Wednesday, May 16, 2007

Landmines and Lonrho

A South African and a British company have come together to develop a project for land mine clearance. The companies are Lonrho and Countermine and they have proposed a joint venture agreement to develop opportunities for land mine clearance. The environment will be sub-Saharan Africa in order to rehabilitate previously unusable land. Lonrho will provide the funding and its extensive African business network to build the African arm of Countermine’s land mine clearance business.

Anti-Personnel mines cause up to 20,000 casualties every year across the world. Large tracts of the world’s land are rendered unable by landmines. Even the suspicion of landmines is enough to keep humans away from land. The Lonrho/Countermine joint venture aims to reclaim this land. Lonrho will provide the finance and Countermine will provide the hardware. Countermine’s selling point is a product called ORACLE (Obstacle Removal and Clean Land Equipment). Developed in partnership with the American Caterpillar company, ORACLE works as a sort of giant armour-plated plough. It traverses fields tilling the ground to a depth of 50cm as it goes along. The machine uses a massive sharp-toothed rotor to shred mines before they go off. And even if they don’t go off, they are smothered.

Countermine has experience in the field. In 2000, it won a contract from the Croatian Government to clear landmines from Croatia after the war with Serbia. Countermine says ORACLE adheres to the International Mine Action Standard (IMAS). IMAS are an evolving set of standards in force for all UN mine action operations since 2001. This work is co-ordinated by the Geneva International Centre for Humanitarian Demining (GICHD).

Anti-Personnel mines are often deliberately designed to injure rather than kill. Medics will be required; the injured will have to be evacuated. That way, they increase the logistical support burden on the opposing force. The 1997 Mine Ban Treaty (also known as the Ottawa Convention) compels 155 signatory countries not to manufacture, stockpile, transfer or use anti-personnel mines. However, as the cost of making a mine is US $2, while removing it costs US $1000 per mine, there are many notable omissions: the US, China, Russia, Israel, Iran, Iraq, Saudi Arabia and Vietnam, are all outside the treaty.

Under Clinton, the US refused to sign up unless it gained an exception to protect its troops in South Korea. However he did pledge to sign the Treaty by 2006. When Bush came to power, his administration initiated a review of U.S. landmine policy. That review concluded it was not in US interest to sign the treaty and the vague Clinton commitment was completely abandoned.

Landmines remain a staple of war on Earth. And their impact lasts long after hostilities have ceased. Almost 20 years after the Iran-Iran war, Iran still has 4 million hectares containing landmines. These mines are not only on the borders; some are planted inside Iranian cities. On average 2-3 people are injured or killed by landmines every day in Iran.

For now the joint venture is concentrating on Africa. Most African countries have signed up to the Ottawa Convention yet Africa is the most heavily land-mined continent in the world. There are at least 40 million mines and 140 million people live in countries where the risk of encountering mines is high or very high.

The most severely affected countries are ones that have all experienced post-colonial wars: Angola, Chad, Eritrea, Liberia, Mozambique, Rwanda, Somalia, Sudan and Uganda. The desert countries Egypt, Libya and Tunisia have also minefields dating back to World War II. In total, landmines kill or injure over 12,000 people per year in Africa.

And at first glance Lonrho seems an unlikely partner for this venture. They were once described by Edward Heath as an “unpleasant and unacceptable face of capitalism”. Heath made the comment in parliament in 1973 when he was Prime Minister. Then under the remarkable tutelage of Roland “Tiny” Rowland Lonrho ran into trouble for violating sanctions against white Rhodesia. Lonrho were not the only sanction-busting British company, but only the company of the German Rowland (birth name: Roland Walter Fuhrhop) suffered the consequences.

But while Rowland was making enemies in London, he knew how to do business in Africa and he made many friends among Black African leaders including Nelson Mandela and Zambia’s Kenneth Kaunda. Rowland sold a controversial stake in Lonrho in 1992 to Libyan leader, Colonel Gaddafy, while Libya was being accused of the Lockerbie bombing. In 1994, Rowland financed a film “The Maltese Double Cross – Lockerbie” which disputed Libyan involvement in the bombing.

That same year Rowland was forced out of the company he had managed for 32 years. Commodity prices had slumped and the company's debts threatened profitability. The company was split into two: Lonmin and Lonrho Africa, the latter retaining all the African businesses and mining assets. While Lonmin thrived and is now worth $US 8 billion, Lonrho Africa stalled. In 2005, David Lenigas was appointed as an ebullient CEO and co-chairman with a brief to restore Lonrho Africa as a first port of call for investment in Africa.

Lenigas is quickly rebuilding the business and diversifying into hotels and casinos. He was typically upbeat about the new deal with Countermine saying the partnership will add value to Lonrho’s growth strategy. He was also quick to point out that “by rehabilitating large areas of valuable land we will make a significant difference to African communities that have suffered terribly as a result of landmines”. Lenigas is hoping the ORACLE will provide a match between profits and philanthropy.


Anonymous said...

Hi Derek,

Interesting! Do you know how this join venture is proceeding? Have they started their work on demining?


Derek Barry said...

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