Workshop on the Rule of Law, Governance and Natural Resources
22nd – 23rd January 2015
University of Amsterdam
Workshop funded by:
Sam Adelman (Law School, University of Warwick)
Ana Elizabeth Bastida (School of Law, University of Dundee)
Mirza Satria Buana (University of Queensland)
Felix Conteh, Deval Desai, Nat King, Nick Menzies, Jared Schott (World Bank/SOAS)
Daniëlla Dam-de Jong (Grotius Centre for International Legal Studies, University of Leiden)
Ellen Desmet (Law and Development Research Group, University of Antwerp, and Human Rights Centre, Ghent University, Belgium)
Michael Fakhri (School of Law, University of Oregon)
Elizabeth Fortin (School of Law, University of Bristol)
Rodrigo Gutierrez (Institute of Legal Research, National Autonomous University of Mexico)
Susann Handke (School of Law, University of Rotterdam)
Deborah Isser, Catherine Anderson and Jared Schott (World Bank)
Annegret Mähler and Almut Schilling-Vacaflor(GIGA Institute of Latin American Studies, University of Hamburg)
Aoife McCullough (Overseas Development Institute, UK)
Jewellord T. Nem Singh, Jean B. Grugel and Pascale Hatcher (Sheffield Institute for International Development, University of Sheffield)
David M. Ong (School of Law, Nottingham Trent University)
Lorrenzo Pellegrini (International Institute of Social Studies, Erasmus University Rotterdam)
Recardo Pereira (Westminster Business School, University of Westminster)
David Szablowski (Department of Social Science, York University, Canada)
Javier Tous (Universidad del Norte, Colombia)
Koen de Feyter (School of Law, University of Antwerp)
Julio Faundez (School of Law, University of Warwick)
Ronald Janse (School of Law, University of Amsterdam)
Celine Tan (School of Law, University of Warwick)
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The Rule of Law, the Rule of Capital and Mining in Post-Apartheid South Africa
The shooting of 34 unarmed platinum miners by the police at Marikana, South Africa in August, 2012 recalled the lawlessness and repression that characterised apartheid and raised questions about the efficacy of the rule of law since the transition to democracy in 1994. The difference this time was that both perpetrators and victims were part of the black majority. Post-apartheid South Africa exemplifies E P Thompson’s observations about the contradictory nature of the rule of law. The achievement of formal equality under a constitution guaranteeing the rule of law is a significant advance, but this does not hide increasing substantive inequality arising from the ANC government’s pursuit of neoliberal economic policies and widespread corruption. Whereas the courts have been bulwarks against the erosion of the rule of law, the police are endemically corrupt and violent. It is against this backdrop that worker’s struggles in the mining industry must be understood. Mining is still the backbone of the South African economy but its importance is declining. Julius Malema’s minority party, the Economic Freedom Fighters, has called for the nationalisation of the mining industry. The Commission of Inquiry into the Marikana massacre is due to report in December, 2014. The response of the ANC government to the biggest national trauma after apartheid will have potentially profound implications for the rule of law in South Africa.
Evolving Rights-based Approaches to Land Access and Use under Resource Tenure Regimes: A Critical Appraisal
The basic principle of traditional tenure regimes drafted in mining and oil and gas laws has been towards precedence of resource extraction over existing land use patterns. It has been typically assumed that a particular piece of land will produce more value if resources are extracted than if used for other purposes, and thus should be developed independently from the landowner’s will. Public interest reasons (as historically interpreted) have typically justified the legal distinction between ownership of the land surface and of the subsurface, with preference being assigned to subsurface resource extraction activities over other uses of land. The rules of compensation of surface owners also reflect the precedence principle.
The evolving recognition and development under international and domestic law of the protection of biodiversity, heritage sites, cultural and environmental values; human rights, and the rights to land of indigenous peoples, as well as emerging governance regimes applying these rights, are redefining the extent of landsavailable to extractive industries, and the scopeand contoursof the rules of engagement of resource rights holders and surface owners and holders (particularly those in vulnerable situations). All of these rights-based developments are crystallizations of an expansive, environmentally and socially constructive? view of ‘development’ as encompassing the rights of those affected by resource projects; changing views of land as a multidimensional store of value, with more value assigned to other land uses such as such as conservation, wilderness, landscape, forestry, recreation, farming, urban settlement; and increased consideration for the internalization of all impacts as operational costs, among other factors. The debate on a post-2015 development agenda (redefining the Millennium Development Goals an the outcomes of Rio +20) is further legitimizing the need for integrating environmental, social and economic considerations in development.
