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Former workers from this mine in Eritrea, operated by Nevsun, claims forced labour has been used in construction work. Photo: Nevsun

Pension Fund Company accused of Forced Labour

The Canadian mining company Nevsun is accused of profiting from forced labour. The Norwegian Government Pension Fund – Global has invested NKR 74 million in the company.
Artikkelen er mer enn to år gammel. Ting kan ha endret seg.
The Canadian mining company Nevsun is accused of profiting from forced labour. The Norwegian Government Pension Fund – Global has invested NKR 74 million in the company.

The Norwegian Government Pension Fund – Global has invested heavily in Nevsun, whose gold mine installations in Eritrea have been built with forced labour, according to several construction workers who have fled the country. Their allegations receive support from the organisation Human Rights Concern Eritrea.

Nevsun has used state companies as subcontractors at the Bisha mine in Eritrea, and the state companies use soldiers as very cheap manpower under hair-raising work and safety conditions. Human Rights Concern Eritrea claims that forced labour is still taking place at Nevsun’s mine in the country. Nevsun denies these allegations.

In Eritrea all men and women between the ages of 18 and 50 years must perform military and civilian service and are kept mobilised for years. The country is kept indefinitely mobilised after the border conflicts with Ethiopia and Djibouti, and the soldiers have received no promise as to when they will be demobilised. The soldiers are used as cheap manpower by state companies in the mining sector, construction work, agriculture and so forth (see below). The practice has been thoroughly documented by organisations such as Human Rights Watch.

It is conscripted soldiers such as these who are supposed to have been used by the state subcontractor Segen at the Bisha mine.

About 1000 soldiers were used in the construction work at the Bisha mine that Canadian Nevsun – in which the Pension Fund has invested 74 million kroners – today owns together with the Eritrean state. The soldiers were forced to work 16 hours a day, had to sleep on dirt floors and received a minimum of food, former workers related. Their wages were 10 US dollars a month, whereas regularly employed Eritreans received approximately 30 US dollars monthly. Threats, informing and fear characterised the relationship between the workers and their employers. The quality of the food and the water was terrible, and the workers never had enough food. In addition, they worked in extreme heat, whereas at night it was biting cold.

Read more about the conditions in Eritrea in our report “The Pension Fund Profits from Gold Rush in Eritrea”.

Shocking Accounts

The Future in Our Hands has had access to an interview with a former construction worker, Abadi Ghebremeskel, who managed to escape from Eritrea in the spring of 2011. Ghebremeskel furnished details of the mining production and construction work that only a former employee could have knowledge about. He has also identified himself on a photo of the construction work that Nevsun has published on its website. A summary of the interview can be seen at the website of Human Rights Concern Eritrea.

Abadi Ghebremeskel worked for several years for the Eritrean state construction company Segen. At the Bisha mine he had responsibility for teaching the workers about job safety and therefore worked closely with those responsible for safety at Nevsun and the South African mining company Senet.

Nevsun started production of gold at Bisha in 2011 after several years of construction work.  After a few years of gold production, they wanted to extract copper and zinc from the same mine. The construction of a new copper production plant has started, and the company secured new exploration licenses for itself in June of 2012. The company’s income from gold production during the first 6 months of 2012 was a little less than US$300 million.

The gold mine in Bisha is owned by Nevsun (60%) and the Eritrean state (40%). The profits from the mine have become the government’s probably most important source of income. The UN has expressed concern that the mining industry provides the extremely controversial regime in Eritrea with the income necessary to finance rebellious groups in neighbouring countries and destabilise the region.

The Pension Fund owns shares worth NKR 74 million in Nevsun and now owns 1.12% of the shares. “An unacceptable risk of contributing to serious or systematic human rights violations, such as murder, torture, deprivation of liberty, forced labour…” are, according the Pension Fund’s ethical guidelines, grounds for withdrawing from a company. Ola Mestad, Chair of the Council on Ethics for the Pension Fund, confirms to the Norwegian Broadcasting System Radio that he is familiar with Nevsun’s mining activity in Eritrea. Nevertheless, the Pension increased its investment in Nevsun from NKR 41 to NKR 74 million during 2011.

