Business News: 08/05/08

By Simon Clark, Michael Smith and Franz Wild

July 23 (Bloomberg) -- Adon Kalenga works seven days a week collecting minerals from the ground with his bare hands.

He is 13 years old and lives in Katanga province in the Democratic Republic of Congo. He has no home and can't afford the $6 a month it costs to attend public school in this central African country of 62 million. Sometimes he sleeps in the streets; other nights he spends in an orphanage.

Mostly, he works, earning about $3 per day. He's one of 67,000 people in Katanga who earn a living collecting stones infused with two minerals that are in demand worldwide: copper and cobalt. Reddish-brown copper is used to make the electrical wires needed to light the world's cities. Cobalt, a silver-gray metal, is used to make jet engines, ink and mobile phone batteries.

Katanga, a region of green rolling hills that's bigger than California, is home to 5.5 million people. The province in the south of Congo contains 4 percent of the world's copper and a third of its cobalt reserves, according to the U.S. Geological Survey.

The minerals Adon and children like him wrest from the red, hard earth find their way to smoky smelters on the edge of impoverished towns near the mines. Most of these rusting, hand-fed furnaces are owned by companies based in a faraway country, one that was founded on an ideology that exalts the rights of workers: the People's Republic of China.

``My life is hard,'' says Adon, wearing black rubber boots, a hooded sweatshirt and ripped jeans that sag on his skinny frame.

`I Don't Know Why'

Adon's left shin is scarred from a fall during a mine landslide three years ago that killed workers, including four young friends. He spends the day around unstable, hand-dug mineshafts, using his bare hands to fill sacks with ore.

He then hauls the rocks down a steep trail. At the end of the path, he works knee-deep in a stream, the kind that has spread a cholera epidemic throughout much of Katanga. The boy's hands are raw from washing rocks in a metal screen.

``The Chinese buy the ore,'' Adon says. ``I don't know why.''

Adon toils alongside about 200 other boys and men and a handful of women in the Kamatanda mine, a 1-square-mile (2.5- square-kilometer) area pockmarked by holes as deep as 80 feet (25 meters).

On paper, the mine, 3 miles (5 kilometers) northeast of the town of Likasi, is owned by Congo's state mining company, Lubumbashi-based La Generale des Carrieres et des Mines, or Gecamines.

Chaotic Capitalism

In reality, Adon and his peers practice a chaotic form of capitalism, with little supervision from either the company or the state. The hand diggers aren't employees; they're freelancers who sell what they've dug and cleaned to brokers such as Patrick Nsumba.

The middleman pays Adon to wash the copper ore, which the man sells to a smelter in Lubumbashi, Katanga's capital. The plant is run by a unit of Tongxiang, China-based Zhejiang Huayou Cobalt Co., which processes Katangan copper and cobalt. With wads of Congolese francs on hand, Zhejiang Huayou's representatives buy ore from people like 29-year-old Nsumba.

``This is one of the worst forms of child labor,'' says Joost Kooijmans, a legal officer at the Geneva-based International Labor Organization, a United Nations agency. ``If they're buying ore processed by children, they're involved in violating the rights of the children.''

Chinese smelters buy cobalt and copper from mines across Katanga that use child labor, says Patricia Feeney, who campaigns for the rights of Congo's miners.

`No Regard for Health'

``The Chinese smelters have no regard for the health and safety of their workers or the children who dig the ore,'' says Feeney, executive director of Oxford, England-based Rights and Accountability in Development.

In Tongxiang, the Chinese city 80 miles from Shanghai where Zhejiang Huayou is based, marketing manager Zhai Yang says his company sells processed cobalt via intermediaries he declines to name to companies such as Sony Corp., the second-largest consumer electronics company; Nokia Oyj, the world's largest cell phone maker; and Samsung Electronics Co., the second-largest mobile phone maker.