This paper will identify and examine the emerging legal and governance developments which incorporate a rights-based perspective to ‘development’ and then assess the design of rules and processes for access and use of land under resource regimes from this perspective to see whether such resource regimes are beginning to take cognizance of these emerging legal developments.
Development and Access to Justice: Enigma of Natural Resources Disputes: A Comparative Socio-Legal Study in South Kalimantan, Indonesia
Development is the nemesis of culture, notably in a developing country like Indonesia. This paper explores the fundamental problem of how to ease the tension between development and culture, a challenge that Indonesia, a naturally, resource-rich, developing country, currently faces. Indonesian Agrarian Law explicitly states that the guiding law of Indonesia’s development is the living adat law. Nevertheless, its implementation is still misguided. Indigenous peoples and their values, as guardians of a village’s normative inner-ordering and natural resources, are often ignored by the State. Without legal protection and affirmative action, their existence is challenged both internally and externally. From the New Order development regime to the Reformation era, a massive extraction of natural resources within Indonesia’s archipelago has occurred. This situation has been worsened by the decentralization of natural resources management to the local governments, and ineffective State litigation in settling natural resources disputes.
Despite these encroachments, there are also several recent breakthroughs in Indonesia’s legal system. First, Indonesia has ratified several international law instruments relating to environmental preservation, human rights and the protection of indigenous peoples. These conventions may convey a global justice perspective to the national law. Second, Indonesia’s judicial system under the Supreme Court has undergone a gradual reformation, which may be a generator for settling natural resources disputes. Third, the Constitutional Court has radically reviewed several pieces of legislation related to natural resources, notably the Forest Law. The progressiveness of both the Supreme and the Constitutional Court can bridge the gap between the rule of law and the protection of non-renewable natural resources. Lastly, the new Village Law provides many opportunities for strengthening village normative inner-ordering, and is an effective way of conveying social justice and access to justice perspectives in the national law.
In order to link national and regional specific issues, this paper examines two case studies from the South Kalimantan Province. The cases illustrate how both Traditional Dispute Resolution (TDR) and State Courts settle natural resources disputes involving indigenous peoples, the local government and corporations. The research shows that neither TDR nor the State Courts are fully able to settle disputes and there are several factors that contribute to this, such as: weak leadership of the tribal chief, internal encroachment on the living adat law, economic motives, procedural-minded judges and partial law enforcement. A comparative approach adds an interesting dimension to the socio-legal studies by presenting the two contradicting practices of TDR and State Courts. Both institutions and their practitioners have demonstrated non-mainstream practices and there is rigidness in TDR and flexibility in the State Courts, and vice versa.
Current judicial reforms focus primarily on institutional and substantive law reforms, which may be ineffective in practice. This paper emphasizes judicial reforms for tribal chief within the indigenous village and judges and justices within State Court system, not as an institution but as individuals, because these legal practitioners are the conveyers of social and global justice, and the final interpreters of the living adat law and the ambiguous word of ‘development’.
Community Development Agreements and the Rule of Law: From Law to Governance of Extractive Industries
Community Development Agreements (CDAs) are an increasingly popular policy tool in the extractives sector. They seem to offer a new way of articulating the company-community relationship, one that is popular across a range of stakeholders - communities, civil society, companies and governments. CDAs are currently understood as legal documents, signed or agreed to by key parties concerned (generally referred to as “stakeholders”). They fit within an emerging rule of law discourse emphasising the legalisation of complex notions of power, authority and governance at the sub-national level ("local rule of law").
