Impacts of foreign investment on sustainable development in a Chilean mining region

The desert mining region of Antofagasta, Chile, enjoyed spectacular economic growth in the 1990s as a result of foreign direct investment (FDI), mainly in the exploitation of the region's rich copper deposits. In a country considered by international financial institutions to be a good example of economic performance, Antofagasta has been termed a model region,and Chile's economic and social development in the 1990s has been considered a suitable model for other Latin American countries. However, development indices based on statistical data must be examined with caution, as human welfare does not necessarily keep pace with economic growth. This article analyses the Antofagasta Region in terms of problems that may occur in conjunction with accelerated economic growth, and how these can affect the environment, as well as the regional labour market. The article also examines a regional economic strategy for Antofagasta recently proposed by the local government, and suggests new alternatives for the sustainable economic development of the region.     

Mining and development in the region of Antofagasta

The objective of this paper is to analyse the effect of mining on economic and social development in the region of Antofagasta from 1985 to 2008. Analysis of development is restricted to spheres described by available indicators used by several international and non-governmental organizations such as income distribution, education, health, poverty, human development and security, satisfaction, cost of living, income per capita, GDP per capita, employment, productive activity, added value and its distribution. Correlation between some of these variables is estimated as well as the gap between these indicators and those of developed countries.     

The mining industry in the European Union: Analysis of inter-industry linkages using input–output analysis

Input–output modelling is a useful tool in policy analysis and economic planning. This methodology is used to detect the inter-industry linkages known as forward and backward linkages. Examination of these measures provides one mechanism for identifying “key” or “leading” sectors. The main objective of this paper is to measure the linkages of the mining and quarrying industry in the European Union (EU) and to determine if any of the industry subsectors can be considered key sectors. The paper shows that three subsectors can be considered key sectors: the mining of coal and lignite and extraction of peat in Germany; mining of metal ores in Sweden; and other mining and quarrying in Austria, Denmark and Spain. These sectors are more stimulated by overall industry growth than other sectors and have greater impacts in terms of investment expenditures on the national economy than other sectors. The values of the forward and backward linkages show that the mining and quarrying is an industry that would be stimulated by an increase in a regional economy's production more than other sectors, while an increase in the mining and quarrying industry's output would not stimulate this regional economy more than an increase in other sectors.     

Using discrete choice experiments to assess the preferences of new mining workforce to commute or relocate to the Surat Basin in Australia

Two choice modelling experiments have been used to examine how residents of a major urban centre would consider commuting or relocation options if they were to consider taking up employment in a rapidly growing resource region. The case study area focused on the Surat Basin in southern Queensland where recent increases in mining activity involve both coal mining and coal seam gas extraction. The preferences of residents of Brisbane, the state capital and closest major centre to the Surat Basin, were assessed in the experiment. The results identified increased salary as the most important factor, but respondents were also concerned about potentially offsetting influences such as high living costs and accommodation affordability/availability. Respondents indicated that the additional salary needed to take up employment in the Surat Basin was substantially higher for relocation options than for FIFO options.     

Environmental impact of mining in Ghana: issues and answers

As part of the process of drafting environmental guidelines for mining, a study of the impact of mining on the environment was undertaken by the Ghanaian Minerals Commission. The study evaluated the impact of underground mines and surface mines on the physical environment as well as their socio-economic impact. Among its conclusions: for both types of mines, drainage emptying out into rivers is a major cause of pollution; mine roads open up uninhabited regions to farming and other uses. Underground mines employ more workers than surface mines; the socioeconomic benefits of the surface mines to local people are less than those of underground mines.     