George Boyd, a spokesman for Tokyo-based Sony, declined to comment. Susan Allsopp, of Espoo, Finland-based Nokia, says the company is researching whether Zhejiang Huayou is an indirect supplier.

``We have no evidence to suggest that they are supplying any of our suppliers,'' she says. ``We take any accusations of this nature seriously and do not accept the use of child labor or abuses of human rights. We will continue to monitor this matter, and if we find any breaches of our standards, we will take swift action.''

`I Don't Know'

Samsung spokeswoman Hae Won Choi says the company is investigating and, so far, 70 percent of its suppliers say they don't buy cobalt from Zhejiang Huayou.

Zhejiang Huayou's Zhai says he doesn't know whether his company buys minerals that originated with child labor.

``I've never been to Congo, so I don't know the mines,'' he says. Zhai says his firm has a policy against child labor and will investigate. It will stop purchasing ore if it was dug by children, he says. ``It's our responsibility to make sure the local children are safe, so we won't buy from any children,'' he says.

Congolese law must be respected, the Chinese government says. ``Chinese companies need to observe local labor laws and regulations and fulfill their social commitments,'' says Chen Rongkai, a Beijing-based spokesman for the Ministry of Commerce.

Hand Diggers

Congo, like China, has ratified an ILO convention against hazardous child labor. The Democratic Republic of Congo, formerly known as Zaire, borders the Republic of Congo.

Since 2005, the Chinese have become the primary owners of furnaces that rely on ore from hand diggers, says Katanga Governor Moise Katumbi. He says more than 60 of Katanga's 75 processing plants are owned by Chinese companies and adds that 90 percent of the region's minerals go to China.

From the deserts of Sudan in the north to the savannahs of Zimbabwe and South Africa, a juggernaut of Chinese companies is moving across Africa.

The goal is to secure natural resources to supply factories, build cities and fuel an economy that has expanded more than 9 percent per year on average since the late 1970s, when Chinese Communist Party Vice Chairman Deng Xiaoping pushed his country toward free enterprise. Deng is commonly associated with the phrase ``To get rich is glorious'' -- although he denied saying it.

Because China isn't self-sufficient in natural resources, the government has made the hunt for minerals and food around the world a foreign policy priority.

Lethal Conditions

In its global quest for commodities, China relies on laborers -- from hand diggers in Katanga to iron ore miners in Peru -- who work in unsafe, unsanitary and sometimes lethal conditions.

In mines, smelters and ports, hundreds of workers have been injured or killed since 2005 working for Chinese companies in Africa, Asia and Latin America, according to government administrators, workers, doctors and official documents.

In Congo, Fidele Kalwa, who runs the biggest morgue in Katanga province, eyes a list of 33 names of people, including four boys aged 13 to 17, who have died in separate mining landslides since the beginning of 2007.

``Many others aren't even dug up because they get buried in their holes,'' Kalwa says.

In Zambia, a blast in 2005 killed at least 45 workers at an explosives factory owned by Chinese-run Chambishi Nonferrous Mines Ltd.

Lung Disease

In Ban Chagnee, Laos, Chinese rubber plantation owners took rice paddies from villagers against their consent and unknowingly removed soil from a burial ground to build a road, according to a February 2008 study for German aid agency GTZ.

In Peru, regulators fined a unit of Shougang Corp., which is owned by Beijing's municipal government. Peruvian officials found that the firm violated regulations by allowing 110 workers with lung disease to work in an iron ore mine. Two have died since 2006. The company disputes those findings.

Africa's weak law enforcement makes the continent vulnerable to Chinese companies with lax practices.

``China desperately needs the raw materials that Africa supplies, to keep its economy growing,'' says Christopher Cramer, professor of the political economy of development at the University of London's School of Oriental and African Studies. ``Chinese companies will go anywhere in the world for natural resources, and many are neglecting labor standards where they are not likely to be challenged.''