This paper critically interrogates the adoption of CDAs as a policy tool by the international community, civil society, host countries and host communities. At a theoretical level, we intervene by suggesting that the "rule of law" is not and should not be a language of legalisation; rather, the rule of law discourse operates in the other direction, redirecting those who would seek refuge in the certainty of law to the messiness of governance. We encourage a view of CDAs as ongoing governance frameworks and not legal documents, suggesting an emphasis on the process of negotiation and implementation and not on the drafting of the agreement. We then ask what - if anything - we can ascribe in form or substance to a CDA. Drawing on ongoing World Bank empirical research on the process of CDA implementation in Sierra Leone, we suggest that there is currently very little to say about either: key questions, from the very identification of the "community" to the amount and form of community development activities, are deferred to unclear moments of future decision in the process. This, we argue, is not necessarily a weakness but rather a strength of the CDA - it is capacious, allowing many stakeholders to get behind the idea of community development without having to fall out over the details. We draw on the ethnographic side of the research: to explore the dynamics of this process of "filling in" the CDA, focussing on how actors strategically contest the scope of the CDA; to ascertain on what terms they are able to engage and communicate their interests; and to assess how they strategically use the language of the CDA to pursue their own ends, with a particular emphasis on what, if anything, it means for community members themselves. In doing so, we suggest that this perspective on CDAs might form the basis for a more durable and effective set of partnerships between companies and communities, informed by the complexities of existing governance structures and legal institutions that form the substance of the "rule of law"
Daniëlla Dam-de Jong(Grotius Centre for International Legal Studies, University of Leiden)
The role of informal normative processes in improving governance over natural resources in conflict-torn states
Natural resources, including diamonds, gold and precious metals, play a key role in financing some of today’s most violent armed conflicts, including those that are currently fought in the DR Congo and the Central African Republic. In the DR Congo, armed groups have taken over control over important mining sites in the east of the country, permitting them to obtain a source of conflict funding from the exploitation of gold and precious metals. In the Central African Republic, armed groups have gained full control over the diamond production of the country after launching a successful coup d’état in May 2013.
These are just a few of the most recent examples of natural resources financing armed conflicts. Although not a new phenomenon, recent decades show an increase in this type of conflict financing. Since the end of Cold War rivalry, external sponsoring of armed groups fighting in internal armed conflicts has largely dried up. As a result, armed groups have increasingly turned to natural resources as an alternative source of conflict funding.2 Since the trade in valuable natural resources provides these armed groups an independent source of income to finance their activities, stopping the trade in natural resources that finance armed conflicts is therefore essential to ending these conflicts.
This has been recognized by the UN Security Council in its resolutions and Presidential statements. The Council has adopted several sanctions regimes targeting specific commodities on a case-by-case basis. Examples include the diamond sanctions imposed against Angola, Sierra Leone and Liberia. In other instances, the Council refrained from imposing commodity sanctions proper, but, instead, targeted individuals and companies involved in the trade in conflict resources, i.e. natural resources traded by armed groups to fund their activities. An example concerns the sanctions imposed against individuals and companies providing support to armed groups in the DR Congo.
The success of trade-related sanctions depends however on effective control mechanisms and cooperation between States and companies in implementing the sanctions. This article reviews some of the principal instruments which have been set up in recent years to address the trade in conflict resources. More in specific, it discusses the Kimberley Process Certification Scheme for Rough Diamonds (KPCS) and the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas (OECD Guidance). This paper addresses the following questions: which mechanisms do these instruments establish to stop the trade in conflict resources, and to what extent do they contribute to improving the governance of natural resources in conflict-torn States?
Natural Resources Legislation In Peru: A Critical Analysis from A Socio-Legal Perspective
Natural resources are the subject of many rights, claims and interests, held by a wide variety of actors, including local communities, indigenous peoples, state authorities, (trans)national companies and international organisations. These actors invoke diverse normative orders (international law, state law, local law, etc.) to substantiate their claims and to try to realize their objectives. Improving natural resource management and legislation requires a grounded understanding of the complex interplay between these multiple, state and non-state, legal orders, based on socio-legal research.
This paper analyses the legal relationship between extractivism, conservationism and the rights of indigenous peoples and local communities in Peru, drawing on ethnographic fieldwork carried out in the Peruvian Amazon. It shows how transnational interests in hydrocarbon exploitation, on the one hand, and nature conservation, on the other, materialized in a remote area in the extreme north of Peru, and how the multiplicity of applicable normative orders and the divergent reactions of the local population influenced the course of events.
