In our research project, funded by the Australian Department of Foreign Affairs and Trade, we investigate various socio-economic impacts of mining as a powerful international industry in two countries in Mekong area: Laos and Thailand. The impacts of mining industry are multi faceted. Mining activities might be painted as a collective effort of a bunch of rapacious monsters, keen to simply tear up the land, clear cut forest, extract all the minerals from the earth and runaway. That old picture needs to change when we think of developmental aspects of the industry.
Partnership among stakeholders such as local and international Governments, mining multinational corporations (MNCs), community, and educational institutions can improve technical and vocational aspects as well as research delivered in response to mining industry demands. International mining industry can increase employment opportunities for local people and improve local participation in the industry.
Similar to most international industries, benefits from this industry come with some challenges. Stories of gold mining communities in Pichit Thailand and Vilabouly in Laos may sound like a classic story of a typical rural community that is discovered by a gigantic, powerful mining MNCs. Both community face rapid economic changes where employment opportunities, new infrastructure, and new opportunities in life are created by the advent of international mining MNCs.
However, with economic miracle, members of the community also feel 'the air of economic challenges.' The majority of workers of mining MNCs from our study raised a similar concern on uncertain economic future in the community. What can be done to guarantee this constant income in the future, when the end of mining industry approaches the community? In the Laos context, economic miracle from this international industry has long been supporting on-going development in the community. When the land becomes useless for mining industry, community members question their economic future. What should they and mining MNCs do to mitigate this future economic impact in the host counties?
The second challenge we learn from the project is the importance of relationship among mining stakeholders. If we use ‘stakeholder theory’ by Ed Freeman to explain international mining industry, we understand that the conventional idea that business is about maximizing profits for shareholders is outdated. It does not work well in modern economy since the recent global financial crisis has taught us. The 21st Century is one of “Managing for Stakeholders.” The task of mining executives is to create as much value as possible for stakeholders without resorting to trade-offs.
With the serious (and notorious) circumstance in Thailand where the Thai Government commanded a mining MNC to shut down its operation, due to its potential contribution to public health concerns in the community, we learn that the failure to manage different demands from various stakeholders can be one of the key issues contributing to this problem.
Rural community may benefit from various levels of engagement among mining stakeholders that can potentially bring tremendous economic and technical benefits to community members. However, when various stakeholders involve, most mining MNCs may fail to respond to different demands from all stakeholders. That can potentially lead to management failure as one of the challenges in international mining industry.
In summary, benefits of mining industry can prevail over negative impacts if mining MNCs work very closely with and listen to all stakeholders in the host country. If community development is seen as an important element of international mining industry, it is important that mining MNCs must move beyond the point of being an industry where people engage purely for monetary benefits. The industry must speak out loud as an industry for sustainable development.
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