Paving New Way

Africa is the world's poorest continent, burdened by centuries of slavery, colonial exploitation, civil war, despotism, corruption, famine and disease. In the past five years, Africa has become China's new frontier for oil, copper, cobalt and iron ore.

Chinese diplomats are paving the way for China's companies, courting governments in places like Congo with promises to build roads, railways and ports -- and to provide jobs. In exchange, China has received access to mines and oil fields and the rights to buy minerals for years to come.

The Chinese don't tie African aid and investment to requirements that governments respect human rights and labor standards, says Ana Maria Gomes, a European Parliament member from Portugal. She sponsored a Parliament resolution critical of China's African strategy that passed by 618 to 16 votes on April 23.

Yang Jiechi, China's foreign minister, said at London's Royal Institute of International Affairs in December that countries should be allowed to set their own standards for development. ``The right of all countries to choose their own social system and development path should be respected,'' he said.

Summer Olympics

China's policy of noninterference is paying off just as the country prepares to host an international coming-out party in the form of the Summer Olympics in Beijing. Exports from Africa to China rose to $29.9 billion in 2006 from $6.3 billion in 2000, according to the International Monetary Fund.

State-owned China National Petroleum Corp., China's largest oil and gas company, is the biggest foreign oil producer in Sudan. More than 200,000 people have died since 2003 as the result of a civil war in Sudan's Darfur region, in what the UN has described as one of the world's worst humanitarian crises.

China, a permanent member of the UN Security Council, has long opposed sanctions against Sudan and its president, Umar al-Bashir.

China also trades with Zimbabwe. On June 29, President Robert Mugabe, 84, declared himself the victor in a runoff election that European Union leaders and the White House called a sham.

On July 11, Mugabe's regime escaped UN sanctions when China and Russia vetoed a U.S. effort to punish him with an arms embargo.

`An African Problem'

``This is an African problem,'' says Liu Zhenmin, Chinese deputy ambassador to the UN.

Wu Zexian, China's ambassador to Congo, says, ``We will work economically in countries without interfering at all in their internal affairs.''

Wangari Maathai, a Kenyan environmentalist who won the Nobel Peace Prize in 2004 for opposing political repression, says China has an obligation to ensure it and its companies act in a civil and humane manner.

``In countries where human rights aren't respected and where people can't hold their governments accountable, it's vital for foreign governments and investors to impose conditions,'' Maathai, 68, says.

The no-strings deals China makes in Africa benefit consumers in the U.S., Europe and Japan, says Jonathon Bond, managing partner at London-based Actis Capital LLP, which has invested $3 billion in Africa and other developing regions.

`Subcontracted Manufacturing'

The commodities Chinese companies acquire in Africa and Latin America supply factories in China that export more than $1 trillion of goods a year.

``The West has subcontracted its manufacturing industries to China,'' Bond says. ``China imports African raw materials and then re-exports them as components of finished goods to the West.''

That supply chain starts in places like the Kamatanda mine, where hundreds of men, women and children toil in the scorching sun, digging and trading on ground covered by feces in an area with no sewage system and no tap water.

Amid the clamor of hammers, picks and shovels, dust fills the air. The workers don't use excavators or trucks, nor do they work in ventilated shafts. Instead, they labor barefoot and shirtless in lunar landscapes of rocks and pits.

There are 67,000 miners known as creuseurs -- a word of French origin, meaning diggers -- working in Katanga's copper belt, according to Saesscam, a government labor agency that oversees ore miners.

His Body Hurts

One of the workers is Adon, the homeless teenager. On a sweltering day in March, Adon breathes in rancid air as he stands in a stream below the mine, surrounded by workers washing ore. He says his whole body hurts, especially his feet and shoulders.

He has been carrying 40-pound sacks of ore to the river. His small, calloused hands are raw, and bits of stone are shoved under his fingernails.

Sitting on a bag of copper ore a few feet away is a trader, Giselle Ngoya, who breastfeeds her 7-month-old daughter as she haggles over prices with miners.