The Peruvian natural resources legislation is critically reviewed ‘from above’ – mainly from the perspectives of international human rights law and international environmental law –, as well as ‘from below’ – based on the case-study in the Amazon region. The main directions of interaction between these normative orders are also identified and assessed. Challenges for (Peruvian) state legislation include avoiding ‘empty’ recognitions of rights,finding a balance between indigenous peoples’ rights and the rights of local non-indigenous persons and groups, not making the recognition of fundamental rights dependent on (sustainable) natural resource practices, and opening up legislation towards non-Western resource management practices – implying an evolution towards a more sustained ‘conservation pluralism’.The paper moreover argues that local experiences should inspire more firmly the development of resource management legislation, and gives concrete examples of where this could be done.
What Does Food Have to do with Global Law and Governance?
Different terms in food politics – food security, food justice, right to food and food sovereignty – are difficult to precisely define. I find that food sovereignty is the most interesting because it may provide an opportunity to transform how most people in the world grow and access their food. Despite the use of the juridical term "sovereignty", law is a latecomer to these debates. I suggest that the lawyers’ task should be to support and develop laws that ensure that the food sovereignty movement remains supple to global politics and resilient to global ecology.
Food sovereignty has largely emerged from transnational peasant movements, which provides its original social context. Nonetheless, it is now being incorporated into formal laws. I quickly discuss two examples where food sovereignty has been explicitly evoked in law: a 2011 local ordinance and state supreme court case in Blue Hill, Maine; and the 2008 national constitution in Ecuador, food sovereignty was written into the constitution in 2008. The limits of these approaches is has been that it has been informed by a theory of law that based on an assumption that law’s purpose is to mediate the relationship between the state and individual.
I suggest in this paper that the food sovereignty movement should not be making an ideational alliance with this particular (liberal, public) conception of law. Rather, I put forward that since the food sovereignty movement is made-‐up of a wide array of people, interests and communities that it needs a broader concept of law. Namely, an understanding of law that appreciates that life is made up of a whole slew of relationships – commercial, kin-‐based, professional, social, aesthetic, etc. In legal scholarship, this understanding can be found in discussions and arguments over the concept of transnational legal pluralism.
I ground this theoretical argument in a particular public debate. I spend the bulk of the paper teasing out the broader implications of the 2011 debate over food security between Pascal Lamy (Director-‐General of the WTO) and Olivier De Schutter (UN Special Rapporteur on the Right to Food). The WTO has always been one of the food sovereignty movement’s targets. Moreover, De Schutter’s work as Special Rapporteur has aligned with and has been supported by the food sovereignty movement. Because of each person’s institutional role, the debate was not only about food but also about two different understandings of global law and governance. In closely reading the official reports and letters of this debate, and addressing the debate’s limits, I put forward a legal research agenda that may offer the food sovereignty a wider conceptual repertoire of institutional and legal options.
The Struggle for Social Rights and Indigenous Rights in the Framework of Neo-Extractivism in Mexico
The main aim of this paper is to problematize the relation between the use of the discourse of rights and the troubling effects of neo-extractivism. This latter term is used to describe the unsustainable practices of the global market that is currently stripping Mexico and other Latin American countries of their common goods, in an aggressive process enshrined by national legal frameworks and international law of the markets. In the first section of the draft study, we present theoretical bases to move toward a definition of neo-extractivism as a category that helps further knowledge about how the deregulation of land, water, subsoil or energy markets, among others, is exacerbating inequality, impunity and violations of human rights in Latin America, with a particular focus on Mexico.
This article also sets out to reveal the numerous and expanding methods being employed to resist neo-extractivism and to defend territories and natural resources; we also examine the combined exercise of social and institutional guarantees that have been implemented by different groups and communities in order to defend their human rights. In this order of ideas, we should draw attention to two legal phenomena: a) how these processes have been causing jurisprudential criteria, both in comparative law and in the inter-American human rights system, placing special emphasis on the right to consultation and consent; b) the construction of an agenda aimed at pushing forward the discourse of rights versus the violations caused by the international extractive industry, in an attempt to develop processes that establish companies’ responsibility for violating human rights.
