Pygmies pin hopes on resource-hungry China

The pygmies of Gabon's lush northeast equatorial forests may soon be learning Chinese.

Buried deep in thick jungle in the least populated corner of the oil-producing central African state is one of the world's biggest untapped reserves of iron ore, waiting to be developed.

But the country selected by Gabon to help exploit the huge Belinga iron ore deposit is not former colonial ruler France, or any other resource-gobbling Western industrial power.

The chosen partner is China, the newest and hungriest raw materials raider on the African continent.

The Belinga deal in Gabon is only the latest of a string of multi-billion-dollar energy and commodities contracts secured by the Asian economic giant to feed its ravenous economy. China is the world's top steel producer and biggest importer of iron ore.

After years of stagnation and neglect, people in and around the isolated Gabonese village of Belinga, surrounded by virgin forest, are agog with expectation about the arrival of the Chinese and how this can improve their lives.

Although the consortium chosen to develop the mine, led by state-owned China National Machinery & Equipment Import & Export Corp., is only just starting its work on the ground, locals are expecting a windfall in jobs and other economic benefits.

"All of the people's hopes are riding on the exploitation of the Belinga iron ore deposit ... the people are waiting for the work to get going," said Andre Nkoghe Ella, mayor of Makokou, the regional capital, around 110 km (68 miles) from Belinga.

The Chinese group plans to begin work this year and complete the project in three years. The Belinga deposit is reported to have proven iron ore reserves of more than 500 million tonnes.

The $3 billion total investment - about the level of Gabon's annual budget - foresees construction of a 560 km (350 mile) railway to carry the ore to Cape Santa Clara on the Atlantic coast, a bulk commodities and container port there and two hydroelectric power stations.

At the moment, the journey from Makokou to Belinga is either a muddy drive through hills on a dirt road or a more leisurely motor canoe trip up the Ivindo river, between banks choked with tropical foliage and teeming with game.

Local inhabitants, including pygmies living in neighbouring forests, eke out a meagre living by hunting, fishing or cultivating crops.

"There's everything to be done in this almost forgotten area - roads, electricity and even running water," says boatman Firmin Tcheka, 41.

It was the Chinese group's promises to tackle all of the basic infrastructure required to make the project work that won them the Belinga contract in the face of tough competition.

Brazilian mining giant Companhia Vale do Rio Doce (CVRD) and French nickel firm Eramet had originally been part of the consortium eyeing Belinga.

But they pulled out because they were unwilling to bear the cost of building the accompanying infrastructure in such a remote, undeveloped location more than 500 km (300 miles) east of Gabon's capital, Libreville.

The Chinese consortium picked for Belinga includes state-owned Export-Import Bank of China, which like its US, European and Japanese counterparts, helps finance its country's firms overseas.

Many African governments like the no-strings-attached approach of the Chinese, who offer aid or loans not linked to demands for good governance, transparency or improvements in human rights - the Western recipe for development packages.

"When the Chinese come they can provide financing, without a lot of strings or moralising," said a Gabonese government adviser when he accompanied President Omar Bongo on a visit to Beijing in November.

"They say, 'the Europeans will come with a lot of conditions, but we won't interfere'. That's very attractive to governments here," the adviser added.

Underpinning the Belinga project are more than three decades of cordial ties between Bongo, Africa's longest serving ruler, and China.

The two countries established diplomatic relations in 1974 and Bongo has visited China at least 10 times. Chinese companies have constructed roads and public buildings in Gabon and are also mining manganese and exploring for oil and gas.

Bongo hails the Belinga iron ore venture as "the project of the century" and has made clear he expects it to create thousands of jobs for his people.

Sensitive to suggestions that China might import its own technicians and skilled labourers to carry out the project, China's ambassador to Gabon, Xue Jinwei, says there should be more than enough jobs to go round - perhaps 20 000 or more.

"We're talking about a big project that includes the construction of a port, a railway, dams and the exploitation of the mine itself. That's a big job that is going to need a lot of people," the ambassador said.

In anticipation of finding work, miners who once worked at a now closed uranium mine at Mounana in the southeast of the country have travelled north to Belinga.

Once in operation, the Belinga mine will sell all its iron ore to Chinese steel mills.

China's hunger for iron ore has grown as its industry churns out steel for the ships that carry its exports, for the cars that crowd its roads, and the skyscrapers that crown its teeming cities.

But in the hamlets and villages around Belinga, the expectations are more modest.

"I hope that the Chinese can build a nice school, a library with lots of books," said Nicolas Essone, aged 8, one of several barefoot children studying at Belinga's mud-hut school.

source news : miningweekly.co.za