Fiji
From Gold Town To Ghost Town
The Decline Of Vatukoula
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| Vatukoula has gone from a bustling center to a ghost town since the closure of the mine. PHOTO: BRUCE SOUTHWICK/ZOOMFIJI |
The shifts were just changing on the morning of December 5, 2006 at the Vatukoula gold mine in the north of Fiji’s main island, Viti Levu, when the shocking news was delivered.
The news wasn’t about the unfolding military coup in the capital Suva, some 380 km away. Instead, on the day Fiji marked its fourth coup in almost two decades and just weeks before Christmas, about 1,700 workers were stunned to learn they no longer had jobs.
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“It was shocking,” he says of the announcement by Australia-based Emperor Gold Mines (EGM) that it was shuttering the 75-year-old mine. Melton was sitting with a group of four others chatting quietly under a large tree in one of Vatukoula’s run-down company housing settlements when Pacific Magazine visited in January.
EGM’s controlling shareholder, South African mine operator Durban Roodepoort Deep (DRDGold), which holds 78.7 percent of EGM shares, says it decided to “call stumps” on the mine after a three-month review found that the project was no longer economically viable.
DRDGold’s then chief executive Mark Wellesly-Wood told a South African business radio program Classic Business Day that efforts to restructure the mine failed even after a new management team was recruited. He added: “We wouldn’t have taken this decision to support Emperor stopping the bleeding in Vatukoula if it wasn’t the right commercial decision—you don’t want value destroyers in your portfolio.”
Vatukoula General Manager Frazer Bourchier said in December the company had been losing F$5-7million (US$2.9-$4.1 million) a month, a sum it could not sustain.
In February Emperor indicated it was looking to sell the mine, after negotiations with the Fiji government broke down. Bourchier told local media that at least five companies were interested in the mine, and were undertaking due diligence processes. While the Fiji government offered to give the company a temporary exemption in its special mining lease so it could undertake further exploration programs in exchange for a trust fund for workers, this proposal wasn’t acceptable to Emperor.
A 15-minute drive down from the mine is Tavua, a township of 32,000 that was founded in 1935 on the promise of gold but which is now suddenly confronted with a frightening future.
“It’s a sad story,” says a despondent Mayor Chandra Singh, a lawyer who was born in Tavua and has lived there all his life. “The Vatukoula community exists because of the mine and if the operation closes, what’s left for it? This is a 75-year-old mine and you don’t just wake up one day and close it down.”
Singh lays most of the blame for the uncertainty of the town’s future on previous governments stretching back over the decades. He says the government failed to monitor the mine and ensure the operators met their obligations, while at the same time ignoring the precarious position the township was in because of the troubles at Vatukoula.
Former Senator Dr ‘Atu Emberson-Bain, a long-time miners’ advocate, in 2003 moved a motion to establish a Senate
committee to look into the long-standing problems of the Fiji mining industry. The motion was defeated but her landmark speech flagged the ongoing issues in the industry and especially at Vatukoula.
“Their tactics ranged from promises to tantrums. They wooed and they threatened. And there was always the same trump card to play. Whenever government did not succumb without a fuss, it would threaten to lay off its workforce and close down the mine. This threat, verbal or unspoken, always worked.”
The mine’s original union collapsed in 1977 after an unsuccessful strike. In 1989, the Fiji Mine Workers Union (FMWU) struggled to establish itself in the face of bureaucratic bungles and company resistance.
In February 1991, close to 500 workers went on strike protesting poor pay and working conditions. EGM immediately sought and was granted a court order declaring the action illegal and sacked all the striking workers.
Some eventually returned to work but in what’s billed by some unionists as one of the longest running industrial actions in history, the remaining FMWU workers still consider themselves to be on strike. To this day, 16 years later, the strikers take turns on the picket line just outside the main gate leading into the mine.
Josefa Sadreu, FMWU’s president is one of the original strikers. An affable man, he continues to fight the union’s case even after the mine’s closure. His latest quest was a submission to a taskforce set up by Fiji’s military chief and interim Prime Minister Commodore Voreqe Bainimarama.
“We’re very unlucky,” Sadreu, 49, says. “Since February 11, 1991, of the 500 members on strike, 30 have died, 15 families have been separated for good, we’ve had four (national) presidents, nine prime ministers, nine ministers for labor, and 370 of us are still on the picket line.”
The miners’ greatest hope for recognition of their plight was the 1995 Commission of Inquiry headed by prominent lawyer G.P. Lala. The government, then led by Sitiveni Rabuka, allocated $500,000 to carry out the inquiry, that subsequently upheld their complaints against EGM. But before Lala’s report was tabled in Parliament, EGM filed for a judicial review thereby suppressing its release. The case took nine years to come to court, and 12 years after the inquiry was concluded, the High Court ruled it had exceeded its terms of reference, was invalid and could not be tabled in Parliament.
Sadreu told the Vatukoula taskforce in late December that the FMWU believes the G.P. Lala report “to be the only true record of the reasons for the 1991 strike, particularly detailing the human rights abuses suffered by our members at the Vatukoula mines up to 1995, and which to a large extent, still continue today.”
Tavua’s immediate future now seems a little less gloomy with the approval by Cabinet in late January of F$600,000 (US$355,000) to fund a rehabilitation program for redundant workers.
Interim Labor Minister Bernadette Rounds-Ganilau says the program will be implemented over 12 months to help former mine workers to learn new trades or start small businesses.
About F$25 million (US$14.8 million) of EGM-generated cash used to be injected into Tavua annually. “That’s a substantial amount for a small economy,” says mayor Singh. “Now that’s no more.”
Prakash, who runs a restaurant and who, with her husband owns two properties in the town, shakes her head as she describes how difficult it’s become to keep up with the mortgage payments.
“We’ve gone from gold town to ghost town,” she says with a nervous laugh.
Her husband’s family have all migrated. Her two daughters are studying in Australia, while her son remains at home.
“My husband has always wanted to remain here but I think this will change his mind.”
Satish Chandra, the general secretary of a separate union, the Mine Workers Union of Fiji representing 800 hourly-paid workers, feels that a solution must be found fast to prevent the community disintegrating.
“When it gets hot, it’s going to get really hot,” he says, suggesting that social problems and the crime rate in the area could increase if nothing is done about the unemployment.
If the miners—Vatukoula’s main victims—are bitter and despairing, it doesn’t show.
“We like to sit like this, talk and encourage one another,” says one of Melton’s colleagues with a wide grin.
Another jobless man joins the group. “We’re all in the same boat,” somebody quips while welcoming him. “And it’s a very big boat,” adds Melton.
