Privatizing the minerals sector

The end of the Cold War presents new challenges for the dynamics associated with mineral resources development. Broader approaches are needed to help mineral rich developing countries develop their minerals sector. These countries need to embark upon programmes of policy reform and privatization in order to make their mineral resources industries more efficient and responsive to free market forces (such as supply and demand and price), and to turn mineral sector decision making over to the private sector. This article examines the use of policy reform and privatization strategies to increase mineral resource production in developing countries, thereby contributing to both developing country economic growth and developed country access to mineral supplies .     

THE STATE PETROLEUM ENTERPRISE AND THE TRANSFER OF TECHNOLOGY

This article examines the potential of State Petroleum Enterprises in the developing countries for taking a lead in transfer of technology. After examining the reasons behind the growing demands for technology transfer, the paper defines the content of this technology and the means by which it can be transferred. In spite of reluctance on the part of the developed nations and the multinational oil companies to part with petroleum technology without an economic or political concession from the developing countries, much of this technology is either in the public domain or for sale by small speciality companies. The Enterprises can buy this technology and they can contract with specialty firms for operation with their countries. Of foremost importance is the education of nationals and development of indigenous group familiar with the scientific basis and specific techniques of petroleum technology.     

PETROLEUM IMPORTING DEVELOPING COUNTRIES: A NEW OIL FRONTIER

The majority of developing countries depend on imported petroleum to fulfil most of their energy requirements. Many are not able to do so without substantial assistance from abroad. Meanwhile, various studies indicate the existence of a large undiscovered potential of petroleum resources in these countries. In the following article, the authors review some of the proposals for assistance to petroleum importing developing countries, and, at the same time, launch their own proposal for a modest exploration programme in the least developed countries which could enable them to become self-sufficient in petroleum in the near future.     

The World Bank and Petroleum Development in the Third World

The issues that arise between state sovereignty over natural resources and the desire of the State to finance the development of its petroleum resources from external sources are briefly examined. The problem is particularly acute for the least developed countries. It is suggested that financing obtained from international agencies such as the World Bank, may provide a means for such countries to maintain full sovereignty over their petroleum resources and at the same time obtain needed financing. To this end the petroleum lending activities of the World Bank are examined both in terms of policy and in terms of the financial resources available. A special lending facility to help underwrite financial risk of petroleum exploration in the least developed countries is proposed.     

LONG-TERM COPPER PRODUCTION OPTIONS OF THE DEVELOPING COUNTRIES

After petroleum, copper is the most important foreign exchange earner of the developing countries. Supply of copper from developing nations is heavily concentrated in six countries. The production strategies of these countries can, therefore, have a significant impact on world copper trends as well as on their own copper earnings. The author, former Chief Economist of CIPEC, examines the implications of two alternative growth paths for long-term copper production in these countries.     

International oil market – new directions

This article focuses on changes in the international petroleum industry during the past 20 years and examines some major trends, especially since the oil price collapse of 1986. The resumption of rapid increases in oil demand since 1986 in the developed market economies and the developing world has already led to a pronounced production shift to OPEC member countries where output increased by 6.6 million barrels per day or, 37% since 1985. Cutbacks in petroleum investments in non-OPEC countries are likely to result in even more dependence on the vast proved oil reserves of OPEC. However, the gap between peak output and sustainable production capacities in OPEC has narrowed and there is an urgent need for sizeable investments to expand capacities. Such investment programmes are already being implemented by transnational oil corporations in countries such as Indonesia and Nigeria where the companies had retained equity participation. In other countries such as Iraq and Venezuela where oil operations had been nationalized, transnational oil corporations are being invited to participate in new arrangements for oil production. New arrangements are also being considered in Eastern Europe and the USSR. New understandings, dialogue and cooperation between oil-consuming and producing countries will be necessary for the security of investments, supplies and markets in this process. The unanswered question is whether such cooperation can be achieved in time in order to avoid yet another energy crisis.     

ASPECTS OF PETROLEUM TRANSPORT IN DEVELOPING COUNTRIES

Dramatic changes in the institutional structure of the international oil industry in recent years have created new responsibilities and opportunities for developing countries in petroleum transport. The article discusses the prospects for changes in the ownership/control pattern of seaborne oil movements and the need for both oil producing and oil importing developing countries to pursue national plans to acquire shipping tonnage and expertise, without being deterred by the present depressed conditions of the world shipping industry. Drawing from the experience in India, it deals with some features and problems of petroleum transport by sea, pipeline, rail and road. It stresses the importance of co-operation among developing countries through common operation of deep-water terminals and large size tankers to optimise transport costs.     

