Revised July 2009

December 20 2007

Mr. John Mihevc
Chair, Halifax Initiative Coalition
153 Chapel Street
Ottawa, ON KIN 1H5

Dear Mr. Mihevc:

Thank you for your correspondence of January 31, 2007 outlining recommendations for our Annual Report to Parliament on Bretton Woods Institutions. Your feedback helps maintain the Department of Finance’s high standard for accountability in managing Canada’s relationship with the International Monetary Fund and the World Bank.

Guatemala
Glamis Gold Ltd.
IFC: US$45 million loan
CPP: $63 million[1]

Marlin, which became operational in 2005, is the first major mining investment in Guatemala in 20 years[2] and is an important test case. In January 2005, the break-up of a 40-day protest by the army resulted in one death.[3] Later that year, indigenous Sipacapan communities affected by the mine overwhelmingly rejected mineral development in a popular referendum.[4] In response to a community complaint, the World Bank’s Compliance Advisor Ombudsman (CAO) investigated the project. While the CAO found that some community concerns, particularly those involving impacts to local water supplies, were unwarranted, the CAO identified some serious shortcomings with project assessment and management. For example, the CAO described the lack of a clear policy on human rights as a “significant oversight” on the part of both Glamis and the IFC.[5]

Democratic Republic of Congo

Anvil Mining Ltd.
MIGA: US$13.3 million political risk insurance[1]
CPP: $4 million[2]

Brutal conflict, fuelled by the country’s extraordinary mineral wealth, officially ended in 2003 with the establishment of a transitional government. While a fragile peace has held since then, tensions remain high and the government lacks control over large tracts of the country.[3] The Dikulushi mine began production in 2002. Two years later, Anvil provided logistical support to the Armed Forces of the Democratic Republic of Congo (FARDC) to suppress a rebel uprising. The company supplied the FARDC with planes, vehicles, personnel and food.[4] According to a UN mission, the FARDC utilized these resources to carry out a number of human rights abuses, including alleged summary executions.[5] 

Bolivia
Orvana Minerals Corp.
IFC: issued loans to and held equity in COMSUR,[1] a Bolivian company that was an Orvana shareholder until 2005[2]

The Don Mario mine is located in the heart of the Chiquitano Dry Forest.[3] This rare, globally significant ecosystem supports the headwaters of the Pantanal wetlands and is home to numerous endemic species.[4]  The Pantanal is one of the world’s largest freshwater ecosystems, recognized by UNESCO and the Ramsar Convention.[5]  The area is also of great cultural, economic and social importance to the Chiquitano indigenous people.[6]  In a complaint filed with the World Bank’s Compliance Advisor Ombudsman, an indigenous organization argued that the mine violates the rights of over 7000 indigenous communities.[7] Among other shortcomings, the ombudsman found that indigenous people were not adequately consulted by the project proponents.[8]

Tanzania

Sutton Resources Ltd. Mine acquired by Barrick Gold Corp. in 1999.

EDC: $173 million political risk insurance[1]

MIGA: US$172 million guarantees[2]

CPP: $351 million[3]

Bulyanhulu is among the most controversial Canadian mining operations in the world.  Artisanal miners were forcibly evicted from the concession area by Tanzanian troops in 1996 when the concession was held by Barrick’s predecessor, Sutton Resources.[4] A storm of allegations surround the evictions including one that as many as 52 miners were buried in mine shafts.[5] Barrick denies these allegations. A former Tanzanian Attorney General and an international team of researchers, lawyers and NGOs have called for an independent inquiry into the evictions.[6] The World Bank Compliance Advisor Ombudsman (CAO) found that the evidence regarding the alleged deaths was unconvincing and did not recommend an independent inquiry, deferring this decision to the Government of Tanzania.[7] No inquiry has been held, and the CAO report has been widely criticized by NGOs.[8]   

Declaration on the Rights of Indigenous Peoples Adopted
On June 29, the Human Rights Council – the new United Nations Human Rights Commission – finally adopted the Declaration on the Rights of Indigenous Peoples, twenty-two years after it was first drafted by the UN Working Group on Indigenous Peoples.

Is Wolfowitz Gathering his Forces?
On June 16, 2006, former Spanish Foreign Minister Ana Palacio was appointed Senior Vice President and World Bank Group General Counsel. Ms. Palacio’s appointment is perhaps not surprising given her support for the US-led invasion of Iraq.  Her role under Spanish Prime Minister Jose Maria Aznar’s government in fact was essential to establishing good ties with the US.  But at the same time, her appointment is controversial because she continues a legacy of appointments made by President Paul Wolfowitz of a few close, like-minded allies that are forming an inner cabinet, and ostracizing other long-time and upper-level staff members from Bank decision-making (See Issue Update Vol 2, No. 1, 2006).  The appointment has sparked public debate on how senior management posts are filled.

Background | Roundtable Process | When and Where | How to Participate | Monthly Updates

Background
The Parliamentary Standing Committee on Foreign Affairs and International Trade (SCFAIT) tabled, in June 2005, a landmark report on Mining in Developing Countries and Corporate Social Responsibility (CSR).

The report recommended that the Canadian government move away from its current voluntary approach to CSR. It called for policies that condition public assistance for Canadian companies on compliance with international human rights and environmental standards, including core labour rights. The report also identified the need for legislation to hold companies accountable for their actions overseas.

The Government failed to adopt the majority of SCFAIT’s recommendations, but it did commit to hosting a series of national roundtables. These Roundtables were to identify ways for Canadian extractive companies to meet or exceed international CSR standards and best practices.