Confirms Allegations

Conscripts in Eritrea are caught in an often indefinite compulsory service, with a monthly wage of less than 10 dollars and miserable work conditions. During the start-up of the mine, which is operated by Nevsun and South African Senet, the Eritrean company Segen contributed with construction of roads and barracks and other infrastructure. Several of Segen’s workers are supposed to have been conscripts forced by the state to work for the mining companies.

Elizabeth Chyrum, the director of Human Rights Concern Eritrea, can vouch for Ghebremeskel’s claims. “We consider the information on use of forced labour 100% reliable,” London-based Chyrum stated. She herself has interviewed seven Eritreans who have worked in the mining sector and confirms the use of forced labour. Her organisation has carried out several more interviews of refugees who confirm the allegations.

Ghebremeskel fled Eritea in the spring of 2011, at a time when Segen’s contract assignments were in the process of being terminated. He is now living in a refugee camp in Ethiopia. According to Chyrum, use of forced labour by state companies is still taking place in Nevsun’s mines. After Ghebremeskel’s flight, the company has started new construction work and secured new exploration areas near Bisha.

Refutes Allegations

Nevsun refutes the allegations of forced labour. The company wrote to The Future in Our Hands that they require documentation that all workers at the plant and at subcontractors have completed their compulsory military service before they work at the mine. “Senet, which has been in charge of the construction work (which is now completed) required that this policy be implemented by all subcontractors, including Segen, and the Bisha mine has now been positively evaluated in line with this,” the company wrote in an e-mail.

“This is outside Nevsun’s control,” Elizabeth Chyrum says. She believes that even though the company wishes to avoid forced labour, the company is fooled by, among other things, the fact that the soldiers have to wear civilian clothes.       
In the interview Ghebremeskel described how the authorities did their best to fool the foreign companies so that they would not discover the use of forced labour. In addition, special soldiers from the intelligence service mingled with the rest of the conscripts and ensured that they did not inform to the international workers. According to Ghebremeskel, they were also supposed to be armed. Two military brigades are supposed to have been deployed around the mine area for security, but these soldiers were not allowed inside the mine area.

On query as to whether they can have been fooled, Nevsun answered in an e-mail that they have full control over who works at the mine and that  it would not be possible to fool the company in the manner described by Ghebremeskel. “Bisha is a remote mine, surrounded by a fence and with only one entrance.  No “battalions” and no workers at all can get into the area without going past the security control, which makes it possible to implement our procedures [to check the workers].”

A hint from Wikileaks

Even though Nevsun dismisses the claim that military units are present at the mine today, it is confirmed by a former employee in conversations at the American embassy in Eritrea, leaked by Wikileaks. After the murder of three mine workers in 2003, “Eritrea’s government gave Nevsun a security team of 2000 persons, permanently stationed in the Bisha area”.

Another report from the American embassy in Asmara from 2006 describes how Nevsun and the Eritrean state collaborated closely. The embassy refers to a meeting at which Eritrea’s government together with representatives were to inform visitors from the UN Commission and the World Bank about investment possibilities in Eritrea: “Eritrea’s government and Nevsun gave a performance worth an Oscar,” an embassy employee wrote.

In 2009 the respected human rights organisation Human Rights Watch published a report on the use of forced labour in Eritrea, “Service for Life”. The report describes extensive use of conscripted soldiers in several important economic sectors, including mines, agriculture and infrastructure.

The Future in Our Hands has asked Human Rights Watch whether there is any validity in the allegations about the use of forced labour:

“We are seriously concerned that forced labour may have been used at the Bisha mine in Eritrea. We believe that Nevsun has not been able to demonstrate adequately that forced labour has not been utilised,” says Senior Advisor Ben Rawlence, who is following the development in Eritrea closely. “I believe it would be unwise of Nevsun to deny categorically that forced labour may have been used. I can not understand how they can be so certain about this, on the basis of what I know about how the mine is operated.”   
According to Rawlence, it is impossible to obtain neutral and independent investigation of the claims about the use of forced labour, since there is no free press. Foreign diplomats, independent investigators and Eritreans themselves are not allowed to leave Asmara and freely visit other parts of the country. In Reporters without Borders’ annual Press Freedom Index, Eritrea was the worst of the 178 countries listed, even worse than North Korea. It is therefore impossible to verify the claims about use of forced labour in the mining industry.