When Adon was 9, his father died and his mother abandoned him. Adon's aunt and uncle, angry that they had another mouth to feed, accused the child of witchcraft and turned him onto the streets, Adon says.

``I don't believe in this sorcery stuff,'' says Adon, who attends church on Sunday mornings before going to the mine. One day, he says, he'd like to be a mechanic.

Soon after Adon was thrown out of his house, a friend suggested he work at the mines. During Adon's first year on the job, he was nearly killed. He was carrying a sack of ore on his head when torrential rain caused a landslide. Adon, fleeing with other miners, lost his footing in the mud and fell. A rock slammed into his left shin.

`Blood Was Flowing'

``Blood was flowing a lot,'' he says. ``I could even see the bone.'' Adon says that among the dead were four friends -- Fabrice, Jean, Patient and Patrick.

Adon works for middlemen like Patrick Nsumba, who manage the flow of ore from Kamatanda to the smelters. Adon says other middlemen aren't as fair as Nsumba.

``There are a lot of people who haven't paid me,'' he says.

Nsumba says Adon asked him for the work because he needed the money to buy food.

``I'll do everything so my kids don't have to work in the mines,'' Nsumba says. ``The conditions are too tough.''

Nsumba graduated from Congo's Lubumbashi University in 2005 with an economics degree. He pays child laborers like Adon a flat rate of $3 a day.

Copper Prices Triple

Adult diggers who explore deep underground for minerals are paid more when they're producing. Those workers pay a tax of 18 cents per 110-pound bag to Saesscam, the agency that oversees hand diggers.

Nsumba sells the ore for a markup of almost 100 percent to Congo Dong Fang International Mining Sprl, which is owned by Zhejiang Huayou. Even though the three-year rally in commodities lost steam earlier this year, cobalt prices have doubled since the start of 2005, and copper values have almost tripled.

Aside from the Chinese, Gecamines and companies run by Indian, Lebanese and local entrepreneurs also purchase the ore unearthed by the hand diggers, says Denis Kampashi, who runs Saesscam's office in Lubumbashi.

A few hundred feet up a slope from the stream where Adon works, a hill is scarred with dozens of hand-dug shafts, piles of dirt and narrow, slippery trails with gaping pits on each side.

Another teenage boy, Carlito Muamba, climbs partway down a 50-foot-deep shaft that workers have dug with their hands and small shovels. There's no ladder; Carlito scrambles in and out of the hole using his hands and feet.

No Bracing

The shaft has no bracing to protect against cave-ins. It has no fans or vents for air circulation to prevent suffocation.

Carlito, 15, wearing a T-shirt and ripped sneakers with no laces, crouches on a narrow ledge about 10 feet down and stabs a shovel into the mine wall to search for ore.

His digging causes the unsupported tunnel walls to come loose. Red dirt and pebbles begin falling onto Carlito's shaved head. Even so, he keeps digging for more stones with his hands, sweating. Then he claws at the earth with his fingers and climbs out of the hole. Carlito says he is risking his life because he's hungry.

``I work to pay for food,'' he says.

Carlito says he's too young to dig at the bottom of the hole, where miners use hammers, chisels, shovels and their bare hands to secure ore. ``My brothers work down there,'' he says.

Carlito dropped out of school in fifth grade to work with two older brothers at the mine. Four other siblings live at home with his mother in Likasi, and his father can't afford to feed and school them all.

`Poison Mines'

Everyone in Katanga province, including the managers of Chinese smelters, knows children work in the mines, says Betty Bambi, who runs a charity orphanage where Adon sometimes sleeps. She says neither the government nor the companies do anything to help the child miners.

``The mines are like poison,'' says Bambi, 61, who wears a black gown with a pattern of apples and blossoms and is known as Mama Betty to the children in her orphanage. ``The kids work without any safety equipment. The Chinese don't care about the kids. All they're after is the minerals.''

