Collaboration for responsible development of port and mining facilities in Southern Madagascar

1. Collaboration for responsibledevelopment of port and mining facilitiesin Southern Madagascar World Bank, Washington October 9th, 2007

2. Discussion Points • Background • Construction of infrastructure, mine & port • Social Issues • Land acquisition, Community, HIV/AIDS/STDs, Collaboration with PIC • Environmental Issues

3. Discussion Points • Background • Construction of infrastructure, mine & port • Social Issues • Land acquisition, Community, HIV/AIDS/STDs, Collaboration with PIC • Environmental Issues

4. Anosy Region and Project Location

9. ~ 1 110 000 Tpy Mine Flowsheet MSP Rutile 15 000 Tpy 25 000 Tpy 750 000 Tpy

10. 9 8 10 7 RN 12 1. Existing Harbor 2. Project Office 3. Villages 4. Quarry RN 13 5. Quarry Haul Road 2 1 6. Port 4 3 7. MSP Haul Road 8. MSP AIRPORT 9. Conservation Area 5 10. Weir 6

11. Discussion Points • Background • Construction of infrastructure, mine & port • Social Issues • Land acquisition, Community, HIV/AIDS/STDs, Collaboration with PIC • Environmental Issues

12. Discussion Points • Background • Construction of infrastructure, mine & port • Social Issues • Land acquisition, Community, HIV/AIDS/STDs, Collaboration with PIC • Environmental Issues

13. Primary focus areas • Resources / Partnerships • Health • QMM, Community & HIV/AIDS/STDs • Land Acquisition & DUP Process • Employment • Testing, training & local recruitment • Local procurement & SMEs • Migration & Inflation Management • PIC/Government Cooperation

14. Communities Communities affected by the Rio Tinto/QMM project

15. Resources / Partnerships • Partnerships: • Education – Clairefontaine, CISCO, UNDP, UNICEF • Health – USAID, PSI, Local Communes • HIV/AIDS/STDs – USAID, GTZ, CNLS, PSI, Int’l HIV/AIDS Alliance • Malaria – PMI, USAID, CNLP • Training – UNDP, PIC, Min. of Education, USAID • SMEs & Micro-Financing – USAID, ICAR, BNI, Région • Urban Sanitation – CARE, PIC, World Bank, Région • Power, Potable Water, Solid waste – PIC, World Bank, Min. of Energy & Mines

16. Health • QMM: • Health within the QMM organisation • Recruitment of Int’l SOS and establishment of a clinic for employees and their dependents at the permanent camp • Protocol, procedures and partnerships for the reduction and prevention of malaria, as well as common intestinal ailments • Partnership with GTZ and CNLS for the prevention of HIV/AIDS/STDs within QMM and contractor organisations

17. Health • Community: • Community Health Objectives 2006 though 2008 • Ensure the effectiveness of prevention programmes for relatively frequent ailments and diseases in FtD (e.g. malaria and mosquito-borne diseases, dysentery, infantile diarrhea, et al) • Contribute to regional public health support (building capacity) • Direct community investments (community clinics) • Continue to promote public health in neighboring communities (direct community investment)

18. Health • HIV/AIDS/STDs: • Follow-up action on HIV/AIDS/STD prevention: • In partnership with: Int’l HIV/AIDS Alliance, GTZ, PSI, UNDP • Training of peer educators: 14 employees trained to date, with refreshers and more in-depth training planned. • HIV/AIDS/STD training consultant: Peter Adams • Implementation of the CLLS plan (Local HIV/AIDS awareness and prevention council) • Capacity building for CSW Association • Direct community investments (VCT clinics: 3 in place and 1 pending) • Voluntary testing campaign, including QMM management in October 2007

19. Main Community Health Partners w/ Region w/ PIC support

20. Land Acquisition & the DUP Process • DUP (Déclaration d’Utilité Publique): • In the context of the resettlement process • payment of financial offsets for land and crops to 492 Fort-Dauphin area residents affected by port and road construction • Process fully compliant with World Bank guidelines • Disbursements of US$ 4 million (MGA 8.2 billion) in 2007 • implementation of the resettlement action plan (RAP): construction of homes, implementation of related social programmes and accompanying measures. • establishment of an objective settlement and claims settlement committee (CRL)

21. Land Acquisition & the DUP Process (cont’d) • Claims follow-up system: • Objectives: • For QMM to be keenly aware of local community expectations • To implement a fair and equitable resettlement plan for PAPs during the construction period • Process following receipt of claim: Corrective Measures (incl. Payment, title to land) Data Collection Verification 2-Way Feedback Cases closed and archived

22. Employment • Maximisation of local employment: • Aptitude testing of residents to establish and draw from a pool of local labor • Establishment of procedures and protocols for QMM and contractors to hire local skilled and unskilled labor wherever possible • Job creation to date: • QMM – 265, of which 235 Malagasy and 30 expat positions • Contractors – 3 050 positions, of which 1 875 locals, 800 nationals, 375 expats • Establishment of a local training centre and trades school (CFPTA) • Support for local employment initiatives: training of local tourism guides, handicrafts training, …

23. Local Procurement & SMEs • Inventory of local suppliers of goods and services capable of working to RT/QMM standards • Policy of favoring local supply wherever possible • Funding of a micro-credit scheme for the local population • Information sessions with local entrepreneurs on business opportunities generated by the ilmenite project • Local supply and service contracts for construction, cleaning services, security services, housing, food & beverage (total of roughly 20 companies thus far) • Promotion and training of local SMEs • Direct contribution to the local economy (2006 & 2007): ≈ US$ 12 million • Incl. labour, food and accommodation, materials, services, vehicle hires, Land rental, etc.