Indefinite Conscription

Eritrean society has been mobilised for war more or less since the border war with Ethiopia in 1998-2003. The authoritarian president, Isaias Afewerki, and the military have full control of society and the economy. Conscription applies to both women and men from 18 to 50 years of age and is described as “indefinite conscription” since the soldiers are never demobilised. On the contrary, the soldiers are utilised actively as cheap labour by state companies, at a “wage” of about 10 US dollars a month.

In the construction industry the state companies are omnipotent after the government withdrew licenses to operate from the private construction companies. Segen, the state company that has provided services for Nevsun, is one of the companies charged with extensive use of conscripts in construction work.(*) The mining companies benefit from the use of conscripts since they use state construction companies for infrastructure such as road construction and construction work at the mines.

Human Rights Watch interviewed a large number of refugees from Eritrea for its report on forced labour, and several of them mentioned the mining sector: “Others [refugees] described working on farms or mines owned by the state or the PFDJ ruling party, or building roads and bridges. Regular military units, conscripted military personnel, and prisoners are all also engaged in similar activities – building, mining, and farming.”

At the Bisha mine there was, according to Abadi Ghebremeskel, a definite hierarchy among the four groups working there:

a)    Foreign workers from South Africa and Zimbabwe hired by the mining company Senet, with good wages, living conditions and food.
b)    Privileged Eritreans hired directly by Nevsun, with relatively good wages and working conditions.
c)    Regular employees in three state companies that provide services such as infrastructure, roads, housing and so forth – including Abadi Ghebremeskel.
d)    Conscripts working as slaves for the state companies.

In contrast to the foreign workers, who were transported to work by buss, the conscripts were transported by mining trucks. They had to bend down and keep out of sight when passing foreign workers, Ghebremeskel relates. Fear and suspicion prevailed among the workers, since many workers probably operated as spies and notified the regime. Anyone who talked to the foreign workers was under suspicion. It is prohibited to talk about slave labour, work safety, or sabotage that has occurred outside the camp.

Youth Put to Flight

The extensive mobilisation and the use of conscripts in social service are some of the most important reasons that youth flee the country. In 2010, refugees from Eritrea constituted the largest group of asylum seekers in Norway, even though the country has only 5 million citizens. The general conscription applies to both men and women above the age of 18 years. After 6 months’ military training they are transferred to so-called civilian service.

In practice the civilian service may last indefinitely: “The criteria for demobilising were unclear, and many were required to work indefinitely in any location or capacity chosen by the government,” according to the American Department of State’s Human Rights Report for 2010. Eritrea’s president still keeps the country mobilised because of the unsettled border conflict with Ethiopia in 1998 and 2000. In 2008 a new border conflict with Djibouti started.

A summary of the interview with Abadi Ghebremeskel is available at the website of the London-based organisation Human Rights Concern Eritrea.

Nevsun’s website contains extensive documents showing demands for the health, environment and safety of their employees, in stark contrast to the reality former employees have described.

The Pension Fund’s Ethical Guidelines on Forced Labour

The Norwegian Government Pension Fund – Global has its own ethical guidelines which establish that the fund should not “make investments which constitute an unacceptable risk that the Fund may contribute to unethical acts or omissions, such as violations of fundamental humanitarian principles, serious violations of human rights, gross corruption or severe environmental damages”.

Exclusion of companies is one of three defined measures to promote the ethical guidelines. According to the guidelines, companies will be excluded “ if there is considered to be an unacceptable risk of contributing to serious or systematic human rights violations, such as murder, torture, deprivation of liberty, forced labour, the worst forms of child labour and other child exploitation”.

(*) Gaim Kibreab, “Forced Labour in Eritrea,” Journal of Modern African Studies, vol. 47, no. 1 (2009), http://www.ehrea.org/force.pdf (accessed August 8, 2011), p.60