mpd toolkit

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TOOLKIT GUIDEMODULE ONEIntroduction 07MODULE TWOUsing the toolkit13Mining and the host country 19Annex 1: Example of a country profile (Guinea)21MODULE THREEThe participating mining operation and its economic andMODULE FOURsocial initiatives and partners27Annex 2: Six priority partnership themes for socio-economic programs 33Measuring the mining industrys contribution to the host country47MODULE FIVEThe proximate aspects of governance that help or hinder miningseconomic and social performance 57Annex 3: Calculating and reporting tax payments 69MODULE SIXMeasuring the participating mines positive and negativecontributions to local communities75Annex 4: Guidelines for field interviews99Annex 5: Notes on calculating employment impacts 103MODULE SEVENAnalyzing the life cycle impact of the participating mine on thehost countrys macroeconomic aggregates111Annex 6: Template for collecting life cycle data 121MODULE EIGHTImpact of mining on governance 125Annex 7: Detailed questions to help assess the impactof mining on governance135TOOLKIT ADDENDUMCommunicating your findings143TOOLKIT REFERENCESAnnex 8: Workshop design tool to present the country case study ormining issues paper149Guiding principles regarding minerals taxation 157Acronyms and glossary167Referenced sources 173How was the toolkit developed? 177The steering group 178This toolkit has been developedby the International Council onMining and Metals (ICMM). It isthe third version of a toolkitoriginally published as theResource Endowment Toolkitin April 2006 in collaborationwith UNCTAD and the WorldBank Group. 3. TOOLKITToolkit CDThere are a number of worksheet and databasetemplates to help you complete each of the modulesin the toolkit. Wherever you see this symbol there isa template available to help you complete the activitydescribed. All the templates are available on theICMM website at MINING: PARTNERSHIPS FOR DEVELOPMENTCD versions of the toolkit are available on request email us at 4. THE TOOLKIT FOCUSES ON SIX THEMATIC AREAS WHERE PREVIOUS WORK HAS INDICATED THE POTENTIAL FOR PARTNERSHIPS BETWEEN COMPANIES AND OTHER STAKEHOLDERS TO ENHANCE THE POSITIVE CONTRIBUTION AND MINIMIZE NEGATIVE IMPACTS: 1. MINING AND POVERTYREDUCTION 2. MINING AND ECONOMICDEVELOPMENT: REVENUEMANAGEMENT 3. MINING AND ECONOMICDEVELOPMENT: REGIONALDEVELOPMENT PLANNING 4. MINING AND ECONOMICDEVELOPMENT: LOCAL CONTENT 5. MINING AND SOCIAL INVESTMENT 6. MINING AND DISPUTESRESOLUTION. Image courtesy of Anglo American 5. GUIDETOOLKITIntroductionUsing the toolkit 6. I WOULD LIKE TO COMMEND THE INITIATIVE THAT LED TO THIS SEMINAL STUDY WHICH DEMONSTRATES THAT NATURAL RESOURCE ENDOWMENT, ECONOMIC DEVELOPMENT AND SOCIAL ADVANCEMENT CAN AND SHOULD BE COMPLEMENTARY CONCEPTS.** Glodomiro Sanchez Mejia, Ex-Minister of Energy and Mines, PeruImage courtesy of Xstrata 7. Introduction The Mining: Partnerships for Development The toolkit provides a common analytical Toolkit provides useful methodology forframework that helps to ensure that evaluating the positive and negative comparisons can be made of minings economic and social effects of mining at contributions and impacts across different the local, regional and national levels in countries. It has been tested in five countries mining countries. These methods will besince 2005 Chile, Ghana, Peru, Tanzania of relevance in particular to the increasing and the Lao PDR. ICMM is actively seeking numbers of lower and middle income more countries to participate in future economies that have high levels of mineral applications of the toolkit so that the dependence.evidence base can be further extended. It can be used by mining companies, mine managers and any other organizations and agencies that have an interest in the relationship between mining and social and economic development outcomes.GUIDETOOLKIT These will include host-country governments, development agencies and development- oriented non-governmental organizations (NGOs). Experience has shown that applications of the toolkit are more effective if organized in partnership with both mining companies and other stakeholders. The application of the toolkit allows users to develop an improved understanding of what issues, policies and practices may be helping or preventing host communities, regions or the country from benefiting more fully from mining. However, its use does represent a significant commitment of time and resources, and users are advised to tailor their expectations of the likely benefits to the level of resources that they are able 07 to commit.Mining: Partnerships for Development TOOLKIT 8. IntroductioncontinuedAbout Mining: Partnerships for DevelopmentICMMs Mining: Partnerships for Development initiative focuses on enhancing miningseconomic and social contribution. It supports the formal commitment made by ICMMmember companies to actively