The impact of coal mining on the living conditions of rural communities in Mozambique: a case study of Cateme

Master Thesis


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University of Cape Town

In mineral-rich countries, large-scale extractive industry projects often offer mixed blessings. On one hand, mining royalties and taxes provide funds that amplify state coffers allowing for investments in infrastructure, social services and community development. In addition, jobs are created and local enterprises find new opportunities to provide goods and services to transnational companies spearheading the projects, enhancing livelihoods and contributing towards economic growth. On the other hand, large revenues from the mining sector may create opportunities for corruption, undermining public transparency and accountability from public officials. Furthermore, mining booms may hamper productivity and competitiveness in other industries through real exchange rate appreciation. Mining also has hazardous environmental effects often exposing surrounding communities to long-term health risks. The fairly recent large-scale extractive industry projects in central and northern Mozambique are not exempt from some the above-mentioned factors, particularly in the booming coal mining town of Moatize. The current study examines the impact of mining operations by Brazilian mining company Vale on the living conditions of resettled communities in the district of Moatize. The study focuses on the period from 2010 to 2013, which corresponds to the first stage of active exploration of coal in Moatize and the first years of integration of the resettled families in their recently built community. The Moatize Coal Reserve in Mozambique is deemed to be the largest reserve of untapped coal in the world (Audu, Ribeiro, Scott, & Taniguchi, 2006). The world’s largest mining companies, accompanied by a massive crowd of investors and fortune-seekers, are flooding the country with prospects for astronomical profits in the mining industry. In addition to coal, the country possesses over 100 trillion cubic feet of natural gas (Verma, 2012). Other lucrative natural resources in Mozambique include gold, rubies and tantalum. These latest discoveries undeniably position Mozambique as a resource-rich country.