in 2012  covering 22.3 million hectares of land.1 These licenses cover areas in different provinces and soums (districts) of the country. In one case, eleven mining companies have license to mine on 1.1 million hectares out of 2.8 million hectares of the Gurvan Tes Soum. The mining operations in this soum would make herding by local people difficult. Mining operations have adverse impact on the traditional agricultural activities of a significant number of the population. The mining operations affect herders due to decreasing pasture area and water resources. They are also displaced due to resettlement in other areas.2 This is an example of unsystematic granting of licenses.
Dust pollution caused by the transportation of minerals from the mines is also causing hardship on people and animals along the roads used by big mining trucks. Even in areas where roads are paved, the level of dust pollution does not go down due to the number of trucks traversing them.
Air pollution in the form of dust cloud is either forty five times higher in the case of large particle dust or thirty to thirty- five times higher in the case of small particle dust than the national standard average. This is true in several soums.
The Ministry of Environment and Tourism, on the other hand, has reported earlier in 2010 that 17,966 hectares have been destroyed by mining operations. The National Human Rights Commission of Mongolia reported that mining companies left unrehabilitated hundreds of hectares of land in several soums (46.7 hectares in Airag Soum, Dornogobi province; 562.6 hectares in Uyanga soum, Uvurkhangai province; 500 hectares in Bayan-oo soum, Bayangkhongor province). Another report puts the figure at more than six thousand hectares.3
The mining industry, the major pillar of the Mongolian economy, is concentrating on the Gobi region that has scarce water resources. This means that mining operations would have major impact on the Gobi ecological system, which in turn can lead to serious impact on the health of people in the area.

Northeast Asian Companies in the Mining Industry

Northeast Asian companies are very much involved in the Mongolian mining industry according to relevant government records.
As of 2012, four hundred fifteen foreign companies have registered in Mongolia to do business pertaining to the mining and oil industries. Of this number, one hundred seventy-nine are Chinese, Korean and Japanese companies as shown in the following data:

  • • China – one hundred thirty- nine companies (33.49 percent);
  • • South Korea - thirty companies (7.23 percent);
    and
  • • Japan - ten companies (2.41 percent).

The analysis of various reports about the mining operations of the Northeast Asian companies show violations of the mining and other laws, including:

  • a. Undertaking activities (such as drilling holes, boring water wells, mining) without proper authorization;
  • b. Failure to secure and rehabilitate abandoned mining areas;
  • c. Unauthorized construction of railway and exportation of minerals;
  • d. Securing an extension of exploration license period despite reports of serious violations of terms of the license;
  • e. Failure to comply with the regulations on safety of workers and protection of the environment;
  • f. Threat of dismissal of workers who planned to form a trade union;
  • g. Failure to compensate family of worker who died due to work-related accident; and
  • h. Failure to raise the salary of workers.

Laws and Mining

The Mongolian Constitution guarantees the right to “healthy and safe environment and to be protected from environmental pollution and ecological imbalance.” (Article 6). Further, the Constitution provides the State responsibility on human rights:

1. The State shall be responsible to the citizens for the creation of economic, social, legal and other guarantees for ensuring human rights and freedoms, to fight against violation of human rights and freedoms and to [remedy these violations]. (Article 19)

On the use of natural resources, Article 6 of the Constitution provides:

4. The State shall have the right to hold responsible the land owners in connection with the manner the land is used, to exchange or take it over with compensation on the grounds of special public need, or confiscate the land if it is used in a manner adverse to the health of the population, the interests of environmental protection and national security.
5. The State may allow foreign nationals, legal persons and stateless persons to lease land for a specified period of time under conditions and procedures as provided for by law.

Mongolian laws5 regulate the mining industry with provisions on granting and revocation of mining licenses, exclusion of areas from mining operations, local government authority on mining operations, rehabilitation of areas that have been mined, and consultation with local residents on the planned mining operations.
 Mongolia joined in 2006 the Extractive Industries Transparency Initiative (EITI), which has two main objectives: to disclose and reconcile extractive industries revenues paid to and received by governments (taxes, royalties, and signature bonuses), and to promote and strengthen the multi-stakeholder dialogue approach. In short, the process requires companies to “publish what they pay and governments publish what they receive in an EITI Report where the tax and royalty payments are independently verified and reconciled.” This process is overseen by a multi-stakeholder group of governments, companies and civil society.6
By participating in EITI, Mongolia addresses the “Paradox of Plenty” issue and endeavors to make the benefits of extractive industries reach the poorer sections of society.7 The Mongolia EITI Mid-term Strategy (2010-2014), adopted on 24 June 2010, includes the following provisions on stakeholders in the extractive industry:

