The initiative was launched by Prime Minister, Julia Gillard, in October 2011 and comes as Australian mining companies expand their operations in Africa, Asia and the Pacific.
It’s intended to help developing nations avoid the catastrophic mismanagement, corruption and environmental damage that, in places like Nigeria, has resulted in ordinary people being left worse off as a result of their mineral wealth.
Presenter: Jemima Garrett
Speaker: Thulsi Narayanasamy, Director, Aid-watch; Peter Baxter, Director General, AusAID; Serena Lilywhite, Mining Advocacy Advisory, Oxfam Australia
GARRETT: The developing world’s share of mineral, petroleum and gas exports is growing fast.
It accounts for 50 per cent of the global trade – up from 30 per cent in just 15 years.
That means 3.5 billion people now live in poor countries with a significant extractive industry.
For them the resource curse – the poverty, corruption, conflict and environmental damage that so often comes with resource industries – is a real risk.
The mining for development initiative aims to help developing country governments improve governance and envronmental mangement.
Thulsi Narayanasamy, the Director of Aid-watch organisation is sceptical.
NARAYANASAMY: Aid-watch’s assessment of the Mining for Development initiative is at best an inexpensive exercise in corporate welfare delivering various financial and regulatory support to mining companies, and indirect support through green-washing these companies and rebranding their images as sustainable. There are very few prospects for alleviating poverty and inequality in terms of the image that they’re perpetuating with mining being the solution for developing countries, which there is very little evidence to demonstrate.
GARRETT: Other aid and mining watch dog organisations are keen to find a solution to the resource curse and have an open mind about the Mining for Development Initiative.
Oxfam Australia’s Mining Advocacy Advisory Serena Lilywhite hopes the initiative will succeed.
LILYWHITE: It has the potential to help ensure that citizens of resource rich but very poor countries do get a fair share of their natural resource wealth, and also to help reduce their dependency on aid. So there is great potential. But Oxfam’s view is that in order to maximise the likelihood of that happening one of the components of the initiative, which is called the community and social development pillar, or in other words the part of the initiative that’s really focussed on community engagement. This has really got to be front and centre of the initiative.
GARRETT: The director General of AusAID – the Australian government agency that is responsible for the Mining for Development Intiative is adament he is not a stalking horse for corporate interests.
BAXTER: We’re not doing this to help mining companies, they don’t need our help. What we’re doing is trying to help governments to get the best result they can from their natural resource sector, and Australia is recognised internationally as a global leader in governance on natural resource industries, and it’s only appropriate that we transfer some of the skills and knowledge that we have through the aid program to developing countries.
GARRETT: Why spend Australian aid money on mining when there are other less destructive options that you could be spending money on?
BAXTER: When you say less desctructive options, I’m not sure I agree with that characterisation.
GARRETT: Agriculture for instance?
BAXTER: Well if you look at countries they actually have to earn revenue so that they can improve the level of services that they provide to their populations. In our own region you look at a country like Timor Leste, Timor Leste gets 95 per cent of its export earnings from oil. Papua New Guinea receives about 70 per cent of its total export revenue from natural resources. So you can see from that it’s going to be the extractive industries in many countries that’s going to drive an improvement in living standards if the revenue stream is handled properly. No one doubts the importance of agriculture, no one doubts the importance of other sectors, but in terms of earning revenue that can be turned into better basic service delivery for the population, the natural resource sector will continue to be important for developing countries.
GARRETT: Mr Baxter says AusAid does not partner with mining companies or fund their corporate social responsibility activities. Serena Lilywhite says the non-government sector will be holding him to account.
LILYWHITE: Organisations such as Oxfam will be really keeping a close eye on ensuring that these commitments have been made, and in fact that money does go to NGOs and local organisations that are in a very strong position to ensure that their needs are considered and they’re actively involved in decision-making processes both with their own government, but also with Australian companies that are doing business in the region.
GARRETT: Aid-watch is calling for the cancellation of the Mining for Development Initiative.
NARAYANASAMY: I think the Australian government needs to admit that they’ve made a big mistake and they should be canning the whole idea of wanting to perpetuate the idea of mining as a solution for developing countries with absolutely no evidence for this. I mean if anything AusAid should be aligning themselves with the people that are struggling and resisting mining, these are disadvantaged people struggling to protect their natural resources and agricultural practices that sustain them from destruction by mining, often at very great cost to themselves. And AusAid should be aligning themselves with this group of people, not with mining companies that are perpetuating the problem.
GARRETT: AusAid Director General Peter Baxter rejects Aid-watch’s analysis of the Mining for Development Initiative. He says sustainable mining is possible and the initiative is making a difference.
BAXTER: Already by the end of June this year we’ll have trained around one-thousand-100 people from 30 countries in a whole range of areas related to mining. There is a geological science aspect, there is a revenue management element, there is a community-based development element, there is a sustainable environmental element, so it’s a multi-faceted approach, it’s not just talking about how quickly you can dig the stuff up out of the ground and sell it. It’s looking at the full life cycle of mining and making sure in particular that there’s a focus on delivering real benefits to communities.
GARRETT: Minerals and petroleum are clearly non-renewable resources. Is this talk of sustainable mining a case of green-wash, how can you have sustainable mining for a non-renewable resource?
BAXTER: I think you’re absolutely right in that these are non-renewable resources. So that’s why it’s particularly important that while those resources are being extracted they’re managed properly and the maximum benefit in terms of equitable benefits to the communities involved are actually delivered.