The challenges of sustainability in mining regions: The coal mining region of Santa Catarina, Brazil

Throughout history, mining communities have invariably found themselves striving for a good quality of life and a long‐term future. In the 21st century, problems of maintaining the economic vitality of mining regions are now compounded by concerns about the biophysical integrity of the local environment. In regions of the world where the economic viability of the resource is marginal and achieving a reasonable quality of life is a daily struggle, sustainable mining may seem to be a dubious prospect at best. Yet the twin imperatives of global political forces and burgeoning environmental concerns are requiring industry, governments and other interests to re‐conceptualize the way in which mining takes place in communities. Although mining itself may not be seen as an industry that contributes to the achievement of environmental objectives, it could — with careful planning — be used as a tool to foster a more sustainable and healthier community. This argument is considered in the context of the coal mining region of Santa Catarina, Brazil.     

Status and trends of freshwater wetlands in the coal-mining region of Pennsylvania,USA

The impact of surface mining for coal on the nature and extent of freshwater wetlands was assessed on 73,200 ha in western Pennsylvania. The influence of mining on wetlands was not uniform across physiographic regions, varying with regional differences in hydrology and soils. Overall, mined lands supported 18% more palustrine wetlands than unmined lands, primarily because of a 270% gain in permanent, open-water wetlands on mined lands in the glaciated region. Open-water wetlands declined on mined lands in unglaciated regions owing to unfavorable hydrologic conditions. The number and size of emergent wetlands declined as a result of mining. Mined lands supported 81% fewer riverine wetlands than unmined lands. This was caused primarily by avoidance of lands containing streams, and secondarily by a 10% reduction in replacement of riverine wetlands during reclamation. Land managers need to develop land use policies that maximize the ecological and social benefits that can be derived from developing diverse wetland communities on mined lands.     

The relationship between mining and socio-economic well being in Australia’s regions

This paper examines the relationship between quality of life indicators and the gross value of minerals production from Australian regions. We used quality of life indicators, aggregated for 71 local government areas containing mining activities, of household income, housing affordability, access to communication services, educational attainment, life expectancy, and unemployment. We find no evidence of systematic negative associations between quality of life and the gross value of minerals production. Instead, mining activity has a positive impact on incomes, housing affordability, communication access, education and employment across regional and remote Australia. Whilst we do not establish causality between mining activity and quality of life, our analysis prompts a rethink of the resource curse as it applies within a single country. We did not find evidence of a resource curse, at the local government level, in Australia’s mining regions. Nevertheless, we note observations by many other researchers of negative social impacts on specific demographic sectors, localities, families of fly-in fly-out mining operations, and individuals. This contrast may be a scale issue, with the regional benefits of mineral wealth masking highly localised inequalities and disadvantage. We suggest that there is a need to better understand these impacts and, more importantly, the types of policy mechanisms government and industry can adopt to mitigate or avoid them.     

Australia's uranium

Australia's uranium comprises about 18% of the Western World's reasonably assured reserves. Mining, milling and export have been proceeding since the federal government's decision in August 1977. The timetable for development of several other projects involves matters such as environmental issues, approval by the aboriginal people and mining practice policies. The author discusses the background to present uranium mining in Australia and examines the industry's likely international significance.     

Community Perception of Water Quality in a Mining-Affected Area: A Case Study for the Certej Catchment in the Apuseni Mountains in Romania

Mining-contaminated sites and the affected communities at risk are important issues on the agenda of both researchers and policy makers, particularly in the former communist block countries in Eastern Europe. Integrated analyses and expert based assessments concerning mining affected areas are important in providing solid policy guidelines for environmental and social risk management and mitigation. Based on a survey for 103 households conducted in a former mining site in the Certej Catchment of the Apuseni Mountains, western Romania, this study assesses local communities’ perceptions on the quality of water in their living area. Logistic regression was used to examine peoples’ perception on the quality of the main river water and of the drinking water based on several predictors relating to social and economic conditions. The results from the perception analysis were then compared with the measurements of heavy metal contamination of the main river and drinking water undertaken in the same study area. The findings indicate that perception and measurement results for the water quality in the Certej Catchment are convergent, suggesting an obvious risk that mining activities pose on the surface water. However, the perception on drinking water quality was little predicted by the regression model and does not seem to be so much related to mining as to other explanatory factors, such as special mineralogy of rock and soils or improper water treatment infrastructure, facts suggested by the measurements of the contaminants. Discussion about the implications of these joint findings for risk mitigation policies completes this article.     