Yang Youngjian, external relations manager in Likasi for Congo Dong Fang, says he hasn't been to the mine, which is 3 miles from his office in Likasi.

``I've seen pictures,'' he says. ``The conditions aren't so good. They are even working with babies on their backs. They are very grueling conditions.''

Centuries Old

He says that if his company stops buying, the workers will lose jobs.

The hand diggers of Congo use methods -- such as working in shafts without shoring, lighting or ventilation -- that began to disappear in other parts of the world in the 1700s because mining companies viewed them as too dangerous, says John Tilton, a professor of mining economics at the Colorado School of Mines in Golden, Colorado.

``Nobody in their right mind would want a job like that unless there's nothing else,'' he says. Katanga hand diggers say they buy their own picks, shovels and torches.

The situation at Kamoto, an underground mine 80 miles from Kamatanda, is different. There, the miners are all employees, not freelancers. They work for the mine's owner, Bermuda-based Katanga Mining Ltd.

The company supplies every miner with $250 worth of safety gear, including a lamp fixed to a hard hat, steel-toed leather boots, coveralls, a belt, a jacket and pants.

Weak Enforcement

``We want to bring safety standards up to North American or European safety standards,'' Katanga Mining manager Andre Boudreault says.

Congo regulators have safety and environmental standards for the mines at which hand diggers collect ore for Chinese companies, but government enforcement is weak, Governor Katumbi, 43, says. Congo's rules follow ILO standards banning child labor.

A Chinese smelter called South China Mining Sprl gets copper ore from Katanga's Kawama mine on a hill overlooking the Congo River, where 3,500 people work inside unstable hand-dug holes.

Joe Kongolo smashes boulders with a sledge hammer. Last year, a mine shaft near where Kongolo was working caved in and buried three men under dirt and rocks, he says. Kongolo, 24, rushed to assist.

``I was helping, digging with my shovel and my hands,'' he says. The workers managed to save two of the men, he says. The third, whom Kongolo didn't know, died.

South China Mining founder Hilton Tsoi, who's based in Hong Kong, says he's visited hand diggers' mines.

`They Have No Choice'

``The conditions are so-so,'' Tsoi says. ``Just humans, no machinery.'' Tsoi, 58, says he's buying ore from people who have to work to survive. ``They have no choice,'' he says. ``How can they get their food?''

Chinese-owned smelters in Katanga are particularly prone to accidents that maim or kill workers, Katumbi says.

``It's not even the Chinese standards which they are building here,'' he says. ``There are no standards.''

Most North American and European companies adhere to international safety and labor guidelines set by groups such as the Geneva-based International Organization for Standardization and the ILO. The rules forbid using children under the age of 18 in hazardous conditions.

Since March 2007, Katumbi says he has expelled about 600 Chinese nationals from Katanga for violating labor and environmental laws, about 12 percent of the number working there at the time.

Chinese Explorers

China's connections to Africa go back to the early 1400s, when Chinese explorers sailed through the Indian Ocean to the continent. The Ming dynasty, which ruled China from 1368 to 1644, reined in oceangoing voyages as part of a policy of isolationism.

Britain, Portugal and Spain started raiding Africa in the 1500s to bring slaves to work on plantations in the Americas. By the 19th century, European powers had colonized most of the continent, in part to gain control of its resources.

The Congo region was claimed by Belgian King Leopold II in 1885 as his personal property. The Belgian Congo was granted independence by Belgium in 1960 and became the Democratic Republic of Congo in 1997.

China's influence in Africa started to grow after Mao Zedong founded the People's Republic of China in 1949.

The communist leader established ties to Africa's newly independent states in the 1960s, competing for influence on the continent with the West and the Soviet Union, which sought resources and political relationships of their own, says Martyn Davies, executive director of the Centre for Chinese Studies at South Africa's Stellenbosch University.

`International Prestige'

``Mao was seeking international prestige and recognition,'' he says. In Kinshasa, Congo's capital, China built the National Assembly building in the 1970s and the Stade des Martyrs soccer stadium in the 1990s.

