ICMM Publishes Two Reports That Show the Mining Industry’s Economic Contribution To Host Countries Across the World
London, UK – ICMM today publishes two reports – the 6th Edition of The Mining Contribution Index (MCI) and the ICMM Members’ Tax Contribution Report: 2021 Update – that highlight the contribution the mining industry makes to the economies of host countries.
The MCI synthesises into a single number, and associated ranking, the significance of the economic contribution mining makes to national economies through four key indicators. Since ICMM first published the report in 2014, the data has consistently shown that mining remains the primary driver of economic activity in many low and lower-middle income countries.
The 2021 update of the ICMM Tax Contribution Report contains the corporate income tax (CIT) and royalties paid by ICMM members in the accounting period from June 2013 to June 2021. CIT and royalties are important indicators of economic contribution, and transparent disclosure of this data helps civil society to hold governments to account for revenues paid.
The Mining Contribution Index: 6th Edition
The MCI shows that between 2016 and 2019, many of the world’s poorest countries relied on the income from mining as the primary source of economic activity. As a result, 23 of the top 25 countries in this edition qualify as resource dependent using the critical applied in ICMM’s 2021 Social Progress in Mining-Dependent Countries Report. Almost two-thirds of these countries are categorised as low or lower-middle income countries.
There was a significant amount of change within the top 25 countries with 10 new entrants including Liberia, Mauritania, Uzbekistan, and Papua New Guinea. This can be attributed to their endowment of precious metals and minerals, which saw a 13% increase in global exports from 2018 to 2020. This is likely due to investors turning to these materials as a safe haven in light of uncertainty stemming from the COVID-19 pandemic. Burkina Faso took first spot, with an increase across all metal and mineral contribution indicators, and a rise in its GDP.
ICMM Members’ Tax Contribution Report: 2021 Update
This report shows members’ overall tax contributions made up to the financial year ended 30 June 2021. This coincides with the beginning of the COVID-19 pandemic and increasing commodity prices seen in 2020 and into 2021. The report shows higher profits for the sector and a 27% increase in the amount of overall corporate income tax and royalties paid to host governments.
ICMM members reported a total corporate income tax charge (excluding deferred tax) of US$20.8bn (an increase of over US$5bn), and a royalty charge of US$9.4bn. Excluding impairments and other exceptional items, current corporate income tax and royalties charged in 2021 were 32.6% of adjusted profit before tax.
When done responsibly, mining can play a truly transformational role in the economic development of host countries. Both the MCI and Tax Contribution Reports help us to understand the role of mining in national economies and underscore the importance of mining to some of the poorest countries in the world. As countries continue to set targets to enable the energy transition, demand for the critical minerals needed for clean energy technologies will grow. This only heightens the importance of transparent disclosure, and the continued push for good governance of mineral resource wealth.
“These reports only show part of the picture on contribution. In 2022 our members committed to report on a wider set of social and economic indicators set out in our Social and Economic Reporting Framework. Members have also committed to disclose all mineral development contracts granted from 1 January 2021. These are both important ways for citizens and other stakeholders to hold governments and companies to account, and for us to build a more complete picture of the industry’s wider contribution to host counties.
Notes to Editor
- Previous editions of the ICMM Tax Contribution Report can be found here – 2020, 2019, 2018
- Previous Editions of the MCI Report can be found here – 5th Edition, 4th Edition, 3rd Edition, 2nd Edition, 1st Edition
- The ICMM Social and Economic Reporting Framework can be found here
- The ICMM Social Progress in Mining Dependent Countries Report can be found here
ICMM stands for mining with principles. We bring together a third of the global metals and mining industry, along with key partners to drive leadership, action and innovation for sustainable development, ultimately delivering a positive contribution to society. Through collaboration, ICMM member companies set the standard for responsibly produced minerals and metals in a safe, just and sustainable world.
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