Risk attitudes and mitigation among gold miners and others in the Suriname rainforest

This article analyses the question: do attitudes towards risk influence participation in small‐scale gold mining, a hazardous activity that generates uncertain income? This question is examined by measuring and comparing the risk attitudes of gold miners and non‐mining community members in the rainforest of Suriname, South America. The author presents a multivariate model to predict the duration of work in mining areas as a function of risk tolerance, age, education, and household demographics. The results suggest that a greater tolerance to risk increases the duration of a person's mining career. However, attitudes explain only a fraction of the variation in occupational choices. Qualitative data suggest that these choices are primarily shaped by local barriers to human capital development and by national economic volatility. Given their marginal position in society and the multitude of mining risk mitigation strategies, it is questionable whether gold mining exposes Suriname forest peoples to greater risks than other subsistence alternatives. The author argues that sensitivity to local historical and cultural conditions would improve the efficiency of policies aimed at developing a more sustainable mining industry. By zooming in on the daily lives of miners, anthropology can complement macro‐scale analyses and contribute to policy interventions in the small‐scale mining sector.     

Economic and social effects analysis of mineral development in China and policy implications

Mineral development has contributed greatly to China's economic and social development. Many challenges remain, however, including environmental pollution and resource waste in practice, as well as a dearth of systematic theoretical research. The goal of this study is to analyze the economic and social effects of various mineral developments in China from diversified perspectives, so as to provide the basis for the formulation of China's mineral development policy. The input–output effects, industrial linkage effects and income distribution effects of different mining industries are quantitatively analyzed by adopting basic hypotheses of input–output economics, industrial linkage model and income distribution antitheses based on the latest available official data from China Statistical Yearbook from 2004 to 2010 and the 2007 Input–Output Table of China. The empirical results obtained in this study indicate that all mineral development industries, especially coal mining and washing, and petroleum and natural gas extraction industries, have given a strong impetus to the increase of China's fixed asset investment and GDP. Moreover, they have provided a large number of jobs, thereby alleviating ongoing employment pressure, and they have also played a positive role in promoting China's technology investment. The analysis of industrial linkages demonstrates that mining industries are basic to the national economy and produce a significant impetus to its downstream industries, but create weak pull effects in terms of national economic development. From the perspective of income distribution, mining industries play an important role in increasing China's fiscal revenue and per capital income. Hence, China's mineral development policy should (1) encourage additional investment in technology for exploration and development to insure sufficient supply and expand the input effects; (2) attract additional talent to work in remote regions; (3) optimize the industrial structure and promote the industrial transformation in resource regions; (4) adjust the interest distribution between the central and local governments to enable the local regions to become more self-sufficient; and (5) enhance the legal environment so that companies can more readily undertake their social responsibilities voluntarily.     

The regional impacts of small-scale gold mining in Amazonia

Gold mining is the major economic activity in the Upper Tapajós River Basin of the Brazilian Amazon. This article studies the structure, economy and impacts of gold mining operations in this region. Mining has significant environmental impacts in this region resulting in the removal of approximately 67 million m³ of sub-soil per year and accompanied by an annual release of some 12 tons of mercury to air, ground and rivers. In the early 1990s there were 245 mines in operation, employing some 30000 people and producing around 35t gold per year, valued at approximately $400 million yr^-1, the profits being about $110 million yr^-1. Miners spent most of their earnings on local goods and services, while mine owners and merchants in the gold towns invested in land (mainly for ranching), business ventures and money markets. Wealth gained from mining has served as an engine for development in other regions of the world and could, theoretically, achieve the same for Amazonia. However, before this could happen, the Government of Brazil would need to mark a strong presence in the area by providing technical assistance and developing and enforcing mining/environmental regulations. The likelihood of such a development materializing in the foreseeable future is small. In the meantime, gold mining acts, not as an 'engine for development', but as a destabilizing force — provoking environmental damage, social discord and public health hazards in the region.     

