Raw materials – an opportunity for sustainable economic development

Cobalt in metal cans at the Mopani copper mine in Kitwe, Zambia

Mineral and energy resources are of key importance worldwide, especially for industrialised countries like Germany. Without them, the technical advances that are a part of our modern lives would not exist. At the same time, such raw materials are a major source of income for many developing countries. As the demand for raw materials is growing, the extractive sector provides opportunities for social, political and economic development in these countries. Yet where there is poor governance, extractive projects can also lead to negative developments such as corruption, environmental pollution or social conflict.

Extractive raw materials are location-specific, non-renewable and unequally distributed around the world. Whilst many developing countries are primarily exporters of raw materials, the demand for raw materials in most industrialised countries and emerging economies exceeds their own production volumes, which makes them dependent on imports. To ensure that every country has access to the raw materials it requires, there needs to be fair trade in raw materials and processed goods everywhere in the world.

German development cooperation measures

German development cooperation is aimed at supporting partner countries in using their resource wealth for their own development. Good governance is a central factor for establishing a sustainable raw materials sector. The BMZ Strategy Paper on "Extractive Resources in German Development Cooperation" sets out five ways of promoting a sustainable raw materials sector in developing countries:

  • utilising the raw materials sector to develop and strengthen the economy, creating more added value locally
  • developing efficient and effective structures in the extractive sector, creating an appropriate public enabling environment
  • establishing transparency for commodity and payment flows
  • establishing ecological and social minimum standards
  • making better and more efficient use of extractive resources.

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