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Building sound mining governance: Australian economic diplomacy in action IMARC Mining Summit Ian Satchwell 24 September 2014
Transcript of Building sound mining governance: Australian economic ... · Building sound mining governance:...
Building sound mining
governance: Australian
economic diplomacy in action
IMARC Mining Summit
Ian Satchwell
24 September 2014
• Minerals and energy – the potential to unlock economies
• New country growth model based on sound governance
• New company approach based on partnership and shared value
• Why it is in Australia’s interests to help
• Australia’s new economic diplomacy strategy and aid for trade
• Energy, minerals and development and IM4DC
Summary
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81 countries are driven by resources — up from 58 in 1995
Minerals and energy development: unmet potential THE CHALLENGE
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80% of resource-driven countries have per capita
income levels below the global average; more than ½ of these are not catching up
BUT 69% of people in extreme
poverty are in resource-driven countries
90% of resources investment has been in middle- and high -
income countries
Sources: McKinsey Global Institute, Reverse the curse: Maximizing the potential of
resource-driven economies, December 2013, and others
Global resources revenues ~$3.5 trillion = 5% global GDP
~½ of the world’s known mineral and oil and gas reserves are in developing
countries – investment needs to increase at >2X historic rates
Minerals and energy development: unmet potential …AND THE OPPORTUNITY FOR SHARED VALUE
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540 million people in resource-driven countries could be
lifted out of poverty, triggering economic and social transformation
$11-$17 trillion of resources investment could be
needed by 2030—more than double the historical investment rate
Opportunities to share $2 trillion of investment in
resource infrastructure
Source: McKinsey Global Institute, Reverse the curse: Maximizing the potential of
resource-driven economies, December 2013
50%+ improvement in resource-sector competitiveness
possible through cooperative action
• Building institutions and governance of the resources sector
• Developing infrastructure
• Ensuring robust fiscal policy and competitiveness
• Supporting local content
• Spending resources windfall wisely
• Transforming resource wealth into broader economic development.
Skills and institutional capacity are the key.
Resource-driven countries need a new growth model TO TRANSFORM THEIR POTENTIAL RESOURCE WINDFALL INTO LONG-TERM PROSPERITY
5 Source: McKinsey Global Institute, Reverse the curse: Maximizing the potential of
resource-driven economies, December 2013 and IM4DC
Resources companies need a new approach to the changing landscape PARTNERSHIPS WITH GOVERNMENTS & COMMUNITIES IN ECONOMIC & SOCIAL
DEVELOPMENT TO BUILD SHARED VALUE
6 Source: McKinsey Global Institute, Reverse the curse: Maximizing the potential of
resource-driven economies, December 2013
International Mining for Development Centre
• Mining is a fast & sustainable pathway to economic growth and poverty reduction
• but many developing countries lack capacity to achieve this
• Australia’s leading practice in mining technologies, services and education, governance and in doing well from mining
• Well-respected mining nation and partner: a leading brand globally
• Major offshore investor and METS trading partner
• The X-factors: little geopolitical baggage; ability to work at frontiers
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Why is it in Australia’s interests to help build mining governance and skills? OR “WHY SHOULD WE ASSIST THE COMPETITION?”
Africa
North & Central
Asia
Latin America
Europe
Australia
North America
SE Asia & Pacific 5b
206
75
94
53
Number of ASX-listed mining companies operating in region (Source: SNL Mining and Metals)
66
105
Generating value globally: Australia’s mining-related
investment and trade interests
662
Africa
North & Central
Asia
Latin America
Europe
Australia
North America
SE Asia & Pacific 5b
206
75
94
53
Percentage of Australian-based METS companies identifying region as a key market (Source: Austmine)
Number of ASX-listed mining companies operating in region (Source: SNL Mining and Metals)
66
105
34%
62%
38%
27%
27%
23%
Generating value globally: Australia’s mining-related
investment and trade interests
662
Africa
North & Central
Asia
Latin America
Europe
Australia
North America
SE Asia & Pacific 5b
206
75
94
53
Percentage of Australian-based METS companies identifying region as a key market (Source: Austmine)
Number of ASX-listed mining companies operating in region (Source: SNL Mining and Metals)
66
105
$25bn
34%
62%
38%
27%
27%
23%
Generating value globally: Australia’s mining-related
investment and trade interests
662
$410bn
$218bn
$296bn
$461bn
$556bn
$687bn
Value as at August 2014 of ‘maiden resources’ announced by ASX-listed companies 2008-2013 by region
(Source: SNL Mining and Metals)
Mineral and coal discovery and delineation by Australian listed companies 2008-2013 POTENTIAL SHARED VALUE FOR HOST COUNTRIES, COMMUNITIES AND INVESTORS
11 Maiden resources discovered and delineated by ASX companies 2008-2013 valued at August 2014 prices
How to turn potential to actual shared value?
