MIREU is partnering up with the OECD!

The Organisation for Economic Co-operation and Development (OECD) launched in 2017 a project to develop recommendations for improving and supporting the implementation of better regional development policies in a mining and extractives context, and to increase the collaboration and knowledge sharing among mining regions and cities. As the objectives of the OECD project play well into the objectives of MIREU, the two decided to partner up and join forces!

Ilari Havukainen from the Regional Council of Lapland represented MIREU together with Ilkka Nykänen from Business Joensuu at the 2nd OECD Meeting of Mining Regions and Cities, which took place in Darwin, Australia, in November 2018. Havukainen held a presentation at the meeting, which focused on European mining conditions, European funding, and networks of mining regions such as MIREU and REMIX, as well as previous collaborations. In addition, he presented smart specialisation in the context of Lapland and the importance of European mining regions’ cooperation for future industrial policy.

In return, Lisanne Raderschall from the OECD joined the MIREU high-level workshop on ‘Policy and Governance in Mining and Metallurgy EU Regions’, which was organised in León, Spain, in January 2019 to present the OECD project and the new collaboration with MIREU. Raderschall and her colleague Chris McDonald further elaborated on the highlights from her presentation in an interview with us.

Why is the OECD involved in the Mining Regions & Cities initiative? What is the role of OECD and why is OECD´s work in this field so important?

The OECD is an international organisation based in Paris and has 36 member countries, which includes 23 who are members of the European Union (EU). The mission of the OECD is to promote policies that will improve the economic and social well-being of people around the world. The OECD does this by providing a forum in which governments can work together to share experiences and seek solutions to common problems. This work is overseen by Committees and Working Party’s that include senior officials from member countries. Non-member countries can also be invited to participate in the work of these committees.

The Regional Development Policy Committee (RDPC) was created in 1999 with the goal of identifying the nature of territorial challenges and assisting governments in the assessment and improvement of their territorial policies.  Through its mandate today, the Committee aims to serve as the premier international forum for senior-level policy makers to identify, discuss, develop, and disseminate a vision of regional development policy that is place-based, multi-level, multi-sectoral, evidence-based and innovative.

The mining of minerals and metals, extraction of coal, oil and gas, and downstream production affects virtually all OECD member countries. Regions with a specialisation in mining and extractive industries are engines of growth for many OECD countries. For example, across a sample of 11 OECD member countries there are 83 regions with a specialisation in mining and resources, which represents 45% of the regions in these countries. These regions have unique characteristics and growth dynamics and they do not necessarily reap the full benefits of their specialisation in mining and resources. The OECD has established a project – OECD Mining Regions and Cities – to identify leading practices and recommendations to implement better regional development policies for these regions.

What are the project objectives and what are the main outcomes so far?

In early 2017, the OECD began work with the region of Antofagasta, the Chilean Government, and private sector stakeholders to hold the first OECD Meeting of Mining Regions and Cities. It provided the basis for agreement on three objectives for future global co-operation supported by the OECD on this topic:

1. Develop evidence with guidance and tools for regional development in a mining and resources context for industry, national and sub-national governments, and non-government organisations to cooperate on addressing shared challenges.

2. Produce a series of regional case studies that deliver specific recommendations and support to implement better regional development policies.

3. Develop a global platform for mining regions and cities through events and peer-review that enable knowledge sharing, advocacy and dialogue between public/private sectors and local communities on better policies to enhance regional productivity and wellbeing.

The main outcomes from the initiative so far are:

• Development of a framework to guide comparative analysis and benchmarking of mining regions and cities.

• Building a global evidence base and developing recommendations for mining regions through two case studies that have commenced for Outukumpu, North Karelia, Finland and Vasterbotten and Norrbotten, Sweden.

• Stronger networks and opportunities for knowledge-sharing through two events have been held in Antofagasta, Chile (October 2017) and Darwin, Australia (November 2018) - these events were attended by a total of 430 people from across 14 countries.

Do you plan to create a permanent network of Mining Regions & Cities? If so, who is going to fund this network?

At this stage, the aim is to work toward developing some OECD guidance to implement better regional development policies for regions with a specialisation in mining and extractive industries and release this guidance in 2021. The events, case studies and thematic analysis will build the evidence and support to make this possible. The future form of global co-operation on this topic would need to be agreed to with stakeholders and approved through relevant OECD bodies. The continuity of this work depends upon voluntary contributions to the OECD.

What do you think are the greatest future challenges and opportunities facing the mining regions and cities?

It is difficult to have a coherent and definitive view about this across all OECD member countries, and the project will allow us to form a collective position on it. However, the work so far has points to a number of key challenges and opportunities:

• The transition to a low carbon economy – this will generate both opportunities (e.g. demand for minerals and metals related to renewable energy) and challenges related to adjustment costs, especially for regions dependent upon coal and oil extraction. This is perhaps the most important issue of all and how we manage the distributional impacts within countries is likely to play a key role in ensuring we can deliver on this transition.

• Increasing digitalisation and automation – this will create new high wage jobs but may also lead to less direct employment in mining operations, which potentially could negatively impact producing regions. Regions need to be prepared for this shift through proactive approaches to skills development and support for small business.

• Building understanding about the role of mining and extractive industries in society – minerals, metals and energy resources provide the basis for many of the things we all take for granted; however, awareness about this outside of producing regions and the industry is low. This is a risk in terms of future support for the mining and extractives industry.

• Future of globalisation and global value chains – there is a body of evidence pointing to a slowing down of globalisation, which may lead to the regionalisation of supply chains. Coupled with geopolitical tensions this may change the nature of trade in raw materials. Greater emphasis may be placed upon security of supply, and the impacts of this are uncertain.

• Addressing the impacts of population ageing – the extraction of minerals, metals and hydrocarbons usually occurs in low density economies with further distance to major metropolitan centres. These are also the regions most likely to have older populations and a shrinking workforce. The challenge here is to look at ways to improve the attractiveness of mining cities and towns and developing training and employment pathways for local people.

How do you see MIREU’s position in the OECD’s plans? Are there any overlaps in work and how could they be avoided?

MIREU is a key partner for us. We share similar objectives and two-thirds of OECD members are part of the EU. MIREU can support the OECD in developing a global view about topics such as smart specialisation in a mining context, land use planning, and smart and green mining.  The OECD can add value to the work of MIREU by:

• Linking it to a global network and providing additional opportunities for knowledge sharing and peer review;

• Raising the visibility of challenges and opportunities facing mining regions;

• Developing internationally comparable data;

• Providing an objective assessment of policies.

We are partnering with MIREU for the pre-conference workshop at our next event in Skellefteå, Sweden. This pre-conference workshop will provide an opportunity to develop some agreed indicators and identify leading practices to improve quality of life in mining regions. This includes topics such as skills, housing, public services, community infrastructure and environmental issues. We have committed to including MIREU in the ongoing dialogue about the future of this OECD work.