Since 2003, Chinese Premier Wen Jiabao and President Hu Jintao have visited 20 African countries between them. In November 2006, representatives of 48 out of 53 African states gathered in Beijing for a summit.

In January, China expanded its ties with Congo by promising to finance $9 billion of roads, railways and mines in exchange for 10 million metric tons of copper and 600,000 tons of cobalt from six Gecamines-run mines over a decade at a fixed price.

``We are going to build major public works at the same time as building mines,'' says Wu, China's ambassador to Congo.

Congo's southern plains are scattered with derelict mines and furnaces -- relics of the predecessor of Gecamines, which Belgium built to extract minerals from its colony.

`A Disaster Area'

The company was plundered during the 32-year regime of dictator Mobutu Sese Seko, who was ousted from power in 1997 by rebel leader Laurent Kabila. In a civil war that lasted from 1998 to 2003, scrap-metal scavengers hacked Gecamines facilities to pieces.

Kabila was assassinated in 2001 by one of his bodyguards. He was succeeded as president by his son Joseph.

``The mines are like a disaster area,'' says Paul Fortin, 69, the Canadian-born chief executive officer of Gecamines. He says China's $9 billion offer was the best one on the table. ``If anybody else can match that, please tell me,'' he says.

Wu says Chinese banks will guarantee the loans for the deal so they won't increase Congo's $11.5 billion of debt.

Xavier Maret, the IMF's Congo representative, isn't so sure. It's not clear who will borrow all the money. Neither country has fully disclosed the terms of the deal, he says. Congo may have to guarantee the loans, which would jeopardize an IMF plan to forgive more than half the national debt, Maret says.

Molten Cobalt

China's promises are meaningless to Mbayo Muyambo, who says he's witnessed a torrent of injuries as safety director at Chinese- controlled Feza Mining Sprl in Likasi.

Muyambo, 38, says Feza's workers are routinely burned at the company's smelter by fiery drops of molten cobalt because the company doesn't supply fireproof suits.

``They say they're too expensive,'' says Muyambo, who had previously worked for 17 years at Gecamines, where he received training from German safety engineers.

China's Wanbao controls Feza, according to Wang Xiao, Feza's deputy director. Feza's shareholders include Congolaise des Mines et de Developpement, which is owned by Gecamines, and Ramat Gan, Israel-based DGI International Ltd.

On March 29, one of Feza's inspectors, Punda Luhendwe, mutilated his left eye when he tried to put out a fire in the smelter control room because he wasn't wearing protective glasses, Muyambo says.

Pushed back by waist-high flames, Luhendwe grabbed a fire extinguisher and its hose whipped up into his eye, Muyambo says.

`Only Productivity'

``The only thing the Chinese care about is productivity,'' he says of his bosses.

A Feza spokeswoman who identified herself as Mrs. Yang declined to comment. Beijing-based Wanbao Mining Ltd. didn't respond to requests for comment. DGI spokesman Pieter Deboutte says the firm has no role in managing Feza and gets no profit from the smelter.

Ambassador Wu says his government can't police the multitude of Chinese investors in Africa.

``There are entrepreneurs who go all over, and when they find a place with good prospects, they stay,'' he says. ``All investors need to respect the law.''

Katanga's government struggles to enforce its own labor and environmental regulations, provincial Mining Minister Barthelemy Mumba says. On a sweltering 90-degree-Fahrenheit (32-degree-Celsius) day in March, he's driving a silver Toyota Land Cruiser over a rutted dirt road.

He arrives unannounced at a cobalt drying plant run by Chinese-owned Cota Mining Sprl near Lubumbashi. The provincial environmental mining ministry had shut down the facility in December because a pool of acid was in danger of leaking into a stream.

`Why Did You Restart?'

The plant was supposed to stay shut until further notice. On this visit, Mumba finds dozens of men shoveling ore into a 50- foot-long oven, their feet baking inside thin rubber boots.

