Sharing Mining Benefits in Developing Countries - World Bank

the local development spectrum, just as the existing players on thedevelopment scene will influence the activities and priorities of the FTF.The emergence of an FTF focusing on development activities related toa mining project can generate a range of responses. Ideally, developmentactors, including government authorities, will seek to work together, andnew FTFs will be integrated into the local development setting. However,the emergence of a new FTF can also be seen as a reason for other developmentactors to reduce their existing support for a mining region and tofocus their activities on areas that have no other sources of funding.Integration with an existing development plan for an area may bevoluntary, but growing numbers of governments are requiring it.An integrated development plan: The Rio Tinto Palabora MiningCompany, Ltd., South AfricaMining has been a major component of the South African economy formore than a century. In 2007, its role was valued at 7.7 percent of GDP,equal to US$18.4 billion (DME 2008). The South African mining industryhas undergone significant modifications since the democratic changesof the 1990s, primarily targeted toward redressing the discriminatorypolicies that existed before 1994. The Mineral and Petroleum ResourcesDevelopment Act (2002) requires that companies convert their “oldorder” rights to “new order” rights. A number of social development activitiesand commitments are required as part of the conversion process.For example, mining companies are required to submit a social and laborplan and to support broad-based socioeconomic empowerment in partnershipwith government.Within this context, the Palabora Foundation has been operating inthe Ba-Phalaborwa communities for 23 years as the social developmentarm of the Rio Tinto Palabora Mining Company, Ltd. (Palabora). Usingan operational approach, the Palabora Foundation has a staffing complementof approximately 100 people and works with communities withina 50 km radius of the town of Phalaborwa (figure 4.6). The Foundationhas defined several strategic objectives, one of which is directly focusedon integration: “to facilitate, in partnership with the Ba-PhalaborwaMunicipality and other stakeholders, the implementation of the IntegratedDevelopment Plan and Social and Labour Plan.” Both of these planshave been developed in coordination with the government; progress isreported annually.The Foundation presents projects for consideration to communityforums that include representation from each of the five tribal authorities.40 Sharing Mining Benefits in Developing Countries