JOHANNESBURG (miningweekly.com) – Politicians are not understanding mining's complete range of benefits well and mining companies are failing to express them well, says International Council on Mining and Metals (ICMM) president Tony Hodge.
Policy makers are also not as au fait as they could be with the costs that mining companies face in their operations – and again companies are failing to express them well, Hodge adds in a videoed Mining Weekly Online interview (see attached).
Moreover, these gaps are opening up at a time when mining’s cost curve has overpassed the price curve.
“So it’s a very tough time for companies,” says Hodge, who adds that he is not out to blame anyone.
The haziness has, however, given rise to demands for more.
But for society to be able to share in mining’s benefits optimally, there have to be well-defined responsibilities and all those responsible for managing costs and risks have to be held accountable.
While the systems of holding companies to account are well developed, there are no systems in place for holding governments to account and for holding communities to account, for the relatively small parts of the equation they need to take responsibility for.
“The systems just haven’t caught up with each other and unfortunately because of the full range of benefits not being fully understood, you get demands for greater amounts of benefits when people don’t realise what they are in the first place,” says the head of ICMM, which brings together 22 of the most prominent mining and metals companies and 35 associations to maximise the contribution of mining, minerals and metals to sustainable development.
The real economic benefit that mining brings for low- and middle-income countries is the foreign direct investment and the generation of earnings in foreign markets, which he ranks above the contribution to government revenues and gross domestic product.
Mining also helps with infrastructure development, which is currently of tremendous concern in Africa.
“When looking long term, we have to start thinking more strategically at all these issues… we have to do it collaboratively. It can’t be government going into a cupboard and deciding what to do and imposing it. It can’t be the industry just going into a cupboard, deciding what’s needed and imposing it on communities. It has to be done together in a way that we can move forward to make a better future,” says Hodge.
ICMM, led by the CEOs of many of the world’s largest mining companies, is a strategic partner of the Committee for Mineral Reserves International Reporting Standards, which promotes best practice in the international public reporting of mineral exploration results, resources and reserves, and works closely with the World Conservation Union on mining and biodiversity, indigenous peoples issues, restoration of legacy sites, protected areas review and landscape level planning.