``We suspended your production,'' Mumba tells Nino Ngaktambo, Cota's top Congolese manager at the site. ``Why did you restart without our authorization?''

Ngaktambo says, ``We were just trying to --'' as Mumba yells at him, ordering him to close the site.

One worker, Dunancien Molupenga, tells Mumba he's afraid he'll be fired if he doesn't get back to stoking the drying oven. A few feet away, a Chinese manager in a straw hat gives Molupenga a signal to get back to work. The Chinese manager doesn't speak French, Swahili or English. He declines to give his name or to comment.

`I Could Be Fired'

``I could be fired just like that if I don't work,'' Molupenga says, adding that most Chinese managers don't speak the language of workers, so they use hand gestures to communicate. The Cota raid lasts 30 minutes. By the time Mumba leaves, everyone who paused in his labors is back at work.

``You have to distinguish between those companies that abide by international standards and those that don't,'' Mumba says. ``Among those that don't, you often find Chinese companies. We don't want people to come and build things like this. This, really, isn't investing.''

On March 6, Cota got an order from Katumbi allowing the firm to continue work. Lan Mei, vice director of the company's operations in Lubumbashi, says workers were making adjustments to the oven on the day of the raid, and no cobalt was being refined.

``It was preparatory work,'' says Lan, who tours her smelter dressed in a baggy black dress, burgundy boots with untied laces and a 2-inch (5-centimeter) amber-colored pendant around her neck. Since the December inspection, Cota has given workers cloth masks, rubber boots and long-sleeve work shirts, Lan says.

No Formal Training

``We provide safety equipment,'' she says. A year ago, Lan says, she got the second-highest-ranking job at Cota because she speaks French, unlike her Chinese bosses.

Lan, 37, a former fine arts student in Aix-en-Provence, France, has no formal training to oversee Cota's six smelters, which heat copper ore to the melting point of 1,981 degrees Fahrenheit until it's ready to be drained, at which point the furnace is opened and liquid metal gushes out, along with toxic smoke and flying drops of molten metal.

Cota's Congolese workers say they suffer from a lack of safety equipment. Welder Clovis Pienar's arms and chest are covered with two dozen scars. Pienar, 25, wears a plastic visor and thin cotton overalls. They don't protect him, he says. His pants caught fire earlier this year, and today there's a dark hole on one leg.

``We are treated like animals,'' Pienar says.

Jerome Musonda, 33, has two scars next to his right eye, where he was burned stoking Cota's smelter without safety gear earlier this year.

``Nearly every week there's an accident,'' he says.

Mumba also faults Chinese companies for paying workers less than North American and European mining companies. Cota workers say they're paid $65 a month, 35 percent less than the $100-a-month base pay Katumbi has said he's seeking.

`Benefits Are OK'

A few miles away is a smelter owned by Societe pour le Traitement du Terril de Lubumbashi, or STL, a joint venture between Cleveland-based OM Group Inc., Lubumbashi-based investor George Forrest's Forrest Group and Gecamines.

``The pay and benefits are OK,'' says Alex Tetemukombo, who gets $218 a month for tending a smelter in heat-resistant steel-toe boots and a fireproof suit. ``A lot of people who work at other smelters don't get that protection, especially when they work for the Chinese.''

As more and more Chinese arrive in Katanga, pressure is rising to prove to locals that they'll benefit from the new investors, Gecamines' Fortin says.

``There will be a backlash,'' he says.

On March 6, there was one. Diggers from the Kamatanda mine clashed with riot police in Likasi. They were protesting because Gecamines wanted to oust them from the land and reclaim the mine after it traded six of its other mines to China.

Teenager Mistakenly Killed

As stones flew, a policeman shot Landry Milongo, a passing 15- year-old schoolchild, Likasi Mayor Marthe Chiwengo says. By the time the teenager reached the hospital, he was dead.