Stakeholder Engagement in Producing ‘ Hybrid’ Governance; Resolving ‘Sustainability’ in Standards Processes
Tempering the unsustainable fallout of global agricultural production processes often falls to a range of alternative regulatory mechanisms. Sustainability standards and certification schemes, which are monitored by third-party auditors, have become one form of ‘hybrid’ governance designed to encourage more sustainable practices in the management of natural resources. For example, in relation to bioenergy production, a number ofsustainability standards schemeshave been approved by the European Union under its 2009 Renewable Energy Directive (EU RED), and compliance with EU RED sustainability criteria is only proved by a firm receiving third party certification that their operations satisfy one of the approved schemes. The Roundtable on Sustainable Biomaterials (RSB) is an example of one such scheme approved by the EU Commission. This RSB scheme is often referred to positively not only for providing an example of a ‘multi-stakeholder’ model of standards development that is assumed to confer greater legitimacy on the outcome of that process – the sustainability standards themselves – but also because those very standards are considered to exemplify greater rigour than many of the other EU-approved standards in terms of their claims to protect ‘sustainability’. Recognising that the discourses of ‘sustainability’ contain within them varying and contradictory notions, the resolution of which will be determined by power relations, this paper explores the standards processes in which the RSB standards were produced. It considers how notions of sustainability embodied in the RSB standards were shaped not only by the very ‘multi-stakeholder’ process itself, but also by wider influences that were brought to bear in that process, including the growing spectre of a ‘standards market’ produced by the EU’s approval of different schemes. In doing so, the paper draws upon the author’s primary research with many of the ‘stakeholders’ that contributed to the process. Itcontributes to previous research (Maconachie & Fortin 2012, also presented at the 2012 workshop on ‘ International Law, Natural Resources and Sustainable Development’ held in Warwick), which considered the importance of recognising varying and contradictory interpretations of ‘sustainability’ on the ground in the context of a major biofuels investment in Sierra Leone.
The Feasibility of Non-Interference in Internal Affairs: The Chinese Legal Discourse on Sino-Sudanese Oil Cooperation
Chinese energy companies are increasingly involved in crude oil production abroad. In recent years, their purchases of assets expanded rapidly, mainly in developing states. The Chinese government applies the principle of non-interference in the internal affairs of host states. This principle belongs to the so-called Five Principles of Peaceful Coexistence – an important doctrine of China’s foreign policy. However, with assets at stake in unstable regions, which are worth billions of dollars, the principle of non-interference in domestic affairs can hardly be maintained. Thus, this paper examines the limits of this approach, in particular with respect to the exploitation of natural resources in developing states, and explores the possibility of alternative forms of governance.
The paper uses Sudan as a case study. The Chinese practice of acquiring equity in projects or stakes in energy companies was first established in Sudan in the 1990s, which is now referred to as the “Sudan model.” Investments have been realised through CNPC, a large state-controlled energy company. The Chinese government encouraged CNPC to gain experiences abroad. This paper examines how Sino-Sudanese oil cooperation developed against a backdrop of internal conflict and human rights violations in Sudan and international criticism of China’s engagement in this country. The principle of non-interference has become almost impracticable after the secession of South Sudan and the resulting division of China’s oil assets between the two states, with oil fields in the south and the main transport infrastructure in the north. Conflicts between Sudan and South Sudan about transit fees as well as civil war in South Sudan halted oil shipments and caused economic losses. As a result, China’s position on internal affairs of host states is evolving. The new approach includes calls for conciliation between the conflict parties and facilitation of peace negotiations. The tenor of the discourse among Chinese scholars also reflects the necessity of a more active role.
This paper assesses the ongoing Chinese debate about the consequences of growing economic involvement in conflict regions. The analysis is based on academic articles published in Chinese. The study centres on the question of how Chinese legal scholars and political scientists envisage China’s responsibility in the context of large investments in politically unstable regions. It discerns how this debate conceptualises the rule of law in international society and China’s role in international governance. The discussion of the findings focuses on the interaction of concepts that shape the debate – i.e. energy security, China’s responsibility in international society, and the rule of law. Analysing the discourse among Chinese scholars helps to draw conclusions about the construction of perceptions and ideas that inform China’s potential contribution to the international system of governance and regulation with respect to natural resources.
