Life slows down in Chiatura

The mining town of Chiatura in western Georgia has already been cursed with poor conditions and self-serving owners. Now they’ve “temporarily” closed down the mines.


Mari Nikuradze
1 March 2016

Chiatura was a boomtown in the Soviet years. Brand-new cable cars criss-crossed this manganese-mining town in western Georgia, and each station had 12 workers per shift. After a decade-long hiatus, mining started up here again in the mid-2000s. These days, most shifts have just one worker, like Lali, on the upper hill and Lasha down on the street. They’ve worked on the same ropeway for years.

Now this life is under threat. Under a so-called “special regime” introduced by the international company that runs the mine, roughly 3,200 workers have been temporarily dismissed for four months — Lali and Lasha are two of the “lucky” employees to keep their jobs.

This decision has naturally raised suspicion among Chiatura’s mine workers and trade unions. While Georgian Manganese, the company involved, cites weakening international demand for steel and sufficient stocks of manganese ore to melt and produce for the next few months, most workers fear that the company won’t hire them back in four months time.

Once again, the Georgian people are appealing to the government to help — but to no avail

Meanwhile, Georgia’s parliamentary elections approach, and Georgian Dream, the ruling coalition, is trying hard to regain support. But its policies haven’t helped the miners of the Imereti region. As I reported several months ago, working conditions at Chiatura are abysmal, with few protections or avenues for recourse. In the nearby town of Tkibuli, a coal miners’ strike for wage compensation, which came after changes to income tax hit them in the new year, is only just coming to a close in light of a new agreement.

Once again, the Georgian people are appealing to the government to help — but to no avail.

Special regime

Mine workers and local trade unions have been hearing rumours that production would stop at Chiatura since last October. But while they couldn’t get straight answers from the company for months, their fears came true a few days before work was halted in January of this year.

Zakaria Zalikashvili, a spokesperson for Georgian Manganese, told me that there were several reason for the decision to halt production, including stagnant industrial processes in the global metallurgy sector and less demand for steel.

The company representative assumes the reason behind the fall in demand is the drop in oil prices. “Imagine, China, which is one of the largest suppliers of steel, has reduced steel production by 5.25% in 2015 compared to 2014.”

Once a Soviet boomtown, Chiatura has fallen on hard times in recent years. As an example, Zalikashvili referred to the Port Talbot steelworks in south Wales, which is owned by the Indian company TaTa Steel. This factory sacked 1,050 people in January (the steelworks lost 750), even though the company has enough financial reserves.

“We decided not to fire people and keep their positions,” Zalikashvili tells me, adding that the company has stored several hundred tonnes of manganese ore both in Chiatura and nearby Zestaponi, where Georgian Manganese owns a smelting plant. Work should be resumed from 20 May this year.
Miners assume that Georgian Manganese is attempting to switch to open-cast mining and shut down mines in the process 

As for Georgian Manganese, the company has been suffering since the beginning of 2015. Back in 2007 when the company entered the Georgian market, the price of manganese on the international market was $2,300. Today, according to Zalikashvili, the steel price is about $650. He claims exports have also dropped since last year.

Mine workers, however, don’t believe what the company tells them. They assume that Georgian Manganese is attempting to switch to open-cast mining and shut down mines in the process, releasing them from the burden of paying for workers’ uniforms, meals and insurance. 

Ore extraction in the mining town of Chiatura, western Georgia.When I asked Georgian Manganese about the prospect of open-cast extraction, Zalikashvili told me that those smaller companies have been extracting for several years already. They’re under no one’s control, he says. “They [small companies] violate regulations, like not recultivating after extraction. They require stricter control,” Zalikashvili said, adding that Georgian Manganese is a client of those small companies, but “not always”.

A threat from below

To find out about the special regime and the how it’s affecting people in Chiatura, I met with several people, including Lali and Lasha — the ropeway workers who managed to keep their jobs — at the local trade union in the centre of town.

As Lalia and Lasha tell me, there was misunderstanding about the conditions attached to the special regime —whether workers would still pay the 20% income tax on their reduced salary, the contract extension and when they’ll be paid. Instead of holding an open discussion, a representative from Georgian Manganese walked from worker to worker holding contract papers extending their terms for four months, asking them to sign it.

Chiatura's market only fills up on payday, and then only for a few hours.“When I asked if I could read the contract, he told me that there was nothing to read and I had to sign it otherwise I would lose my job,” Lali remembers. This way the company managed to get a signature from every single worker of the company.

