Land Acquisition and Resettlement - Mining and the Environment: From Ore to Metal - page 583

Displacement comprises both physical and economic displacement. Physical displace-
ment occurs where the inhabitants must be relocated in order for the development to pro-
ceed. Economic displacement occurs where a project causes loss of livelihood, regardless of
whether or not there was physical displacement.
Eminent domain is the term given to the power of the State to expropriate property or
restrict land use without the owner's consent. In some States, the right of eminent domain
is a last resort used only after negotiations have failed. Under many jurisdictions, eminent
domain procedures may be very time consuming, leading to signii cant project delays.
Negotiated settlements are those achieved by provision of fair and appropriate compen-
sation, plus other incentives and benei ts to affected persons and communities, and by miti-
gating the risks of unequal access to information and bargaining power. Included in these
negotiated settlements are 'willing buyer - willing seller' transactions, which perhaps are
more common in developed countries. IFC PS 5 does not apply to these voluntary transac-
tions. However, other social impact requirements as in IFC PS 1, still apply.
Compensation refers to measures to compensate for resettlement losses and may include
cash payments or compensation in kind (such as 'land for land'). Decades of international
experience in resettlement suggest 'land for land' compensation alone, although preferable,
is seldom fully accepted by displaced people; they often demand cash payments. As a result,
most compensation schemes provide compensation in both cash and non-cash forms.
Livelihood restoration refers to measures aimed at restoring the livelihoods of affected
people after they have being compensated for resettlement losses. There is a clear difference
between compensation for losses and techniques for providing livelihood streams/ income
replacement or community benei ts. IFC PS 5 and its predecessors require compensation
for land and lost assets in the i rst instance plus measures to restore livelihood. One is not a
substitute for the other.
According to IFC PS 5, displaced or affected people include those '(i) who have formal
legal rights to the land they occupy; (ii) who do not have formal legal rights to land, but do
have a claim to land that is recognized or recognizable under national laws; or (iii) who
have no recognizable or legal right to the land they occupy'. Displaced people are not the
only people directly affected by the mine; host communities too may suffer. Social conl icts
are likely to arise when a large population is displaced onto the land of a smaller existing
population. There is always the need to investigate the capacity of the host area to sustain
a resettled population without serious resource depletion. Important factors to consider
include availability of clean water (in all seasons); amount and productivity of agricultural
land; health services; school system; sewage disposal and water delivery systems; road net-
work; law enforcement services; and utilities.
A resettlement plan dei nes the policy applied to resettlement, the magnitude and sever-
ity of resettlement losses, approaches to compensation, and measures applied for livelihood
restoration. It provides important protection to displaced people and to the company dis-
placing them - where legal rights to land are poorly dei ned; where legislative or institu-
tional frameworks are weak; where land markets are poorly developed or in a formative
stage; where there is no institutionalized social safety net; and where displaced people may
have limited or no access to legal remedies and protection in the event of a dispute.
Resettlement is an important component of the Equator Principles with the 'Land
Acquisition and Resettlement Action Plan' (LARAP) document one of the key public
documents to be prepared by proponents. While virtually all mining projects require the
acquisition of land, physical resettlement of people from this land is not required for all
or even a majority of mining projects. However, it is important to understand that the
Equator Policies are applicable, even where there is no physical resettlement of people. In
developing countries and in developed countries where the interests of Indigenous Peoples

Displaced people are not the
only people directly affected by
the mine; host communities too
may suffer.

The Equator Policies are
applicable, even where there
is no physical resettlement of
people.