.........in Africa, Asia with more transparency
Rowan Callick |
THE government of Afghanistan has developed a plan to replace aid — which today supplies 61 per of its budget — by its booming resource industry within a decade.
The country’s Mines Minister, Wahidullah Shahrani, yesterday told a Sydney conference on Mining for Development that this was the path through which Afghanistan could shift from being heavily dependent to “standing on our own feet”.
Many other mining ministers from emerging countries are also participating in the AusAID-organised conference, including Myint Aung of Myanmar, Esperanca Bias of Mozambique, Michael Oni of autonomous Bougainville and those from Ethiopia, Madagascar, Solomon Islands and Uganda.
Graeme Hancock, the president of Anglo American in Mongolia, who has also worked for the World Bank and for 16 years in Papua New Guinea including as national mines director, said that to bring about the best results from mining, “prescriptive legislation is ultimately doomed to failure”.
The best outcomes, he said, came from creating a process that involved the whole community in developing resources. This was even more important, he said, than achieving “outcomes”.
Transparency was also a process, Hancock said. “It is not an event” — which cannot be contained by a meeting that lasts a day or two.
He said that responsible companies wanted well-drafted, and implemented, legislation and regulations, because “they don’t want to be dragged into the mire because other miners are allowed to create a mess. That destroys the licence to operate for us all.”
He said that in the developing world, miners might be expected to take on roles well beyond their core business — such as setting up schools or clinics — raising the question: “Where does this end, and tax begin?”
But the companies often had logistics capabilities “far exceeding a government’s capacity to deliver”, he said — and could thereby help create a conducive environment to operate in.
He gave the example of how Placer Pacific helped the PNG government wipe out debilitating elephantiasis disease on Misima island, where the company was then running a goldmine.
Peter Baxter, director-general of AusAID, said that “by far the biggest contributor to (the massive recent global) reduction in poverty has been economic reform that allows the private sector to flourish and growth to occur”.
Over the past decade, he said, developing countries’ share of world trade in minerals had risen from less than a third to almost half. In 2009, African natural resource exports were worth $246 billion, six times more than total aid. And 230 Australian mining companies were now operating in Africa, he said. “We are a world leader in mining and we want to use our aid program to share our experiences, knowledge and skills with others.”
Andrew Leigh, parliamentary secretary to the Prime Minister, said the “resource curse” had meant some countries with more resources had lower growth rates and weak democracies, with “mineral endowments being easier for non-democratic leaders to expropriate than income from other sources”. He said such a curse could be turned into “a new resource blessing” through measures to defeat corruption and promote transparency.