The resource curse

Countries that possess rich mineral deposits, it is widely assumed, are fortunate. Such deposits are assets, part of a country's natural capital. Mining is the key that converts dormant mineral wealth into schools, homes, ports, and other forms of capital that directly contribute to economic development. Over the past two decades, however, a more negative view of mining has emerged that questions the positive relationship between mineral extraction and economic development. The impetus for the alternative view came from empirical studies suggesting that countries where mining is important have not grown as rapidly as other countries. More recent studies have explored the possible reasons behind the disappointing performance of many mineral producing countries. While the central point of contention between the conventional and alternative views — namely, whether or not mining usually promotes economic development — remains unresolved, there is widespread agreement that rich mineral deposits provide developing countries with opportunities, which in some instances have been used wisely to promote development, and in other instances have been misused, hurting development. The consensus on this issue is important, for it means that one uniform policy toward all mining in the developing world is not desirable, despite the recent suggestions by some to the contrary. The appropriate public policy question is not should we or should we not promote mining in the developing countries, but rather where should we encourage it and how can we ensure that it contributes as much as possible to economic development and poverty alleviation.     

Sources of funds for developing country petroleum development

The Third World debt crisis has drastically altered the options open to Third World countries to fund petroleum development. Restricted access to international capital markets means that developing countries are having to reconsider alternative financial options to achieve a satisfactory rate of petroleum development. Of these, only foreign direct investmentis capable of compensating for the loss of more traditional sources of funds. To this end, developing countries are revising and harmonizing prior restrictive direct investment rules and tax codes, with recent financial innovations further underwriting the process.     

Dynamics of state mining enterprises during the 1980s and the outlook for the 1990s

This paper examines the evolution of the control by the state of mining and smelting from 1975 to 1989. In 1950, there was little state-owned mining capacity outside the centrally planned economies. A wave of nationalizations of mine assets swept over the developing countries in the late 1960s and early 1970s. State control continued to rise, in developing countries as well as in the developed market economy countries, until the mid-1980s, when the trend reversed. At present some 20% of Western world mineral production is state controlled. The level of control is highest for those minerals mined mainly in the developing countries, and lowest for those minerals mined mainly in the developed market economy countries. The current trend is toward privatization of state-owned mining enterprises in developed countries and it is expected that as the 1990s progress, privatization of such enterprises will also begin to take place in developing countries.     

意大利石油天然气工业及环境保护

论述了意大利及其他欧盟国家的石油天然气防大学工业及环境保护的基本概况,对我国石油企业环保工作提出了建议。意大利及其他欧盟国家社会和经济平衡发展,自然资源利用与保护并重。自然保护区的环境保护法律法规健全,健康、安全、环保已成为政府、公民和企业的共同理念和行动。我国的石油企业应学习意大利等国的经验和做法,在进行工程建设和生产时,应将开发利用经济资源和保护自然资源并重的理念贯穿始终。遵守法律,在工作实际中加强对自然环境的保护。     

PETROLEUM EXPLORATION IN DEVELOPING COUNTRIES AND CONSIDERATIONS ABOUT ITS FINANCING

Although the rate of petroleum produced per foot drilled is much greater in the developing regions of the world, levels of petroleum exploration activities in the these areas are much lower than in the United States. Although exploration levels in the developing countries might have been expected to rise after the 1973/74 price increase, they actually tended to decrease. Classification of the developing countries in terms of the levels of exploration and development they have attained reveals that the greater part of the area with good petroleum potential (57 per cent of non-OPEC countries) is comprised of countries where significant exploration has already taken place. There is a need for international assistance to increase exploration levels in the developing countries. A schedule of priorities for various forms of international assistance is suggested.     

Practical and ethical considerations of agricultural research assistance for the Third World

The right to eat and to an adequate standard of living for everyone motivates agricultural research assistance to developing countries with the primary objective of assuring sufficient food supply. This article focuses on aspects of food production and related agricultural research with specific examples from animal production. It discusses ethics of agricultural research in light of the utilitarian theory and compares livestock production in developing and developed countries. Major reasons for low outputs of animal production in developing countries are identified, and the potential for increasing the productivity of original, extensive production systems is evaluated. The article reviews the current status of biotechnology in developing countries and discusses several advanced animal technologies. The conclusions emphasize the need to involve local professionals in all phases of research and technology transfer in developing countries, avoidance of research that may worsen the situation of the recipients, sustainability of production systems, and the need for detailed assessment of potential impacts of technology on recipients.     

