Poorva Karkare and Nadia Ashraf, ECDPM blog, 28 October 2019
We recently attended an event organised by ActionAid Netherlands to discuss a ‘just transition’ away from coal mining. Everything about this meeting was different from the usual (dull) meetings in large conference halls with impersonal settings you get so used to over the years.
This particular exchange – between former coal miners from the South Limburg region of the Netherlands and human rights defenders from low-income countries with mining operations (Zambia and Guatemala) – took place at the mining museum in Kerkrade, the heart of the old coal mining region in the country. The museum is in fact a shaft of one of the former mines; what better place to discuss a transition away from coal mining?
Mr Wiel Friedrichs, the former president of the federation of trade unions (FNV) in the Limburg region, gave an overview of the difficult transition process that he personally oversaw. This was a long process involving some 100,000 workers over the course of 20 years.
Participants exchange their experiences
Mr Friedrichs particularly emphasised the importance of anticipation. Miners in Limburg were informed of the impending closure of mines, giving them enough time to think of an exit strategy. A well thought-out plan for supporting re-education and training meant that several thousand workers were absorbed into other industries. Funds were also set aside for those workers affected by silicosis and other ailments, given the long exposure to coal mining. In short, the unions, along with the government and the industry, negotiated deals that would be beneficial to miners.
There were no doubt champions that led the transition. Miners themselves took the initiative to seek opportunities for employment in other sectors. These ranged from the chemical industry, already upcoming during this transition, to railways and textiles. One of the former miners even joked that it was quite a change to go from mining coal to making women’s lingerie. The unions demanded ‘no closure without new employment’, which became a central pillar of the restructuring process.
The national government initiated and led the restructuring process, which was completed in several phases. The fact that the state owned a significant chunk of the mining operations helped it drive the process. It invested in re-education for miners so they could find other work. A dedicated development agency was set up to promote entrepreneurship and employment, with a view to resolve the emerging problem of youth unemployment – which peaked at 22% in 1976 and 1977.
The government made a concerted effort to attract different industries to the region. It was important that this diversification was sought by not depending on one or two big corporations, but also attracting several small to medium firms. Over time, these have become thriving businesses that form the industrial backbone of the region today. The government also moved some of its offices to the region.
Of course, provision of infrastructure to make the relocation of businesses worth their while was an important step. Mr Friedrichs stressed this was no easy task, and several rounds of negotiations had to take place before this became a reality. But the role and strength of the different parties involved is apparent. While the transition process cost several billions of euros, it was rather seen as an opportunity for a broader development policy for the wider Limburg region.
Could countries where transition away from particular mining activities is to be anticipated learn something from this?
In low-income countries, governments often lack the kind of resources that the Dutch had when they embarked on this arduous journey. Moreover, negotiations between governments, workers and mining companies can be increasingly difficult in these countries. Governments often lack capacity and workers are not unionised. Mining operations are dominated by large private companies, some of which have a global annual turnover that is larger than the economic size of the entire country that they sometimes operate in. Power balance between the actors is therefore tilted.
Nevertheless, there are some valuable lessons that can be drawn from the Dutch experience. On the policy front, apart from the importance of anticipation mentioned above, a balanced approach to short-term mitigation (worker compensation and re-education for affected miners for instance) and a long-term diversification strategy (such as development of infrastructure, wealth creation by developing an industrial base or investments in education for the future generation) is essential.
A multistakeholder approach with close consultations with those affected by the change is essential for this. However, the element of trust that is built into these negotiations will need substantial investment – of goodwill, money and other resources to begin with.
Restructuring of the industry should not be left to one party alone. Instead, there should be collaboration to achieve a ‘just transition’. Private firms tend to privatise profits (companies alone benefit from gains) and socialise losses (losses considered responsibility of general public). The effectiveness of well-organised unions to leverage influence cannot be overstated.
Moreover, there must be proactive initiatives from national and sub-national levels of government. Without a strong role for the state, Mr Friedrichs lamented, not much is possible. Strategic and tactful negotiations are required to come up with a plan in which everyone wins.
Finally, while governments in developing countries may not have the stash of financial resources needed for this transition, governments in the West could offer help. After all, they benefit from access to (cheap) coal and other mining resources from these countries. There are several initiatives to assist countries as they embark on such a transition.
One of the former mine workers gives the participants a tour of the museum
What we found especially remarkable is the wealth of information and learning opportunities offered by such collaborations between affected communities on one side, and the aspiring changemakers on the other. Even with language barriers – the Dutch side spoke only their language (their local dialect to be precise!) and the others English and Spanish – the exchange was rich with great lessons taken home.
The show of camaraderie didn’t end just there. Former mine workers gave us a tour of the mining museum, which they put together using their old gear and implements. The day ended with further exchanges on personal experiences of the former mine workers. The Dutch side extended this invitation to others interested to further collaborate on this important topic.
The views are those of the authors and not necessarily those of ECDPM.
Cover photo by Sinjy and Sadie via Flickr. Event photos by Poorva Karkare.