Toward Equitable Natural Resource Management in Liberia: A Focus on Citizen-Engagement
The ascent of the extractive industries on the African continent has given rise to an extensive body of scholarship and practice in natural resource governance. In the main, this work follows a conventional course; it speaks to the economic effects of resource abundance – Dutch Disease, cyclical patterns of booms and busts and inflation – and to the corrosive influence of resource wealth or ‘Rentier Statism’ on institutional governance, prescribing a series of ‘remedies’ to counteract these trends. Yet, while this legal/regulatory and institutional learning is proliferating, comparably less attention is paid to examining the knock-on effects or socio-economic impacts of these varying NRM strategies on a host country’s citizenry, and its links to localized grievance and conflict. Indeed, evidence on the links between upstream interventions and their downstream impacts is thin, and a mismatch often exists between citizen-state-investor perspectives and expectations, and this can contribute to existing local level frictions. This gap is particularly keenly felt in fragile and conflict affected settings where low trust, deep social cleavages, institutional atrophies and unstable political settlements are prominent, and in which a more tractable approach, citizen-oriented approach could make the difference between a peaceful transition or a return to violent conflict.
Adopting the Natural Resource Value Chain (‘the Value Chain’)1 schematic, this paper combines case-based research and process tracking to examine the nature and source of disputes, and the quality of citizen engagement in concessions management in Liberia. A central organizing premise of this work is that by improving the nature and quality of citizen engagement and giving emphasis to the nexus of citizen-state-investor interests at salient junctures of the NRM value chain. GoL can work to reduce social and political cleavages, and lessen the risks of conflict in natural resource management. This work also seeks to draw the links between legal/regulatory and institutional interventions and their community level impacts. To make the value chain more accessible to a wider body of NRM scholarship and practitioner, this work has redacted the value chain to three critical procedural steps – making the deal, managing production impacts and sharing resource benefits – and at the same time aims to draw out the linkages between each of these steps.
Site Fights: Explaining Varying Levels of Contestation over New Gas Projects in Indigenous Territories in Bolivia
Responding to the lack of the study of “site fights” in developing countries, on the one hand, and the neglect of more structured comparisons of cases of mobilization and non-mobilization, the paper explores different levels of local contention that emerged within 30 environmental licensing process of gas projects in indigenous territories in Bolivia. It shows that due to a mix of limited political opportunity structures, high levels of economic hardship of the local communities and benefits coupled to the execution of the projects at stake, very little outright rejection of extraction projects by the affected communities arose. Subsequently, the study applies Fuzzy Set Qualitative Comparative Analysis (QCA) to systematically scrutinize why some licensing processes were more contentious than others. Three central pathways are detected through which local contention can be explained. The article’s main findings reveal that site fights in non-Western, post-colonial contexts tend to follow different logics than the ones that have been previously discussed for countries in Europe and the United States.
Increasing Civil Society Participation in Concession Negotiations in Liberia
Since emerging from conflict nearly a decade ago, the extraction of Liberia’s natural resources including timber, iron, gold and agricultural land has been a key strategy to produce economic growth and create jobs. Conservative projections indicate that the State has committed itself to issue long-term land use rights over an area that corresponds with some 75% of the total Liberian land mass . In response, many NGOs, both national and international, have focused their activities on increasing civil society participation in concession negotiations to support communities in getting better deals. In this report, space for civil society participation in concession negotiations is explored in light of the political and economic realities of Liberia. The legislation that provides for civil society participation in concession negotiation processes is first examined followed by an investigation into what is actually happening in relation to concession negotiations. Finally, recommendations on what entry points may be most effective for increasing civil society participation in concession negotiations are proposed.
Can Extractive Industries Deliver Poverty Reduction? Lessons from Mongolia and the Philippines
Since the 1980s, through the support of international organizations and foreign investors, resource-rich countries have embraced large-scale and foreign direct investment (FDI)-driven type of mining management models. In this context, our paper maps out the changing politics of domestic resource mobilization in the context of mining countries. Specifically, we ask two key questions: Can the renewed pressure for the EI to further contribute socially and economically open up new opportunities to promote a more effective and stable relationship between states and extractive industries? Secondly, will this new context provide resource-rich, developing states enough leeway for mining revenues to be socialized towards welfare and poverty reduction?