Gemstone mining as a development cluster: A study of Brazil’s emerald mines

For many centuries, emeralds have bejeweled the rich and famous all over the world. Emeralds have also made many millionaires overnight, sometimes by chance, as in some of the cases reported in this study. On the other hand, even though emerald mining has brought some economic benefits, many of these have remained at the top of the production chain. In many cases mining activities have caused a number of negative social and environmental impacts locally. Working conditions in small mines are very poor in general: with bad ventilation, high temperatures, long working hours, lack of safety, informal working contracts and no health or life insurance. Environmental impacts can be significant, such as widespread deforestation, erosion of abandoned mines, and soil and water pollution in streams. The economic and social public benefits can be minimal. Even when taxes on gem mining are relatively low, much of the mining local activity is informal and the high value-added formal activities take place outside the mining regions. This study aims to understand the dynamics of emerald mining and its impact on local development using the concept of clusters. The research analyzes three case studies in Brazil: Campos Verdes/Santa Terezinha (Goias state), Nova Era/Itabira (Minas Gerais state) and Carnaiba/Campo Formoso (Bahia state). Emerald mining regions attract many migrants, increasing the demand for public services (infrastructure, health, education, etc.), but local governments are unable to provide for them because the activity produces little tax revenue. In the end, there is a growing mismatch between demand and supply of public services, leading to a series of social and environmental problems. However, working with the concept of cluster can help to shed light on policies to improve the local benefits of gem mining, by organizing the miners and their supporting organizations to allow investments that bring long term benefits locally.     

What determines the breadth and depth of Zambia's backward linkages to copper mining? The role of public policy and value chain dynamics

This paper investigates the dynamics of upstream linkages development to copper mining in Zambia. The breadth and depth of the local mining supply chain was deeply shaped by policies adopted in the 1990s under the Structural Adjustment Programme. These policies succeeded in attracting much-needed FDI in the mining sector, including Chinese and Indian FDI, but had a negative impact on the level of value-addition undertaken by local suppliers. In the post-privatisation era, the dynamics of the local supply chain suggest that supply firms' upgrading and sales growth were determined by firm ownership and value chain governance. In fact, forward linkages to buyers other than Chinese and Indian mining companies, and backward linkages to parent companies and technology providers were critical in supporting supply firms' success in the mining value chain.     

Social-environmental certification: Sustainable development and competitiveness in the mineral industry of the Brazilian Amazon

This article examines the relationship between increased metal mining and sustainable development in the eastern section of the Amazonian state of Pará in Brazil. Since the early 1980s, mining has grown rapidly in Pará and local mining operations have become global leaders in the production of iron, manganese, bauxite, aluminum, gold, copper and — in the near future — nickel. To stay in tune with global standards, these companies have committed themselves to the principles of sustainability and have obtained certification for both social and environmental aspects of their activities. The article looks into whether such certification is linked to sustainable development of the relatively poor regions where these companies operate. The main findings are that: (1) there is a visible association between certification and improved performance by the companies, but not with the development of nearby areas; and (2) social‐environmental certification processes place more emphasis on ecological variables than on social ones.     

Simulating Direct and Indirect Damages to Commercial Fisheries from Marine Sand Mining: A Case Study in Korea

Rapid growth in marine sand mining for construction and other uses poses environmental challenges to coastal nations virtually worldwide. Yet the development of management policies, such as a system of fees imposed on operators for damage caused by mining, has been frustrated by a lack of studies to support such measures. Adapting a Beverton-Holt bioeconomic model, this paper attempts to contribute to the estimation of external costs to commercial fisheries due to marine mining. Using the major mining area of Ongjin in Korea as a case study, we estimate economic losses in use value of commercial fisheries through the time to recovery of the injured resource stocks. Present value of lost catch over a 1-year period from mining to resource recovery is estimated at $38,851 for a single “prototype” mining site. Estimated cumulative damages due to recurring mining for 5 and 10 years are $1.5 million and $2.2 million, respectively, at 20 mining sites. Sensitivity analyses are used to examine the effects of alternative assumptions to assess the many sources of uncertainty. Using a form of meta-analysis, dose-response information is used to assess the excess mortality the mining sediment plume has on eggs and larvae and, ultimately, on the value of lost catch ($841). Also addressed is the importance of specifying the appropriate “premining” conditions against which to assess environmental losses at the mining site. Damages estimated with premining fish populations are $23,066 higher than is the case using postmining conditions. Overall, the illustrative results suggest the variety of complex conditions which influence damage to fisheries from mining and which can benefit from further study to improve management guidelines. An erratum to this article can be found at     