24. Migration & Inflation Management • Migration action plans: • Surveillance of population migration in the greater Fort-Dauphin area • Implementation of system of influx measurement established with the Région and communities • Current population of greater Fort-Dauphin area: 55 000 – 60 000. • Estimated 1 500 migrants have settled in the Fort-Dauphin area since 2005 (3% ↑) • Capacity building to offset migration • Contribution to improved hygiene, including installation of hydrants, water fountains, wash basins, rubbish bins and collection • HIV/AIDS/STD education, in partnership with Int’l HIV/AIDS Alliance, GTZ, PSI, UNDP • Training of peer educators • Implementation of the CLLS’ anti-HIV/AIDS programme • Capacity building for CSW Association

25. Migration & Inflation Management (cont’d) • Inflation Action plans: • Consultations in progress to implement an inflation monitoring system • Supported by INSTAT and the Région • Regular tracking reports • Provide support to studies on the alleviation of poverty in the Anosy region • In partnership with: CARE and the Région • Funding provided for studies to establish indices of measurement of local living conditions • Promotion of local produce growing initiatives, food and rice distribution initiative

26. PIC / Government Cooperation • Key partners: • PIC = Integrated Growth Poles Project, supported by the Word Bank • US$ 55 million earmarked for Fort-Dauphin Area, of which US$ 35 million for Port d’Ehoala • Other partners: Jirama (Min. of Energy & Mines), Min. of Transport, Min. of the Environment, Min. of Finance • Synergies: • Power – 6th Wartsila generator = 3.8 Mw (current FtD consumption ≈ 1.2 Mw) • Contributions: QMM financing of 6th genset + transmission & PIC US$ 2 million • Water – water treatment and reticulation for the town of Fort-Dauphin • Contributions: QMM US$ 1.0 -1.5 million* & PIC US$ 2 million • Refuse – management of solid waste collection and waste site • Contributions: TBD * over and above QMM’s own requirements

27. 2007 & Beyond • Social & Communities Management Committee (SCMC) initiatives and follow-up programmes: • Monitoring of 2007 milestones • Communications (information/cultural center) • Sustainable development (including 2006 report) • Community relations • Local content • Resettlement and accompanying programme follow-up • Inflation/migration • HIV/AIDS/STDs • Local government relations and capacity building • NGO & World Bank partnerships

28. Discussion Points • Background • Construction of infrastructure, mine & port • Social Issues • Land acquisition, Community, HIV/AIDS/STDs, Collaboration with PIC • Environmental Issues

29. Environmental Context and Issues • Madagascar is a highly environmentally sensitivite country • unique biodiversity • primary threat from felling of forests and « slash and burn » agriculture • Increased demand for land and fuel for agriculture and housing • Accelerated deforestation and loss of biodiversity

30. Littoral Forest degradation

31. Primary project-related achievements • Biodiversity conservation and monitoring • Plant production for rehabilitation and stabilisation • Ecological restoration • Sustainable management of natural resources • Support for regional environmental initiatives

32. Biodiversity conservation and monitoring of ecosystems • 1677 hectares of protected areas created and included into the Système des Aires Protégées de Madagascar (SAPM) • 70% of Field Guide completed (400 species from littoral forest), with publication in 2008 • Biodiversity Monograph completed : Biodiversity, Ecology and Conservation of Littoral Ecosystems In South-Eastern Madagascar, Tolagnaro (Fort Dauphin) • Seed conservation: roughly 50 lots seeds sent to Millennium Seed Bank (MSB) at Kew • Environmental education: Birdwatching Event with BirdLife in Mandena, Ste Luce & Ivorona

33. Plant production for rehabilitation and stabilisation • 100 ha planted in 2007. EMP commitment achieved with 600 ha planted ahead of mining (over 650,000 trees, with exceptional 95% survival rate) • Set up Réserve Foncière de Reboisement with CIREEF to secure and manage plantations (above) in the region • 300,000 vetiver plants produced for road and dune stabilisation • 2007 plant production on-going for road and infrastructure rehabilitation, as well as landscaping and community planting

34. Ecological restoration • Littoral forest restoration programme on-going : seed harvesting and treatment / plant production in nursery • Forest restoration trials on several degraded land parcels • Top soil management and conservation programme ongoing in collaboration with construction team • Wetland restoration trials

35. Sustainable management of natural resources • Co-management contract (Dina) signed in Ste Luce & Ambatotsirongorongo (21 000 ha) • Co-management contract (Dina) in progress in Petriky & Andrakaraka (done) • Objective of capacity building for COGE (Comité de Gestion) management • Strenghtening of local agriculture, beekeeping, composting, vegetable production, handicrafts & ecotourism

36. Support of regional environmental initiatives • Signed Phase II of the QMM/USAID partnership (GDA) • Support regional nursery (120,000 trees/yr) and regional reforestation • Support regional domestic energy strategy • Support local Water and Forest CIREEF in various activities • Partnership with PIC (WB) on environmental offset (Bay of Ste Luce)

37. Primary objectives • Set up NPI (Net Positive Impact) strategy in collaboration with Rio Tinto and the BAP (Biodiversity Action Plan) and BPM (Biodiversity Performance Measures) • Publish the Monograph book on Biodiversity • Establish Conservation Zones on site and as offset (Petriky, Tsitongambarika, Mahabo) • On-going rehabilitation of roads and infrastructures • Implement the Biodiversity Data Base and GIS • Restructure and upgrade skills of the environmental team

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