2010
AMBATOVY SUSTAINABILITY REPORT
33
C2.3 Market Presence
Local Job Creation
Ambatovy has made local job creation a priority in our
strategy to invest in Madagascar’s development. We are
committed to providing quality jobs with opportunities for
training and advancement. Since Madagascar’s workforce
could not provide sufficient numbers of highly skilled
personnel required by the Project, we began a ramp-up
program even in the construction phase that will see national
employees progressively hired and trained to fill positions
currently occupied by expatriates. Ambatovy’s standard
entry-level wages start at 185% of the minimum wage in
Madagascar, with opportunities for promotion and increases
in pay. Ambatovy endeavours to attract the best of local
talent and invest in the growth of our employees. For detailed
information on hiring practices and our local employment
statistics, see section C4.2.
In October 2010, an external research company carried
out a study on the expansion of local businesses and jobs
in 2009/2010. The study found that economic stimulation
from Ambatovy had created more than 7,400 jobs in local
businesses, including informal, small and medium-sized
enterprises. This figure takes into account sub-contracted
operators, including local suppliers, and non-contracted
businesses, such as restaurants and shops that have
increased sales due to the Project. These jobs were in
addition to the Project’s direct, on-site jobs.
Local Suppliers
Ambatovy has quickly become one of the largest consumers
of goods and services in Madagascar. By maximizing local
procurement, Ambatovy aims to provide a much-needed
boost to Malagasy entrepreneurs. Over the entire construction
period up to the end of 2010, Ambatovy signed more than
$1 billion in contracts with national and local companies.
While the most significant supplies for operations will be
commodities that currently must be imported, such as coal,
sulphur and limestone. We are working to create opportunities
for local businesses to participate in our supply chain for the
operations phase.
The Ambatovy Local Business Initiative (ALBI) was created
to promote the Project’s “buy locally, hire locally” policy. Its
main purpose is to contribute to job creation through the
support and development of local industry, while maximizing
local economic benefits. To this end, ALBI works closely with
Ambatovy’s Supply Chain Management Department to identify
local companies capable of responding to the Project’s needs.
ALBI and the supply chain team have created a local
purchasing policy for the Project, augmenting employment
opportunities in local enterprises. There were several notable
local purchasing projects in 2010:
3
Plant site uniforms were manufactured through two
local businesses. ALBI’s goal is that the two sewing
workshops become fully independent in 2011. A similar
project to procure mine site uniforms locally will be
implemented in 2011 in Moramanga.
3
Three fruit, vegetable and dried product purchasing
centres were operational in 2010, two in Toamasina
and one in Moramanga. These purchasing centres
were created to respond to the Project’s food needs
and decrease pressure on local prices. An estimated
5,000 producers from the surrounding regions and an
additional 3,000 from other regions of Madagascar
supplied them with over 1,200 tonnes of vegetables in
2010. Total purchases were nearly US $1.4 million.
3
Ambatovy created a special project, which is in
the initial stages aiming to utilize a local pine
forest concession to produce pallets for product
transportation. The wood will be produced by a local
company with Forest Stewardship Council certification.
Not only will this reduce the environmental footprint of
our packaging, but it will also create a range of jobs in
forestry and manufacturing.
3
Once operations start, Ambatovy will need 80,000
metal drums and 80,000 bags a year to pack and
transport refined nickel and cobalt. ALBI identified
potential suppliers, obtained samples and selected
a local company to manufacture the drums and
bags. A new production line has been designed and
the assembly line is expected to start up in 2011.
The company will hire 30 more workers to handle
production.
LOCAL Purchasing Centres
Given the high number of new employees at the mine,
Ambatovy realized early on that it would need to find
a way to feed employees high-quality produce without
fuelling inflation of local market prices. The purchasing
centres (
centrales d’achats
,
CA
s) were established with
this in mind. These are Malagasy-run ventures that are
well on their way to being autonomous.
The CA serving the mine in Moramanga aims to bring
local producers into the fruit and vegetable supply
chain. It works with five different producer associations,
which it helped to create with ALBI. Currently, 80% of
its suppliers are local farmers. The other 20% are from
other regions of Madagascar, supplying those items that
cannot be grown in the region. Step by step, farmers
are starting to specialize in high quality fruits and
vegetables. Each week the CA receives two tonnes of
prime produce from its farmers.
There are many challenges for small-scale farmers
in Madagascar, not least of which are excess local
supply, low prices and lack of alternative markets. Mr.
Narson Rafidimanana, the director of the CA, has big
plans, hoping to expand beyond Ambatovy and enter
into the national supermarket supply chain. As the
mine transitions to operations and has changing food
supply needs, the CA is seeking other downstream
outlets for its local producers. This will create access
to a market that had previously been out of reach for
small-scale farmers.
C2. Economic Performance
