Anglo American Defends Zimbabwe Operations

In a June 25, 2008 post to the blog International Mining, John Chadwick writes about the effect of recent political instability on Anglo American's platinum project in Zimbabwe. In the wake of Mugabe's controversial return to power, Anglo American's Zimbabwean operations are in the spotlight. The company's decision to continue production at the Unki platinum mine has launched a debate about the responsibilities of foreign firms in times of political instability.

While some argue that Anglo American's choice to stay in Zimbabwe equates to complicity with a repressive regime, others hold that a pullout would be an economic insult to an already injured populace. In response to critics, Anglo American argues that if it abandons the project, Mugabe's government will assume control. Anglo American also cites its continued support of social development initiatives in the communities around the project, including an irrigation project to promote agriculture, and support to schools and community health programs.

The controversy surrounding Anglo American shows that there is a rising demand for accountability on human rights issues in business as well as government. However, public disagreement on the appropriate course of action for Anglo American shows that many important questions about corporate social responsibility remain unanswered.

Is oil wealth in the Middle East a barrier to female empowerment?

In the February 2008 issue of American Political Science Review, UCLA political science professor Michael L. Ross argues that oil wealth reinforces gender inequality in the Middle East. In his article entitled "Oil, Islam, and Women," Professor Ross holds that resource wealth, not Islamic tradition, is the primary explanation for lagging female empowerment in the region. To support this claim, Ross draws on global data on oil production, female workforce participation, and political representation of women, and compares oil-rich Algeria with oil-poor Morocco and Tunisia.

Ross's study offers a fascinating look at the complex social and economic repercussions of resource wealth in the developing world. His work's minimization of Islam's role in the region's gender inequality offers an interesting perspective on the East-West cultural divide and raises important ethical questions about the world's growing fossil fuel dependency.

Does the industrialized world's reliance on oil promote gender inequality?
If so, what responsibility have consumers and companies to promote female empowerment in source countries?
What interventions would best serve the goal of promoting gender equality in these contexts?

The EITI in "Petro-states"

The Resource Investor, a web news service for investors in the mining, drilling, and piping sectors, recently published an article by Susan A. Aaronson on the effects of the EITI (Extractive Industries Transparency Initiative) in resource-rich developing countries. The article, entitled "Can Transparency in the Extractive Industries Break the Resource Curse?," compares data on business regulation and government accountability in EITI implementing and non-EITI participating countries over the four years since the agreement's founding in 2004. Her analysis suggests that the EITI has positively affected transparency indicators.

Aaronson makes the case that these indicators are important precursors to the extension of extractive revenues beyond government elites to local populations, a historical challenge for many resource-rich countries. She holds that the EITI may have ripple affects in non-extractive sectors, and that this could greatly amplify the power of the initiative to solve long-standing economic development problems.

Aaronson argues the benefits of the EITI convincingly, but an important concern about sampling bias remains. The EITI is a voluntary program. EITI-participating nations may be different from their non-signatory peers in important ways. Participatory countries choose to join the EITI for one reason or another. One could be a spontaneous increase in representative democracy. Another could be external pressure from a mining corporation. Either of these forces would predispose a government to increase transparency.

Is the true cause the EITI, or is it the pre-existing conditions that prompt a country to adopt the EITI? We look forward to hearing your thoughts on this and other aspects of Aaronson's discussion of this important sustainability issue.