Metals mining and sustainable development in Central America
An assessment of benefits and costs
Published: July 2008
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Publication Summary
Despite its long history in Central America, mining has never played a significant role in the economies of Guatemala, Honduras, and El Salvador. Even if all the resources of these nations were developed, revenue from minerals would amount to only a small fraction of their broadly diversified economies.
What the mining industry could contribute to these countries must be balanced with the full scope of its costs. From a financial perspective, mining has some drawbacks. Meanwhile, large-scale open-pit mining poses environmental risks ranging from acid mine drainage to tailings dam leaks.
The current debate surrounding mining in the region, especially in El Salvador, reveals a dangerous misunderstanding of the potential costs and benefits of aggressive development. The World Bank and other institutions have conducted research that indicates that resource development often has a minimal impact on poverty alleviation efforts. Mining communities throughout the world know firsthand that those closest to mining development get hit the hardest.
If mining is to realize any of its promise, it must be done with the full sanction and support of local communities. The mining industry must respect local communities’ right to free, prior, and informed consent. Furthermore, it must integrate tightly into local economies and allow for cooperative decision-making on a continuing basis. If these circumstances do not exist, communities have grounds to reject mining projects—because the costs will likely outweigh the benefits.