Even those 500 people still working at the mine have signed the “special regime” contract. Pay day hasn’t yet come, and they’re wondering how much they’ll be paid. “We were told to sign the contract and after several days we would receive a notice that we were hired again,” Lasha told me. “Weeks have passed. We continue working, but we don’t know under what terms.”

“We continue working, but we don’t know under what terms”

Workers say that Georgian Manganese usually dismiss people who are soon going to leave for pension a few months in advance, paying them salaries for four or five months. They rarely hire new employees to replace the staff.

Archil, a mine worker, and Paata, a locksmith, have also joined me in this small but cosy room at the union office. They told me of how they’d filmed individual entrepreneurs, who are “multiplying like mushrooms”, extracting ore.

Ropeway operator Lasha is one of hundreds of workers at the Chiatura mines who suffers the consequences of the “special regime”

Indeed, it’s a common concern among Chiatura’s workers that soon Georgian Manganese won’t need them: small entrepreneurs extract ore far more cheaply with one or two employees; and sometimes they don’t even pay the workers.

“A few months ago, a man arrived from Kazakhstan,” Paata remembers. “He hired several locals and asked them to dig around their houses, but promised to pay enough money. A man can do lots of things for a bit of money, you know. The man collected the ore and left Georgia without paying a penny to those people.”

Naturally, fears of competition breed concern over job security. “We’ve heard that now they plan to dismiss about 700 people,” Paata says, adding that several other mines located nearby, such as Darkveti and Tsereteli, might close too.

Apart from the fear that company won’t hire them back, the greatest concern of the workers was lower income and their bank loans. According to Zalikashvili, the company negotiated with several banks to help employees with their loans. “We pay their credits for these four months, but then they have credits to us. We will prolong payment for these four months to six months so that it wouldn’t be hard for them to pay,” Zalikashvili explained.

Another protest

On 21 January, the day after the special regime came to force, up to 300 people rallied in front of the administration building in Chiatura. The main target of the rally was the government.

As Zalikashvili put it, the protesting workers want the government to pay them the rest of their salary for not working — over the next four months, Georgian Manganese will pay 60% salary to all its entire workforce. 

“It would require not more than three million lari [$1.2m] from the state’s reserve fund,” Paata tells me. He was also part of the negotiations with the company. “But we failed. People did not come out [to the protest]. This is our greatest problem.” Yet the rally had a positive result: the parties agreed that if worker’s salary is lower than the minimum wage ($100 per month), the company would pay those workers enough so that one received at least the minimum wage.

“There are people, like nurses, who receive 140-160 lari [$64-65] in this period. All in all, we’ve managed to snatch additional 75,000 lari [$30,500] from Georgian Manganese,” Lasha says.

Lali argued with her supervisor for weeks to be provided with a telephone for work. It was never installed, but she values the small victories.The issue of bank credits has also raised questions among mine workers. They say that Georgian Manganese actually reached agreement with TBC Bank, one of Georgia’s major banks, and claimed that it reached agreement with Bank of Georgia (BOG). Over the years, workers received salaries from Tao Private Bank and people had credits there. But several years ago BOG purchased and merged with Tao, and all the credits are now under BOG.

According to Paata, there are only 60 people who have credits at TBC: it was easy to reach an agreement. As for BOG, people cannot get clear answers from the bank on how their credit schedule will continue. “We’ve met the manager of our branch many times, but all they tell us is that the final decision has not yet been made,” Lali remarks.

Lali says that usually you can tell when people have been paid: the shops and streets are filled with people, paying off their debts at the markets

Archil, however, had credit at Bank Republic. Since it was another bank, he had to submit a special application to the company to halt payment of credit for four months.

“They agreed. I only had to pay interest rate and Georgian Manganese proposed to pay it for me, but to hell with them. I decided to pay my loan. It is only 24 lari [$9] per month and I’d rather pay it myself than later deal with those liars,” he says in a fury.

Life slows down

A long line of taxis stands on Chiatura’s main street. The drivers wait for passengers; several are mine-workers trying to earn extra money on the side.

We enter one of the large markets in the town centre. Two young girls sit behind the counter helping each other put on makeup — there’s nothing better to do. “Fewer people are coming,” they tell us. “Our boss made us stop selling food on credit.”

Chiatura market. For Lali, this situation takes her back to the 1990s, when the mine was closed. “When I was living in my village and moved to my apartment, which is half an hour’s drive away, I wouldn’t meet a single person in the street,” she recalls. “Of course, today it’s not the same, but fewer people are out on the street. It’s become more silent. The streets are empty.”

Lali says that usually you can tell when people have been paid: the shops and streets are filled with people, paying off their debts at the markets. “It lasts a week. Then it becomes quiet again.”

