Natural Resources Management

Creating jobs and opportunities in developing countries

The management of natural resources in developing countries is an increasingly important driver of sustainable economic growth. It creates jobs and provides governments with revenue to deliver services to their citizens.

In 2011, exports of oil and minerals from Africa, Asia, and Central and South America were worth over (US) $1.4 trillion. This is more than 10 times the value of official development assistance provided to these same regions. Current trends suggest that the importance of the sector will increase as exploration for minerals, oil, and gas continues in developing countries.

As a result, developing countries are increasingly looking at ways to tap into the enormous potential of the extractive sector to stimulate sustainable economic growth.

Through its Sustainable Economic Growth Strategy and in support of Canada’s corporate social responsibility Strategy, CIDA works with resource-rich developing countries to:

• Build resource governance capacity to strengthen national, regional, and local governments and regulatory institutions so they can manage the extractive sector transparently and responsibly

  Canada's support helps equip governments with better knowledge about their own natural resources and assists them in making specialized decisions at all stages of exploration, development, and operation in the extractive sector.

  Canada is assisting governments establish and implement policies, regulations, and human rights frameworks that help citizens benefit from the mining and extraction of natural resources. Canada's support is also helping developing countries improve the financial and economic management of their natural resources, including establishing sound taxation and revenue-management systems.

  Canada is establishing the Canadian International Institute for Extractive Industries and Development under CIDA's Partnerships with Canadians Programs. This new institute will be housed at the University of British Columbia, working in partnership with Simon Fraser University, It will contribute to sustainable economic growth, job creation and long-term efforts to reduce poverty in developing countries. The institute will:

  • Help increase the capacity of governments in developing countries to responsibly and transparently manage their extractive industries
  • Train specialists needed for the mining, oil and gas industries
  • Carry out applied research on leading practices for managing natural resources to advance economic and social development

  Through the United Nations Economic Commission for Africa, Canada is also providing support to the new African Mineral Development Centre, as announced in January 2013. The Centre will deliver guidance and policy advice to African countries on how to manage their extractive sectors responsibly and transparently. The Centre will also provide a forum focused on generating innovative approaches to increase the contribution of the extractive sector to reduce poverty in Africa.

• Grow businesses and improve local economic development through economic diversification and local value creation

  Canada is helping to foster economic development in resource-rich developing countries by increasing access for local micro, small, and medium-sized businesses operating in and around the extractive sector to skills development, technology transfer, and technical and vocational training, in order to improve their profitability, productivity and integration into the formal economy.

  Through Canada's efforts to grow businesses and improve local economic development, CIDA supports efforts to reduce economic barriers for women to access employment in and around the extractive sector, particularly in the formal economy.

• Invest in people and enable local communities to maximize benefits from the extractive sector to promote inclusive growth and community empowerment

  Canada is assisting communities and people in need to work towards and realize the greatest benefit from the mining and extraction of natural resources. This means providing support to address the challenges often associated with the sector, strengthening governance capacity at all levels of government, improving community engagement, revenue collection and transparency, developing specialized human resources, and providing effective environmental oversight.

In addition, CIDA works to advance international standards and guidelines to improve performance by all actors involved in the extractive sector.

CIDA's actions at a glance

Andean region:

• Building local government and community capacity in the Andean Region to implement sustainable development projects that benefit people living near extractive operations, and to improve dialogue with the private sector.

Bolivia:

• Increasing the revenue of Bolivia's government from the hydrocarbon sector from $500 million in 2004 to $2.2 billion in 2010—more than a 30 percent increase in total budgetary revenue that is being redistributed through social services to people in need.

Colombia:

• Building government and community capacity to identify, plan, and manage development projects that address the social and environmental dimensions of extractive sector development and create sustainable economic development.

Latin America and the Caribbean:

• Contributing to the sustainable development of indigenous peoples in the Latin American and Caribbean region. For example, the Mining Sector Indigenous Capacity Building project, under CIDA's Indigenous Peoples Partnership Program, helped develop and implement strategies to further Indigenous rights, processes, and aspirations. It also helped change national policies and corporate practices to ensure more equitable decision-making and development processes on or near ancestral lands.
• Helping develop guidelines and a corporate social responsibility management system to assist members of the Regional Association of Oil and Natural Gas Companies in Latin America and the Caribbean to improve their social and environmental performance in the oil and gas sector.

Peru:

• Strengthening the capacity of the Ministry of Energy and Mines to manage public companies in the energy sector and to encourage the development of renewable energy sources, assisting the federal Ministry of Economy and Finance in adopting a new extractive sector model for collecting resource royalties, and helping municipalities to establish sound resource-management practices.

Tanzania:

• Supporting the role of the Tanzania Minerals Audit Agency in monitoring and auditing mining operations in order to improve environmental management and facilitate the maximization of Government revenue from the mining sector, enabling the government to reduce poverty and improve the delivery of services to Tanzanians.

Pilot projects in partnering for development

CIDA is investing in pilot projects led by non-governmental organizations, which leverage private sector funding to advance sustainable development objectives. Pilot projects underway include:

• Working to improve education, water, and sanitation services for 134,000 residents in 12 mining communities of Ghana through a partnership with World University Service of Canada, with co-financing from Rio Tinto Alcan.
• Working with national and local governments in Peru to enable the more equitable distribution of mining revenues to help build local economies and diversify agricultural production to benefit 1,000 families through a partnership with World Vision Canada, with co-financing from Barrick Gold.
• Working to train approximately 10,000 young people in Burkina Faso to gain the skills and knowledge necessary to secure jobs through a partnership with Plan Canada, with co-financing from IAMGOLD.

Driving the development of new and innovative approaches for natural resources management

CIDA is focusing on growing economies more sustainably, managing resources more responsibly, and working more closely with the private sector and other partners to advance global development objectives.

Through this work, Canada's leadership is helping to unlock the economic potential of the developing world, reduce poverty, and build tomorrow's markets for trade and investment.