Informal coal mining in Eastern India: Evidence from the Raniganj Coalbelt

Unauthorized mines are not uncommon in mineral-rich regions of poorer countries, and India is no exception. Whether they constitute merely a law and order problem including safety issues, or there are important social and economic questions involved has yet to be thrashed out. The mining industry, at regional, national and international levels, is ambivalent towards such mining, tending to draw attention away from their informal nature to the size factor.
This article looks into the problem of such informal mining in the light of empirical surveys in eastern Indian collieries. These are called peoples' mines and they serve a significant purpose in local economies. The article's thesis is that peasant communities are trying to claim back a portion of the local resources lost to them through appropriation by mining companies thus re-asserting their traditional rights to local mineral resources. In conclusion, the need for a new moral economy for mining regions is stressed: an economy in which local communities will play a powerful role.     

Financial assurance and mine closure: Stakeholder expectations and effects on operating decisions

Financial assurance is increasingly seen as a means to ensure orderly, clean and lasting closure of mines. Broadly interpreted, “closure” requires leaving viable ecosystems on mining lands that are compatible with a healthy environment and with human activities, that have low hazard, and that encompass measures to prevent ongoing pollution from the site in the long-term. Financial assurance encompasses environmental surety instruments that protect the government and public in the event a mining company cannot meet its reclamation or rehabilitation obligations. As such, financial assurance is in essence the money available for closure of the mine in the case when the mine owner is not available to perform the work. A general trend towards greater environmental concern among social stakeholders in mining further serves to focus attention on policies and practices that can actually “assure” financial assurance.Financial assurance is also perceived as a means to address closure-related challenges that are increasing in number as well as diversity. Notably, current trends involve a shift towards a greater focus to the societal aspects of mine closure rather than just the ecological. The use of financial assurance, however, also raises some fundamental questions about how assurance mechanisms influence mining operations and the relationship between mining operations and their surroundings. This paper examines both the internal effect of a variety of financial assurance approaches on mining operations—in particular the manner in which environmental and social concerns are addressed by mining firms, and the almost inevitable tension between some form of financial provision for closure on the one hand, and governmental expectations of tax revenue on the other. As a major argument for supporting the conduct of mining is that state revenues from the extractive industries supply monies for the building of human and infrastructural capital, this second area of tension also has strong social and developmental overtones.     

Toxic mercury versus appropriate technology: Artisanal gold miners’ retort aversion

Mercury-usage in artisanal and small-scale gold mining (ASGM) has accelerated in developing countries during the last thirty years resulting in negative environmental and health impacts. As awareness of mercury contamination from ASGM has grown, a number of strategic initiatives have been introduced to reduce the impact of the toxic substance. The adoption of the retort, a device capable of recycling up to 95 per cent of mercury in gold extraction, constitutes a broadly recognized approach. Based on case-study research in Tanzania, this paper examines an ASGM area, which has been targeted by several mercury-reducing efforts. Based on survey data, key informants interviews, and visitor observations, the paper examines the impact of these efforts on mining techniques and residents’ attitudes towards the use of mercury. Despite the seemingly obvious advantages from adopting retorts or other mercury-reducing techniques – economic, environmental, and health-wise – miners continue to use mercury haphazardly, while demonstrating an only limited awareness of the toxicity of the substance. The paper discusses the possible explanations behind this as well as possible ways forward in facilitating the reduction of mercury in ASGM operations.