support or help foster multi-stakeholder development-focused partnerships in countries where they are active.Mining is economically critical for millions of the worlds poorest people with some50 countries being significantly dependent on mining. Yet mineral wealth does notalways mean positive economic growth the so-called resource curse theory.In 2004, ICMM began the Resource Endowment initiative in collaboration with UNCTADand the World Bank Group. It developed a substantial body of research on why somecountries have avoided the resource curse and developed practical recommendationsfor companies, governments and civil society. It was overseen by an independentinternational advisory group including the Head of the UN Global Compact and a formerPrime Minister of Senegal.The Resource Endowment initiative showed that the resource curse is not inevitable.Mining investments can drive economic growth and reduce poverty nationally and locally.However, companies alone cannot unlock the development benefits from mining governance is key and multi-stakeholder partnerships can help fill capacity gaps.The findings were based on the application of ICMMs Resource Endowment Toolkit(April 2006) in four countries Chile, Ghana, Peru and Tanzania. The toolkit has beenTOOLKIT GUIDEnow been revised, extended and re-published as the Mining: Partnerships forDevelopment Toolkit.The new version of the toolkit responds to a clear need in different parts of the world fora more systematic and objective way to quantify and agree ways to enhance miningseconomic and social contribution. It is currently being applied in a number of countriesand can be used by mine managers and those interested in promoting economic andsocial development (host governments, development agencies and development-focusedNGOs).08For more information on how to participate in this work, visit oremail us at Mining: Partnerships for Development TOOLKIT 9. Introduction continuedGuidelines for toolkit users The toolkit comprises a series of eight modules and an addendum on taxation.The toolkit is designed to be used on aIt has been designed to be simple withoutcollaborative basis with a range of keyplacing an excessive demand on time orstakeholders. Experience has shown that thecost, and, as far as possible, to beinsights gained and the potential subsequent implemented with in-country resources.development of new partnership ideas are Some of the more technically complexenhanced by a broad engagement with themethods of identifying impact (such aswork by other parties and especially local-level cost-benefit analysis) aregovernments, local communities, developmenttherefore not included.1agencies and some specialized NGOs. You will need to decide which modules toThe early applications of the toolkit have implement as part of the design process forbeen led by mining companies. However, the your project (see Figure 1 ). The moduleslead can be taken by a party other than acan be implemented individually or inmining company. In such cases, activecombination but there are advantages inengagement with some of the mine operationsattempting as full an implementation asin the country will be needed in order to gain your available resources allow.access to the mine-specific data that is notin the public domain.Each of the eight modules includes worked examples or explanations of how to gatherThe outcomes from implementing the toolkit the necessary data and analyze and presentwill typically be a country case study and the findings. Most modules also includeone or more workshops to communicate annexes that provide specific details orthe findings of the country case study.further elaboration on some part of the TOOLKIT GUIDEDepending on your needs, you may not findprocess (e.g. guidelines for field interviews,it necessary to develop an entire countryhow to measure employment impacts orcase to organize a workshop).09 1 For further guidance, see a Guide to Cost-Benefit Analysis of Major Projects, available at, and the DAC Guidelines and Reference Series on Applying Strategic Environmental Assessment, available at Mining: Partnerships for Development TOOLKIT 10. MODULE ONE:Figure 1: The eight modules of the toolkit Mining and the host country Preparing an overview of the countrys geography, population, settlement, land use, economy and recent history with an emphasis on characteristics that influence or are MODULE TWO: influenced by the economic and social impact of mining: economic performance, political stability, quality of governance, dependence on mining, and poverty and human development. The participating mining operation and its economic and social initiatives and partners Developing a profile of the participating mining operation(s) and the local communities in MODULE THREE: which they operate. This should include a profiling of any partnerships already set up by the mining operation(s) for economic