Our paper suggests that the failure to create a stable relationship between the states and EI is rooted on the limited and policy approach at the national and international levels, an approach which attempts to deal with highly political issues via technocratic means. What is missing is a critical discussion of political capacity, which underpins the capability of national states to exercise leverage vis-à-vis multinational mining companies to pay for more taxes, invest on technological innovation, and support local processing of raw material exports. We draw examples from Mongolia and the Philippines in substantiating these arguments. On the one hand, these two countries are considered strategic mining producers in terms of their mineral reserves, and therefore, courted foreign direct investment (FDI) for the development of their EI. On the other hand, both countries responded to existing welfare gaps by advocating for the expansion of EI while at the same time seeking for compensation via taxes and CSR initiatives.
Ensuring Public Accountability for Private International Financing of Natural Resource Development Projects: The Equator Principles (Mark III)
A striking feature of public international financing of natural resources development projects in developing economies is the development of public accountability mechanisms to ensure that these projects comply with social and environmental principles and standards. For example, natural resource development projects funded through the World Bank group are subject to the Inspection Panel mechanism in relation to complaints of the negative social and environmental impacts of such projects. As the public international financing of such projects is increasingly giving way to private international finance, this paper will first examine whether similar accountability mechanisms have been developed for this type of financing for such projects. Within this context, the third iteration of the Equator Principles has recently been adopted by a growing number of private international financing institutions in the ‘project finance’ field, namely, the Equator Principles Financial Institutions (EPFIs). By comparing the accountability mechanisms established by public and private international finance institutions against objectively set criteria for such mechanisms, this paper will assess whether there has been a diminution of accountability standards in the movement from public to private financing of natural resources projects, especially within developing economies.
Participation and Compensation in the Context of an Expanding Extraction Frontier: The Case of Oil Exploration in the North of La Paz, Bolivia
The turn to the left that marked Latin American politics in the last decade comprises wide ranging changes in a number of countries including Bolivia. Bolivia was traditionally ruled by a conservative establishment and political instability has marked a decade of conflicts that culminated in the ascendency of the ‘Movement Towards Socialism’ (Movimiento al Socialismo, MAS) and in 2006 of the first indigenous president came to power– President Evo Morales. The election of Morales and the subsequent changes to the Bolivian state have been hailed as revolutionary (Dunkerley, 2007), while some authors have argued that the changes associated with the left turn essentially consist of a continuation and re-constitution of neo-liberal regimes (Webber, 2010). Here we highlight the changes to compensation and redistribution policies that have accompanied the nationalization of hydrocarbons and the institutionalization of consultation processes of indigenous people.
In this context, we analyse an oil exploration project that took place in the north of the La Paz Department. In particular we focus on how the compensation and consultation frameworks have conjured to debilitate opposition to the extractive project. We conclude that the government’s priorities are intertwined with the continuation and further intensification of the extractive economic model, essentially an ‘ extractive imperative’. Under these circumstances questioning extractive projects is not an option and participation and compensation become functional to these projects.
Developing the Principles of International Law for Interstate Cooperation and Governance of Shared Natural Resources
Interstate cooperation for the management of shared natural resources poses significant challenges to international law. When natural resources are found in areas beyond national jurisdiction (e.g. in the deep sea bed or the high seas), the need for international cooperation for the conservation and management of the resources is even more crucial. This paper examines how an international legal regime has emerged (in particular under the UN Convention on the Law of the Sea 1982 and international freshwater treaties) to facilitate interstate cooperation for the effective and equitable management of shared natural resources. In this context, this paper discusses the theories and legal principles that have emerged in international law for allocation of property rights and management of shared natural resources which are disputed between states. It analyses in particular the extent to which the principles of common management, common heritage, equitable use, equidistance and joint development have been developed in the international jurisprudence, considering in particular disputes over shared freshwater management and in maritime and land boundary disputes. In this vein, it considers the principles of international law applicable for settlement of ongoing disputes over resources rights and management, including the ongoing interstate disputes in the Artic and the East China Sea. Furthermore, it considers the extent to which the fragmentation of international environmental law poses a challenge to the effective governance of natural resources which are shared between two or more states. Finally, this paper draws on the experiences of existing intestate ‘joint development zones’ to assess whether they could provide an effective alternative to dispute settlement.
