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Inclusive Growth to Help Communities Live “Better Lives”

At Myanmar Wanbao, we are committed to a good relationship with the communities that we live amongst.

This relationship begins with meeting our legal obligations, and grows from there to consideration of how we can assist and support the villagers, to live, as President U Thein Sein has put it, "better lives".

We have noticed that some members of the media seem confused about land compensation, subsidy, and the contribution payment. Accordingly, we would like to explain this in detail and we hope you have patience to read to the end.

contribution4

 

Land compensation/subsidy

 

The legal land compensation is a consequence of obtaining the legal right of access to the land the mine needs. This is a legal right obtained by foreign investors according to Myanmar law, and it is to be protected by government by law. The compensation is 100% completed.

Since 2011, we paid land compensations and three times of land subsidies to the land-lost people in the project area. The criteria for the land compensation or subsidies was not decided by Myanmar Wanbao but by the Myanmar government, based on the Myanmar law and Myanmar local market price for the land.

 

1. The land compensation and first subsidy in 2011:


The land compensation was 12 to 20 times revenue is legal for compensation. But that amount is very little, only 5 to 20 kyats. The compensation committee set up by the government to settle this matter considered two alternatives for land subsidies. One was to give the subsidies according to the local average current price of land. The range of land prices in the area was about 200,000 Ks to 400,000 Ks. The second route they considered was to give the additional subsidies depending on the type and selling price of the crops for a multiple of three years of profit. This resulted in a price of about 525,000 Ks to 550,000 Ks for one acre. The latter route was adopted by the government and the first subsidy was paid to the land-lost villagers in addition to the land compensation. All of the land-lost villagers claimed the land compensation and the first subsidy with a total sum of 4.18 billion Ks.

 

 

2. The second land subsidy starting from March 2013


The Investigation Committee, headed by Daw Aung San Suu Kyi, produced a report on the Letpadaung copper project in March 2013. Their Investigation Report recommended that the land compensation should be increased. The Implementation Committee, created to carry out the recommendations of the Report, worked out the criteria for the second land subsidy as follows:

 

Sr No.

Field irrigated by Canal (Kyats)

Field Irrigated by rain (Kyats)

Dry land (Kyats)

 

1,500,000

1,200,000

1,000,000

 

By Mid-November, 2014, 66% of total people who have lost land to the project area have taken up the second-time land subsidies. The total sum paid is 3.97 billion Ks. This is a significant number, since it means that the majority of villagers losing land are willing to release their land to the project. This seems a solid statistic, suggesting public opinion is behind the development of the Letpadaung project. The compensated land area, of the 66% of land-lost villagers, covers 59% of the total project area, again, a majority.

 

3. The Third land subsidy starting from February 2014


The Implementation Committee, after listening to the public for raising the criteria for the land compensation, on February 3, 2014, announced the payment of a third subsidy for the lost land based on the following criteria:

 

Sr No.

Irrigated farmland(Kyats)

Registered dry land(Kyats)

Unregistered dry land(kyats)

 

1,200,000

800,000

300,000

 

So in total, land-lost villagers are entitled to have between 1,825,000 Ks and 3,250,000 Ks depending on the type of the land and based on the criteria that the Myanmar Government formulated.

 

Contributions payments starting from July 23, 2014


After carrying out an extensive community consultation in May 2014, we identified then that due to the delay in the operational phase of the mine due to the stoppages the Letpadaung project faced, land-lost villagers had become frustrated waiting for the jobs we had promised them. We had promised that every villager who has lost up to 10 acres would receive one job, villagers who have lost between 10-20 acers would receive two jobs, and those losing above 20 aces would receive three jobs. This was agreed in July 2013. However, the delay in the mine construction meant we could not provide these jobs, due to the stoppages which were outside our control. So we decided to support those families through a "contribution payment" system which was based upon the original jobs criteria. The Contribution system was designed with advice from British Consultancy China-I/Myanmar-I. The contribution payment is paid "in addition" to the compensation payments.
Our response has been shaped by international best practice on livelihood needs, and the expectations of our neighbours, and from a simple basic respect for human rights. For such villagers, we have developed what we believe to be a fair solution.

contribution2
For such villagers, we have committed to paying an annual "contribution" to villagers: between USD70 and USD160 per month depending on the number of jobs they are entitled to because of land loss. This "contribution" will take two forms. One is back-dated pay, this depends on the time villagers signed up to the second compensation until July 2014. This way, this covers the past period villagers had been waiting for a job. The second form this "contribution" is "forward looking" and covers the future period whilst they wait for their job to materialise.
We have set up bank accounts for the villagers through KBZ Bank to receive these payments directly into their personal accounts. All villagers wanting the contribution are issued a savings book also from KBZ.
All of the land-lost villagers are entitled to enjoy the contributions. The resettled villages in particular get an additional job per household.

contribution3

 

The landless


There are some landless people in the project-affected villages who also need to be taken account of. The "landless" refers to those who have no farmland but depend on the big landlord to make a living by working as a labour. In some cases, that landlord, often from the same village, has also lost their farmland to the project area, and these landless lose their means of living. That's why these "landless" should be given special consideration.

The number of the landless and also their identity are still being identified by the regional and local government – the true status of its citizens is ultimately a government responsibility. When firm numbers are available, a special policy to assist the landless can be worked out.

At the moment, the action is this: according to a decision made by the regional government, the government will organize training for the landless to help them secure livelihood skills, and we at Myanmar Wanbao will provide a fund for the training. More than 11 million Ks have been put to the training of mechanical and electrical skills for around 140 trainees from impacted villages since August, 2014. After obtaining the skills, these villagers will have a better chance to get jobs. We will continue this work with the regional government in the training of the landless to help them get equipped with livelihood skills to end their poverty and vulnerability.

 

Village consultations

 

Since July 23, 2014, we have been engaged in village consultations together with our partners MEHL and ME1, supervised by the regional and local government, and also observed by British risk management consultancy Myanmar I/China-I.

These take different forms; group meetings with a large proportion of the village, meetings with smaller groups, and door-to-door visits by teams of two or three to individual households. We have used the group meetings for public announcements; such as the contribution plan, and the plan to support villagers in starting SMEs. The more intimate door-to-door visits are for the purpose of detailed consultations, often guided by a questionnaire to gather the much-needed data on villagers' true conditions.

By November 20, 2014, we have consulted 634 villagers with lost land, from 27 villages. With 575 of these agreeing to accept the Contribution Plan, the acceptance rate amounts to 91%.

 

Summary


We have invested in road repairing and construction of new roads, clean water supply and storage, electricity provision, supporting the provision of education for all ages of children, village clinics that have so far had 80,000 individual visits, vocational training to improve skills, and so on. We have provided all of this – as well as met our legal obligations set down by the Myanmar government – despite the situation that the Letpadaung project has yet to start operation, and has no economic returns.

 

The government mandated first land compensation is 100% completed.

 

The Second Land Subsidy has been taken by 66% of land owners.

 

The contribution plan has 91% take-up in 27 villages we consulted through door-to-door visits.

 

These numbers are considered by International Best Practice to have exceeded the requirements for majority acceptance of the mine project.

We are proud to be in the forefront of showing how a mining company should engage with its host community.

We do all this out of a genuine wish to be a good neighbor, to be an integral part of the local community. Those of you that take notice of such things, we are certain that you will see that this is far beyond the strict legal requirements, beyond our contractual obligations, and even beyond the standards of international poverty-alleviation. This is because we truly care for our neighbours, and will continue our duty of care towards them for the life of the project.