“The streets of Chiatura are empty”

We walk together through the markets and shops. The price of cheese has fallen — from eight lari to five or six. Most of the counters were empty. Some sellers leave early: they do not expect customers after four or five in the afternoon.

Lali and I walk into Sigulda, a small diner in the centre of town. It’s one of the few places to sit down and eat — it was empty. While waiting for our khachapuri, Lali tells me her story. She used to be a nurse, but has never earnt a living from her profession. She’s worked at Georgian Manganese since it reopened in 2005, and earns $108 a month. 

“I live with my daughter and granddaughter. My salary is our only income. Thank God I live on a farm; it helps us with food,” she says.

Despite her troubles, Lali insisted on paying for our dinner at Sigulda. “You are in Chiatura, my dear. How do you think we treat our guests?” she remarked proudly.

Chiatura plant. Lali has to start the machinery at the ropeway at 7:30 in the morning, and shuts it off at 23:30. The company has stopped providing transport, and allocates just two lari a day for travel. For those workers who travel from villages 20km away, it’s just not enough.

We visited the workstations of both Lali and Lasha. There are no windows in the tiny room, and the roof is leaking.

Lali proudly remembers how she fought with her boss from the administration to get a telephone. “They bought it, but didn’t install it. It was all in vain, but I am still happy every time I win those small fights,” she says.

Noisy machinery once functioned on every floor, but now it is completely empty and silent. Only the light bulbs were on

Later, the three of us visited the Itkhvisi enrichment plant, where Paata worked. It’s usually impossible to have a normal conversation there: you have to yell at the top of your voice to be heard. Noisy machinery once functioned on every floor, but now it is completely empty and silent. Only the light bulbs were on. From the upper floor of the plant, the small territory of one of the private entrepreneurs can be seen, with trucks loaded and ready to go.

Zakaria Zalikashvili told us that the company plans to use the four months of “special regime” to repair and refurbish plants and mines. But the plants are deserted. No one was there. Paata told us that there were people in the mines, replacing damaged wooden props to stop the tunnels collapsing.

Let the ballots do the talking

Malkhaz Tsereteli, the MP for Chiatura, has met with mine workers several times before and after the special regime was introduced, and has promised his help, raising the issues facing Chiatura with Georgia’s prime minister. “He doesn’t disappoint us. He’s an honest man. He does what he can do,” Paata says and Lali agrees.

Tsereteli is a member of the ruling Georgian Dream coalition, but is known for being critical. It is said that his colleagues in Georgian Dream, which came to power on the back of popular disillusion with the Saakashvili administration, complain that Tsereteli acts more like a member of the opposition than the governing party.

“The government is silent. Why we should vote for them? They have disappointed us”

Those active in trade unions are aware of the MP’s work, but most ordinary people aren’t: their hope in Tsereteli has soured. “If you ask them what they think of our MP they will say that he is a lazy man who has made his career and now is building some five-storey house in the capital,” says Paata.

Lali and Paata do not plan to vote for Georgian Dream in this year’s parliamentary election. “Who will vote for them? Come on, no one. I’d be surprised if anyone was satisfied with this government,” Paata begins. He says people do not see any alternative. “Let the government tell us what their plans are for Chiatura. They are silent. Why we should vote for them? They have disappointed us.”

“You know what? Georgian Manganese paid their taxes to Saakashvili before, now they pay them to Ivanishvili. That’s the only difference.”Paata says one MP is not enough to change things and the government doesn’t listen to people. “People feel that Chiatura is abandoned. Now we have to start taking care of ourselves.”

While the United National Movement, the former party of Mikheil Saakashvili, is unpopular here, there is also the Alliance of Patriots, who have a reputation as radical conservatives in Tbilisi. One of its leaders, Irma Inashvili, is the founder of Obiektivi, a conservative TV channel known for airing many homophobic and xenophobic statements.

Yet Obiektivi is the only channel in the country which has dedicated coverage to Chiatura. The whole town is watching it. Nevertheless, Inashvili’s party is unpopular here. They have only a small office; their representative is inactive.

The workers I spoke to remember how people built their hopes on Bidzina Ivanishvili, the billionaire businessman behind the ruling Georgian Dream coalition. Ivanishvili’s home town is not far from Chiatura. And in 2012, the town’s miners recorded footage of their working conditions and a personal appeal to the reclusive billionaire — to little effect.

“You know what?” concludes one resident, “Georgian Manganese paid their taxes to Saakashvili before, now they pay them to Ivanishvili. That’s the only difference.”

All images courtesy of the author. 

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