1. Mineral policy: definitions and rationale
What is a mineral policy?
A country’s mineral policy describes the strategic direction it intends to take to develop its mineral resources. It acts as the basis for the formulation of legislation. In the extractives sector, legislation is usually implemented through regulations. From time to time it may also be necessary for governments to issue directives or standard operating procedures to clarify or make minor amendments to regulations.
Components of a typical policy and legal framework in the extractives sector:
Is a policy the same as a vision, mission or strategy?
Sometimes there is confusion between terms mission, vision, strategy and policy. An organisation’s mission should be a statement about why it exists. Its vision should describe what it wants to achieve and what values it intends to follow to get there. Strategy is a coherent set of actions that is intended to result in an organisation’s mission and vision being realised. One element of such a strategy may be the development of a policy and legal framework as described above.
The journey from mission and vision to strategy:
Why have a mineral policy?
The process of putting together a mineral policy is an opportunity to build consensus on how mineral development will take place. Ideally, policy should reflect a broad-base of societal views. Some governments underestimate the importance of taking sufficient time to develop a mineral policy. They may avoid stakeholder consultation because they believe the issues are too complex for stakeholders to understand or because they do not want to risk being caught up in difficult debates about the future of the industry.
In these cases, there is a risk that legal drafting teams may end up trying to define a country’s vision and strategy, making the process of developing a legal framework more contentious and time-consuming than it needs to be.
The context for policy development in the 21st century: Mining and sustainable development
Mineral policies that have been developed over the last decade typically incorporate principles of sustainable development. The concept of sustainable development has been around for much longer but it has taken some time for a non-renewable resource such as minerals to be considered in terms of sustainable development.
When developed responsibly, wealth derived from mineral resources can be used for many positive purposes. In addition to contributing to the national treasury through taxation, there are many spin-off benefits from mining. For example, suppliers can be contracted to provide goods and services to mines, communities can benefit from increased employment opportunities and local government’s development agenda can be implemented through a mining company’s contribution to social infrastructure.
However, there can be negative impacts from mining too, which a good mineral policy needs to consider. Issues relating to the potential negative impact of mining on the environment, for example, should be considered throughout the mine lifecycle and with a view to assessing impacts through the product lifecycle.
The Mining, Minerals, Metals and Sustainable Development’s Mining Policy Framework of the Intergovernmental Forum characterises the mining process as the transfer of mineral resources from one inventory (nature) to another (society) and acknowledges that this transfer between inventories is only the first essential step in the life cycle of materials.