Søren Lyberth, a hotel owner in Maniitsoq, has made headlines both in Greenland and Denmark suggesting a brothel to secure some income to the city with 2,784 inhabitants (2010), if American Alcoa Inc, the world’s third largest producer of aluminum, get permission to import 2,000 low wage workers from China to build a new aluminum smelting plant in the small city, which actually is the sixth largest in Greenland.
By his suggestion he has not only ignited a heated debate, with all the the general pros and cons prostitution arguments, but also brought the debate on use of underpaid imported labour, so-called social dumping, out to a much wider audience.
Thursday the Greenlandic government submits it draft law on works at large-scale projects such as London Mining iron mine in Isukasia and Alcoa’s aluminum smelter at Maniitsoq. The draft law sets hourly wages for foreign workers in the construction phase to SIKs minimum wage of 80.41 DDK, but with limited rights. Companies may offset the cost of accommodation and meals, and the staff won’t have same rights regarding holidays, working hours etc.
“Government breaks democratic rules”
The union in Greenland accuse the government for breaking democratic rules and traditions by working hidden on this special law to pave the way for cheap labor to large-scale mining projects in Greenland.
“I will take contact to the employers’ organization and ask them to seriously consider whether we should continue to participate in the trilateral talks, which have hitherto been customary between the government, the employers’ organization and the union,” Jess G. Berthelsen, chairman of Greenland’s union SIK, writes in a press release.
Threatens to cancel investment
Alcoa Inc. is not alone in demanding low wage labour as a condition to invest in Greenland. London Mining, who wants to open an iron mine northeast of the Greenland capital Nuuk demands decisions from Greenland both on permit to start mining and on conditions for importing labour.
“You can not postpone a decision! If you wait, investors will pull their money out of the project and take them somewhere else,” project director Xiaogang Hu said to KNR, Greenlandic Broadcast corporation, and he added, that he himself does not want to wait any longer for political commitment.
London Mining’s expect to invest 30 billion DDK (5.2 billion US$) financed by Chinese investors.
“A project of this size has huge potential for Greenland. It will create lots of job opportunities for the next generation of Greenlanders. It will lift education and essential change Greenland’s position in the world, said Dr. Xiaogang Hu to KNR.
“Process a farce”
It’s not just the union and local employers who criticize the government for uncritical satisfying the two multinationals requirements and wishes. Environmental NGOs has called the authorisation process of the mining project a farce.
“People have had no chance to express their views on the London Mining project, as the EIA and SIA processes (“Assessment of Environmental Impact” and “Assessment of the Social Sustainability”) haven’t been submitted for consultation,” says Piitannguaq Tittussen, chairman of ”Nuuk Fjords Venner” (Friends of Nuuk inlet).
Changing the hydro power act
Besides allowing lesser right for low paid Chinese workers, the Greenlandic parliament also has to decide if their want to change the hydropower act, to give Alcoa a concession period of 60 years on hydropower with a 20 years extension options and making it voluntarily to deliver power to the local community.
The current legislation only permits a 40 year concession period without right to but only possibility for extension and imposes sale of surplus electricity to the local community. Further more the draft law will allow Alcoa to mortgage the hydropower facility and hence the concession.