The economic and social impact of mining-resources exploitation in Zambia

• Published in: Resources policy 2021-12, Vol.74, p.102242, Article 102242
• Main Author: Aguirre Unceta, Rafael
• Format: Article
• Language: English
• Subjects: Development policies; Economic development; Exploitation; Extraction; General economic development; Impact analysis; Mineral resources; Mining; Mining industry; Natural resources; Poverty; Public finances; Public goods; Social impact; Taxation; Transformation
• ISSN: 0301-4207; 1873-7641
• DOI: 10.1016/j.resourpol.2021.102242

Mining resources (mainly copper), whose extraction and export were initiated during colonial times, have played an important role in the economy of Zambia, a landlocked country in central-southern Africa. This country faces serious development challenges, especially regarding economic structural transformation, deficient public goods, and high poverty. The question arises as to what extent the mining natural resource has contributed or not to tackle these challenges. More specifically, how public action has intervened for addressing them. The analysis is based on the A.O. Hirschman's linkages theory and on some of the resource curse assumptions. The general conclusion is that returns from mining resources has been modest in Zambia, even adverse in some respects, and that a hypothetical resource-based development has not taken place in the country. •To what extent mining resource can contribute to address development challenges.•Mining taxation should balance maximising public revenue and attracting investment.•Linkages between the extractive industry and local economic sectors must be promoted.•Use of revenue must be sound, efficient and transparent, avoiding rent-seeking and corruption.•Social spending is a priority in resource-rich countries with high level of poverty.