US Financing Supplier of Africa Mines Accused of Slave Labor
The US government’s export credit agency has provided hundreds of millions of dollars in taxpayer-backed financing over the past decade to a supplier of equipment to African mines accused of slave labor, human rights and environmental crimes.
The Guardian reports the Export-Import Bank of the United States (EXIM) has provided $315 million in financing in the form of 48 insurance policies to Connell Company, a Berkeley Heights, NJ-based real estate, hospitality, mining, finance and equipment leasing conglomerate dealing with at least 17 mining companies in seven sub-Saharan African nations, between 2007 and 2015. This includes a $20,000 policy for mining equipment for the Bisha cooper mine in Eritrea, which is the subject of a slave labor investigation by a Canadian court.
Canadian officials have long known about allegations of slavery at Bisha, where Vancouver-based Nevsun Resources is the majority owner. In a 2012 email to colleagues, Canadian consul to Ethiopia Christopher Hull wrote of mining companies “being forced to use conscripts and prison labor.” Last October, the Supreme Court of British Columbia rejected Nevsun’s efforts to dismiss a lawsuit filed by Eritreans who allege they were forced to work at Bisha. This is the first time a mass tort claim for modern slavery is proceeding in a Canadian court, and the first time a case against a mining company accused of foreign abuses has been permitted to proceed in British Columbia.
“The case alleges that military intelligence forces actually operated inside the mine and detained and disappeared people working at Bisha, and that several conscripted laborers were tortured,” Matt Eisenbrandt, legal director for the Canadian Center for International Justice (CCIJ) and a member of the legal team representing 29 men and a woman who claim they were forced to work at the mine, told the Guardian.
In a 2006 diplomatic cable published by the whistleblowing website Wikileaks, US ambassador to Eritrea Scott DeLisi noted how Segen Construction, a Bisha subcontractor owned by Eritrea’s ruling political party and employed by Nevsun, beat all of its competitors to grow into the country’s largest construction firm. DeLisi wrote Segen’s main advantage was that its labor came at “nearly zero cost.” That is because, critics allege, the Eritrean army and state-run contractors are forcing military conscripts to work under abhorrent conditions in the National Service, a program the government uses to enslave its own citizens.
“The financing that Connell is getting is quite significant,” Doug Norlen, director of economic policy for Friends of the Earth U.S., told the Guardian. “Whether it’s loans or insurance, the same obligations exist to carry out human rights due diligence. Some of these projects are associated with some pretty serious human rights abuses.”
EXIM has also insured export deals between Connell and numerous mining firms in the Katanga region of war-torn Democratic Republic of Congo (DRC). The Amsterdam-based Center for Research on Multinational Corporations (SOMO) has detailed extensive environmental and human rights violations, including poisoning of drinking water and exposure of thousands of people to toxic fumes and dust, noise, and effluent water generated by the cobalt mines, trucks and processing facilities. “Chronic exposure to such dust can lead to potentially fatal hard-metal lung disease. It can also lead to a variety of other pulmonary problems, including asthma, decreased lung function, and pneumonia,” a 2016 SOMO report stated.
During President Barack Obama’s tenure, the administration spent $34 billion through EXIM funding some 70 fossil fuel plants and projects, contaminating air, land and water in countries around the world and exacerbating the global climate crisis.
Caroline Scullin, EXIM’s senior vice-president for communications, told the Guardian that short-term insurance deals are not subject to environmental and human rights due diligence procedures. “Short-term insurance does not cover projects per se; rather, it generally covers goods that are not capital in nature or destined for new projects,” she explained.