"There can be no doubt that mining, executed responsibly, is a significant force for sustainable growth. Beyond the multiplier effects on employment, livelihoods and the national economy, it should not be underestimated that whole communities are directly and often exclusively dependent on the sustainability and growth of the mining sector.
But to succeed in growing the mining economy, long-term relationships of trust and mutual respect must be established between its key stakeholders.
A mining operation should provide socio-economic benefits to all stakeholders – including employees and local communities (in the form of jobs, local procurement and community projects), national and regional governments (in the form of royalties, taxes and investment) and investors of capital (in the form of dividends, interest and risk adjusted returns on their investment). If one group withdraws their support for the operation, this will negatively impact all stakeholders.
For much of the last decade, the debate about mining’s contribution to development has been stunted by the dead hand of the ‘resource curse’ theory, which held that many poorer countries would be better off leaving their minerals in the ground.
This is partially because many developing countries with a natural resource endowment are faced with a legacy of poverty and inequality to which the mining industry has, without doubt, contributed.
To address these challenges, it is essential to maximise the socio-economic benefits from the extraction of natural resources, but to do so without shrinking the mining economy. There are numerous examples around the world where mines have been a catalyst for wider socio- development.
Gold mining typically accounts for a high proportion of foreign direct investment for developing countries and for a substantial chunk of foreign exchange earnings. A recent report [The direct economic impact of gold, PWC, October 2013] found that gold mining contributed some $78 billion in gross economic value added and 530,000 direct jobs in the 15 leading gold producer countries. Moreover, mining tends to generate large numbers of indirect jobs and to have significant multiplier effects in part because many mining jobs pay well and are highly skilled''.
By Nick Holland CEO Gold Fields