Harnessing the bonanza: economic liberalization and capacity building in the mineral sector

Over the past decade many developing and transition economies have liberalized their investment regimes for mining and privatized formerly state-owned mineral assets. In response, these economies have witnessed increased foreign investment in exploration and development, growth in the number and diversity of mineral projects, and the opening up of new channels for harnessing increased economic and social benefits from development in the minerals sector. The restructuring of fiscal and regulatory regimes to encourage foreign investment, and the associated influx of mining capital, technology and skills, is transforming traditional relationships between mining firms, local communities and the government. This transformation necessitates a re-evaluation of the most effective policy approaches to capture increased economic and social benefits from mineral production. This article considers effective mechanisms for improving the capacity of developing and transition countries to maximize the economic and social benefits of mineral production. Common challenges associated with minerals economies are reviewed. Consideration is given to the opportunities for harnessing foreign direct investment and the possibilities for creating new partnerships between local communities, industry, government, and multilateral development agencies through social investment projects. The article concludes with a series of recommendations for the design and implementation of policy approaches towards harnessing mineral production for economic and social benefit following the liberalization of investment regimes for mining.     

United Nations mineral exploration activities in developing countries

The purpose of the United Nations' mineral exploration activities is to assist the developing countries in identifying, evaluating and developing their mineral resources as a means of stimulating their economic development. Since 1978, these programmes have been executed by the Natural Resources and Energy Division of the Department of Technical Co-operation for Development (DTCD) with the United Nations Development Programme (UNDP) providing the bulk of the financing. In the past 30 years, more than 450 projects in some 100 developing countries have been executed at a cost estimated at US$600 million. This input has contributed to the discovery of deposits valued at billions of dollars, many of which are now being mined.     

UN Department of Technical Co-operation for Development regional seminar activities in 1989

The purpose of the United Nations' mineral exploration activities is to assist developing countries in identifying, evaluating and developing their mineral resources as a means of stimulating their economic development. Since 1978, these programmes have been executed by the Natural Resources and Energy Division of the Department of Technical Co-operation for Development (DTCD) with the United Nations Development Programme (UNDP) providing the bulk of the financing. In the past 30 years, more than 450 projects in some 100 developing countries have been executed at a cost estimated at US$600 million. This input has contributed to the discovery of deposits valued at billions of dollars, many of which are now being mined.     

Evolution and Reform: The Art of Transition in Energy Pricing Policy

This paper presents an analysis of potential methods of reform of petroleum pricing policies in developing countries. It takes as given the highly political nature of petroleum pricing in selected developing countries (including Brazil. Ecuador, Argentina, the Sudan and Republic of Korea), and identifies several models for reform.     

The geographic concentration of world mineral supplies

Mineral reserves are unevenly and erratically distributed throughout the world; those countries which were intensively explored in the past — the USA, Canada, the USSR, Australia, South Africa, and a limited number of Asian, African, and Latin American countries — control a large share of many of the industrially important metallic minerals. Current attitudes towards exploration and the mining industry in both the developed and the less developed countries should clearly encourage rather than discourage new exploration. Given an increase in exploration, new reserves may well be found in previously unexplored areas, but any major increase in world mineral supplies will probably come from mining very low- grade deposits and developing new methods of mining and processing non-conventional ores. While it is vital to increase research and development in exploration techniques and mining and processing technology, it is also critical to maintain current levels of consumption and trade by reversing the trend towards trade restriction on the part of some of the less developed countries who are important mineral exporters.     

Environmental issues for developing countries arising from liberalized trade in the mining industry

This review analyses some of the environmental and economic implications of current trade policies and changes in the world trading system for mineral producers and consumers. A principal factor which determines environmental performance is whether firms have the resources and capabilities to undertake innovation. We therefore place particular emphasis on the anticipated effects of liberalized trade on innovation and competitiveness at the firm level. Evidence indicates that improvements in environmental management would be expected to occur irrespective of the country hosting the investment. Due to the opening investment climate and relatively large quantities of mineral reserves, we expect these effects to be positive for many mineral producing developing countries. One difficulty which may arise is whether policy measures to promote production efficiency and develop innovation in mining and mineral processing operations could be interpreted as protectionism. The creation of new lines of credit, to promote, but not subsidize, technological and organizational innovation, may be the best way forward for developing countries .     

Informality in mineral resource management in Asia: Raising questions relating to community economies and sustainable development

Informal mining activities provide livelihoods for millions of poor in mineral‐rich developing countries. Yet, they continue to remain one of the least understood areas in mineral resource management. While its poverty reduction potential is acknowledged, the heterogeneous forms of mining that come under its purview are not well discussed. This article aims to draw attention to the politics of definition by briefly introducing the reader to the nomenclature currently used to describe such mining activities. Then the article examines the nature of informality that justifies the name, and then illustrates the claim by documenting a range of informal mining practices in India with cited examples from other Asian countries. It illustrates the variations in social‐economic, technical and legal characteristics, by putting such mining in a community and participatory framework. Finally, the article discusses ways to move towards sustainable development with community participation in mineral‐rich areas of developing countries.