Objectives of Mongolia EITI capacity building:
xxx xxx   xxx
3. To cooperate with stakeholders and concerned civil society representatives on civil monitoring and policy influencing methods; and
4. To continue collaboration with other NGOs for company governance and responsible mining.8

Mongolia published its latest report in December 2013, the seventh reconciliation report.9

General Observations

An analysis of the problems that arose from the operations of mining companies in Mongolia identified several root causes:

  1. 1. Laws are too general and weak to enhance public participation in environmental decision- making, and to strengthen the capacity and knowledge of local communities to enable them to protect their rights and interests;
  2. 2. Environmental laws are dedicated only to protecting plants or animals and do not consider the individual's right to land, safety and security;
  3. 3. The international mining operations standards are not implemented, while domestic standards are poor and outdated. Mining operations are commonly allowed to start even before the needed infrastructures have been prepared;
  4. 4. Lack of policy on the use of income earned from the mining industry to support sustainable development, reduce poverty and mitigate risks after exhausting limited non-renewable natural resources;
  5. 5. Lack of regulations on holding private companies accountable for the environmental problems and human rights abuses caused;
  6. 6. Lack of regulations on holding state organizations and civil servants accountable for their illegal activities by bringing them to court, and lack of enforcement of related court decisions. 

Legal Remedies

Civil society organizations have been handling most of the public interest litigation cases in Mongolia since 2000. Most of the cases involved environmental and human rights abuses caused by irresponsible mining activities, and the protection of human rights of local nomadic communities. The issues affecting nomadic communities constitute the emerging human rights issues in Mongolia.
However, civil society organizations have been facing numerous challenges in taking public interest cases in courts including problems of locus standi and court expenses, and lack of expertise in discussing scientific aspects of the issues involved (particularly in environmental cases).

Concluding Notes

As shown by past initiatives, it is obvious that the country has realized the need to develop and implement responsible mining and to protect the environment from the adverse effects of mining operations. However, the public lacks participation in monitoring the implementation of relevant policies and regulations. More importantly, there is a lack of accountability mechanism for those who are violating the laws.
In this context, there is more work to do to address the damage to the environment caused by mining operations, and their (mining operations) adverse impact on the health, safety and livelihood of people in mining areas.

∗ This is an edited excerpt of the report with the same author and title in Bridging Human Rights Principles and Business Realities in Northeast Asia (Kuala Lumpur/Osaka: HURIGHTS OSAKA and SIRD, 2014).

The Centre for Human Rights and Development (CHRD), a human rights center based in Ulaanbaatar, has been supporting communities that were adversely affected by the mining operations in Mongolia.

For further information, please contact: Centre for Human Rights and Development (CHRD), Building of "Ok" centre, Youth avenue 13, 8th khoroo, Sukhbaatar district, Ulaanbaatar, Mongolia; Postal address: Central post office Box 551, Ulaanbaatar-211213; ph (976-11) 325721; www.chrd.org.mn.

Endnotes

1. Byambadorj Jamsran, Mining Sector Development and Human Rights in Mongolia, paper delivered at the International Conference on “Mining and Human Rights,” 10-11 October 2012 in Ulaanbaatar and organized by the National Human Rights Commission of Mongolia, page 2. Paper available at www.mn-nhrc.org/eng/main3/120/.
2. Jamsran, page, 7; Bayarsaikhan Namsrai, Cultural and Economic Rights of Herders as Related to Mining, 2012, paper delivered at the International Conference on “Mining and Human Rights,” page 3. Paper available at www.mn-nhrc.org/eng/main3/120/48-report.html.
3. Namsrai, ibid., page 2.
4. Appendix-1, Invest Mongolia Agency, official letter- information, 20 June 2013.
5. The text of the Minerals Law of Mongolia used in this report is from “Minerals Law,” Mongolian Mining Journal , http://en.mongolianminingjournal.com/content/38041.shtml.
6. Background, Mongolia Extractive Industries Transparency Initiative Secretariat, http://english.eitimongolia.mn/page/334.shtml?sel=607.
7. Paradox of Plenty is explained as follows: “Historically, several resource-rich developing countries have shown below-average growth performance and their citizens live in persistent poverty due to a lack of transparency and corruption caused by weak governance.” See World Bank, Extractive Industries Transparency Initiative: Results Profile, 15 April 2013, www.worldbank.org/en/results/2013/04/15/extractive-industries-transparency-initiative-results-profile.
8. Restatement of 10.6. Objective "Mongolia EITI capacity build-up" in the Mongolia EITI mid-term strategy (2010-2014), http://english.eitimongolia.mn/content/639.shtml.
9. See Stephens and Van Audit, op. cit.
10. This is an edited version of Namsrai’s list of root causes of human rights violations/abuses in the Mongolian mining industry, page 7.


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