Value of Australian company discoveries in developing countries $1,470bn
Value of discoveries by companies from other countries $???
Economic diplomacy: open economy, private sector growth, investment, trade and economic growth
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GOAL IS TO DELIVER GREATER PROSPERITY FOR AUSTRALIA, THE REGION & GLOBALLY
Min
era
ls E
nerg
y
& D
eve
lop
me
nt
MINERALS, ENERGY & DEVELOPMENT
WORKS ACROSS ALL PILLARS
Australian aid: promoting prosperity, increasing stability, reducing poverty ECONOMIC GROWTH IS NOW AT THE HEART OF AUSTRALIA’S AID POLICY
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IM4DC activity
Minerals, energy and
development:
economic diplomacy and
aid for trade in action
International Mining for Development Centre
Role of IM4DC
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UNIVERSITY PARTNERSHIP SUPPORTED BY AUSTRALIAN GOVERNMENT
Mission
Support developing countries to transform their
extractive resource endowment into inclusive and
sustainable economic growth and social development
Goal
IM4DC alumni and partner institutions effect change
through transformational leadership in mining,
development and related activities
Themes
Governance and
Regulation
Community and
Environmental
Sustainability
Operational Effectiveness
Agent for sustainable mining underpinned by good governance
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INTEGRATED PROGRAM OF CAPACITY-BUILDING
International Mining for Development Centre
Activities
Institutional linkages
Education and training
Fellowships
Alumni network and conference
Advice to governments
Publications
Action research
● Geodata
● Minerals and energy policy
● Mineral economics
● Resource governance
● Negotiations and agreements
● Indigenous agreement-making
● Community engagement
● Local content
● Regional development
● Infrastructure planning and delivery
● Revenue design
● Mine waste management
● Mine closure and post mining land use
● Environmental and water management
● Occupational health and safety
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Leveraging Australia’s mining and development expertise IM4DC CAPACITY-BUILDING
Activities cover the mining life cycle and all elements of mining for development
IM4DC Achievements SUCCESSFUL TRAINING OUTCOMES
October 2011 to February 2014
IM4DC Achievements GLOBAL CAPACITY-BUILDING OUTPUTS TO END AUGUST
2014
2009 participants from 50+
developing countries
11652 74 participant short courses
training days
30% 1362 50 female active in mining alumni research
participation network projects
SE Asia & Pacific 5b
Number of IM4DC course participants
Where IM4DC is working
Africa
937
343
186
523
Multi year engagement with governments and institutions
Indonesia
Ghana
Peru Zambia
The Philippines
Participation in courses, study tours, research
West Africa
Colombia
Uruguay
Ecuador
Southern Africa
East Africa
Bolivia
Mongolia
Latin America
Mozambique
African countries serviced by IM4DC include: Congo, Mali, Morocco, Niger, Nigeria, Burkina Faso,
Ethiopia, Guinea, Cote d’Ivoire, Gabon, Uganda, South Africa, Kenya, Malawi, Cameroon, Tanzania,
Sierra Leone, Senegal, Namibia, Madagascar, Cameroon, Ghana, South Sudan, Zimbabwe
Tanzania
Fiji
Papua New Guinea
Solomon Islands
Myanmar
Some IM4DC Alumni stories
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Peter Bangura
Sierra Leone Oyuntsetseg Oidov
Mongolia
Abena Asante-Asare
Ghana
Ibrahim
Hardjawidjaksana
Indonesia
International Mining for
Development Centre
The University of Western
Australia
WA Trustees Building
Level 2, 133 St Georges Terrace
Perth WA
Australia 6000
Tel: +61 8 9263 9811
Email: [email protected]
www.im4dc.org
Contact
The Energy and
Minerals Institute
The University of Western
Australia
M475, 35 Stirling Highway
Crawley WA
Australia 6009
Tel: +61 8 6488 4608
Email: [email protected]
www.emi.uwa.edu.au
The Sustainable
Minerals Institute
The University of Queensland
St Lucia
Brisbane QLD
Australia 4072
Tel: +61 7 3346 4003
Email: [email protected]
www.smi.uq.edu.au