Three days after the shooting, about 50 relatives mourn next to an avocado tree at the family's tin-roofed hut.

``The population isn't benefiting at all from the mining,'' says Rene Kasongo, the dead boy's great-uncle. ``The companies just take the minerals and pay the bare minimum.''

Chinese companies are scouring the world for commodities to feed the fastest growth rate of any major economy.

``Chinese economic growth is dependent upon access to these resources,'' says Chris Alden, a professor at the London School of Economics and Political Science and author of ``China in Africa'' (Zed Books, 2007). ``Some of these companies are exporting worst practice instead of best practice from China.''

China's leap from Marxism to capitalism has come at a cost of deadly labor conditions, says Han Dongfang, who founded the China Labour Bulletin in Hong Kong, which monitors Chinese worker abuses.

`Totally Ignored'

``The government has totally ignored health, environmental and social responsibility,'' Han says. ``The Chinese, from the top leaders to the desperate ordinary people, believe that making money is more important than human life.''

Chinese coal mining accidents killed an average of 10 workers a day last year, according to the Chinese State Administration of Work Safety. Last year, the governor of Shanxi province was forced to make a public apology after official media disclosed that brick kiln managers in his province were using child slave labor.

Under Mao's state socialism, China's masses were supposed to be protected by a cradle-to-grave welfare system dubbed the ``iron rice bowl.'' The government and its giant state-owned enterprises offered full employment, subsidized housing, free health care and pensions.

Mao's regime was no workers' paradise: 70 million people died from manmade famine and political oppression, according to ``Mao: The Unknown Story'' (Knopf, 2005).

415,000 Millionaires

In the past 30 years -- following Mao's death and Deng's embrace of market principles -- 300 million out of a population of 1.3 billion have lifted themselves out of poverty, according to the UN. More than 415,000 of them have become millionaires, according to a study by Merrill Lynch & Co. and Capgemini SA.

Still, another 200 million live on less than $1 a day, according to a 2004 World Bank estimate.

The new China urged unprofitable state-owned companies to put profit ahead of providing for employees. From 1995 to 2001, 46 million Chinese lost their jobs, according to Andy Rothman, a Shanghai-based China strategist at CLSA Ltd. and former economic official at the U.S. Embassy in Beijing. Private companies now account for 70 percent of China's gross domestic product compared with 17 percent in 1990.

The rush to make money came at the expense of workers, says Auret van Heerden, Washington-based CEO of the Fair Labor Association, a nonprofit organization that monitors work conditions in 60 countries.

New Laws

``Conditions in China became comparable to the period in the West from the Industrial Revolution in the 18th century up to the Second World War,'' van Heerden says.

This year, in an effort to bridge the growing chasm between rich and poor and to close down the worst sweat shops, Chinese President Hu passed new labor laws setting minimum wages and assuring one month's pay for each year worked for employees who get fired. Hu has yet to send that message to Chinese companies working abroad.

Maathai, the Kenyan Nobel laureate, says Chinese companies should respect human rights and internationally accepted labor standards around the world.

``We in Africa expect China to help and not to take advantage of Africa's vulnerability,'' she says. ``China needs to understand Africa. We hope she will.''

For Adon Kalenga, the 13-year-old from Congo whose minerals supply Chinese smelters, the concept of fair treatment is a world away.

It's the end of a nine-hour workday in March, and he's slumped in a chair, nursing his back. Tomorrow, as he has almost every day for more than three years, Adon intends to return to the mine and the stream.

``I want a normal life, like the people I see walking in the street,'' says Adon, who can barely read and write. ``But I can't even afford to go to school. Things will never change.''

Original here

Business News

Useful Sites

Blog Archive

My Blog List

Tuesday, August 5, 2008

Mobile phone market to decrease in value

China Lets Child Workers Die Digging in Congo Mines for Copper

Knights Templar to Vatican: Give us back our assets

Report: 16 police killed in China border attack