Mining and Development: Lessons Learnt from South Africa and Beyond

Photo: Media Club, Graeme Williams
Photo: Media Club, Graeme Williams

Africa is blessed with an abundance of mineral resources, yet it remains poor by most measures. Recent high growth rates have yet to translate into inclusive development. The continent must harness its mineral wealth to build human capital and industries that allow it to diversify away from commodity concentration.

Commodity-dependent economies are susceptible to price volatility in global markets, which makes long-term planning difficult. Mineral resources are also finite. Diversification through immediately available mineral wealth is critical to long-run wellbeing. However, diversification funded by mineral wealth requires material improvement in the institutions governing mineral extraction. A better understanding of the incentives generated by formal and informal institutions is critical for successful implementation of resource governance initiatives on the continent. Reflections on South Africa’s mining governance and industrial relations frameworks demonstrate how important context-specific understanding is for crafting policies that gain meaningful development recognition.

The views expressed in this publication/article are those of the author/s and do not necessarily reflect the views of the South African Institute of International Affairs (SAIIA).

3 Apr 2014