New Extractivisms and Indigenous Governance: Struggles over Indigenous Consultation Legislation in Canada and Peru
Contemporary controversies over indigenous rights are exacerbated by the fact that settler states have generally failed to grant substantial recognition to the legal systems of indigenous peoples. This disjuncture has been a major theme of the revolution in indigenous activism and rights of the last several decades. “Consultation” is currently one of the predominant concepts used in international law, private certification initiatives, and domestic law and policy to address the governance gap between states and indigenous polities. The concept proposes to connect these two legal spaces through an institutionalized process. However, consultation is a vague and contested term, capable of being expressed radically different institutional forms. As a result, the design and development consultation processes are highly contentious and can involve quite different political projects.
This paper examines and compares two cases of contested institutional change involving indigenous peoples and resource extraction. These concern the adoption of indigenous consultation legislation in Peru (2009-2013) and in the Canadian province of Ontario (2008-2012). Despite their many differences—historical, legal, political, developmental—these two cases have surprisingly close parallels. For example, governments in both cases failed to act on pre-existing legal commitments to enact consultation legislation until faced with scandalous outcomes from social conflict. Also, both governments were required to engage in consultation with indigenous peoples on their legislative proposals, resulting in a circular and disputed process of consultation about the rules for consultation.
Most importantly however, in their different ways both cases reveal the complex and difficult politics of reform within a contemporary extractivist legal and institutional framework. Drawing on the concept of extractivism,3 Eduardo Gudynas and his colleagues apply the term neoextractivism to progressive Latin American governments that have adopted new initiatives to create social support for extraction-led economies. Gudynas et al. argue these reforms (chiefly, increased state involvement in the sector, increased taxation and redistribution through social spending) fail to change or challenge the central characteristics of the extractivist economic model (including the enclave nature of the sector, its orientation to foreign market demand, a lack of domestic processing, and large environmental and social costs). Following this lead, I am using the term “contemporary” or “new” extractivisms beyond the Latin American example to refer to reform efforts that propose to legitimate resource extraction while maintaining extractivist priorities.
The Peruvian and Canadian cases show the influence of extractivist commitments on institutional development in relation to indigenous governance. In particular, the cases reveal the considerable resistance to substantive change evidenced in these examples. New extractivisms that are inclusive of indigenous governance are not easily negotiated. In addition, the cases both suggest that once reforms are underway, considerable efforts are made to shape and constrain indigenous involvement in governance in line with extractivist imperatives. Both examples suggest the potential for this to become a Faustian bargain where indigenous governance is channelled into a form of indigenous extractivism.
Human Rights and the Exploitation of Natural Resources: Mining's Nightmare in Colombia
This paper pretends to offer a critical overview and analyse the human rights violations and its relationship with exploitation of natural resources in Colombia, especially regarding the subject of mining production. The paper consists of two parts. Part 1 Evaluate the International legal rules about multinational corporations and human rights. It examines the evolution in terms of discussion at the UN, basically the different regulatory perspectives that have been approached: Global compact, Ruggie’s principles, and the Working Group on Business and Human Rights. Part 2 analyses the current outlook of the exploitation of natural resources in Colombia by multinational corporations. It is focused in mining’s production showing its relationship with human rights violations, more specifically social rights, poverty, trade union rights, and environmental rights. The paper concludes with some ideas regarding the possible solutions for corporate regulation in the near future in the exploitation of natural resources field.
1 Ballentine, K. & Nitzschke, H. (eds.), Profiting from Peace: Managing the Resource Dimensions of Civil War, Boulder: Lynne Rienner Publishers (2005); Ballentine, K. & Sherman, J. (eds.), The Political Economy of Armed Conflict: Beyond Greed and Grievance, International Peace Academy, Boulder/London: Lynne Rienner Publishers (2003); Collier, P. & Hoeffler, A., ‘ Resource Rents, Governance, and Conflict’, The Journal of Conflict Resolution, Vol. 49, No. 4 (2005), pp. 625-633; Le Billon, P., Wars of Plunder: Conflicts, Profits and the Politics of Resources, New York: Columbia University Press (2012).
2 The Extractive Industries Value Chain is a diagnostic tool or framing for NRM adopted by the World Bank.
3 A model of accumulation in which domestic concerns (developmental, environmental, social etc.) are subordinated to resource extraction for foreign markets.