sharing in governance of extractive industries

Is the mining industry vital to the creation of wealth and prosperity?

In the introduction to its 2010 ranking of countries for mining investment, Behre Dolbear Group states: 


"The mining industry is vital to the creation of wealth and prosperity in any country and that countries that stifle it with detrimental political, economic and financial policies should be challenged to make changes more accommodative to its success."


Do you share this view?



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Eng. Ahmed, I think you need to ask first who pays Behre Dolbear group to traverse the globe as they scout for the vultures up north. However, when it comes to questions of leadership, unless you have sat at the alter and devoured ungodly state served cakes as your fellow country men died of hunger, we must join hands in condemning all forms of dictatorships across Africa.


Historically Africa was raped by the hungry angry Europeans. In modern times, it is not the same Europeans raping our continent but fellow hungry angry Africans defiling and raping our homelands.

Exactly, that was part of my question-who pays these guys?

Is it not time for a Call for Transparency in NGOs and CSOs?

What percentage of the funds they raise goes directly to alleviating the plight of the poor of Africa who  are used in their fund raising advertisements that we are bombarded with here in the West?

I share the sentiment that the process of economic growth and development can start from a natural resource based economy but I do not agree with Dolbear's generalisation for two main reasons.

First, the mining industry is vital to the creation of wealth and prosperity in some countries - not ANY country.  Secondly, the statement does not consider that mining can have negative impacts on surrounding communities and host countries.  These 'costs' are often not borne by the mining company and, in the absence of legislation, they would not factor into the company's design decisions.  Some of this 'stifling' legislation tries (although often inadequately) to either internalise or minimise the social costs of mining.  

so Martin do you think some countries should stiffle the growth of mining? and which ones? should Nigeria for example stop producing oil? because of the effect on the local community? or should it find a way of balancing that effect?

As you suggest, countries should balance the positive and negative effects of mining.  I can't think of any countries that should stifle the growth of the mining sector without good reasons or why halting production of Nigeria's oil would be an 'optimal' or first best solution to its problems.... unless you're referring to a very specific case where no production is better than any level of production regardless of any possible mitigating or compensating factors.

@Ahmed: The Behre Dolbear Group are consultants: http://www.dolbear.com/about-us/index.htm

@Bwesigye: The situation in Uganda appears to be particularly unfortunate. If I understand correctly, the political leadership's delay in putting in place the legal framework appears to have created a lose-lose situation: government is not getting the tax it believes it is owed it and investor confidence is shaken. Meanwhile delays mean the jobs are not coming as fast as they could have been and the government and company are losing potential revenue. 

i competly agree.



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