Forget Apple (NASDAQ:AAPL) or Tesla Motors (NASDAQ:TSLA) and their race to introduce the self-drive automobile to our streets. The mining sector is already well ahead in that department, although a new report may sap some of the political support for it.
Most participants in the mining industry will agree that more efficiency and fewer accidents caused by human error have been the benefits of the wide deployment of automation in mining during the past five years.
But local communities and governments are set to lose jobs and tax revenues because of these emerging technologies, a new report International Institute for Sustainable Development is due to reveal on Thursday in Geneva.
According to a study, countries where miners are rapidly adopting new technologies, such as self-driving trucks, will be increasingly at risk of reduced socio-economic benefits from mining in the near- and medium-term.
The report argues that while the concept of “shared value” has become key for mining companies, it should also be a core concept to ensure that resource-rich countries gain the maximum benefit from the extraction of their resources. This, says the document, while ensuring that the private sector has a legitimate opportunity to extract the resources on a for-profit basis.
The report will also say that job losses will hit sooner and in greater numbers in developed countries where labour costs are higher and where mining companies typically purchase a larger percentage of their goods and services locally.
That said, the social and economic impacts could be much more significant in developing countries.
The “Mining a Mirage” report, to be presented at the Annual General Meeting of the Intergovernmental Forum on Mining, Minerals, Metals and Sustainable Development in Geneva, analyses procurement data supplied by two mining companies with annual expenditures exceeding $600mln and is doubtless going to stir considerable debate.
Story by ProactiveInvestors