Factoring in governance is not enough. Mining codes in Africa, policy reform and corporate responsibility

Abstract

One of the main hypotheses underlying much of the discussion and certain of the recommendations made by the World Bank Group's Extractive Industries Review suggests that the quality of governance of a country is a key determinant for the development outcomes of extractive industries activities. While undoubtedly of central importance, a recent comparative study of mining codes in Africa suggests that while the quality of national governance is undoubtedly a key ingredient, no amount of local governance is sufficient if not accompanied by legal and fiscal frameworks designed to meet development objectives and which are implemented in the context of good international policies and rules. Based on this study, the article suggests that the reform measures introduced largely at the recommendation of multilateral financial institutions over the last twenty years have entailed a redefinition of the role of the state that is so profound that it has no historical precedent and that this situation has not received the attention which it deserves. The comparative study of what are identified as three generations of African mining codes concludes that past reforms have the potential effect of driving down standards in areas of critical importance for social and economic development, as well as in protection of the environment in the countries concerned.