Communities matter to natural resources development

Extractive industries that can meet the needs of resource-hungry export markets typically receive disproportionate attention as developing states become greater players in international economic systems. While such industries provide a potentially strong source of capital, they bring about a litany of possible social and environmental costs, many of which play out at community levels. Around the world, cases have been documented in which the absence of a meaningful community engagement strategy has affected the viability of a natural resource exploitation project. Particularly in underdeveloped areas where there are poor, deprived or marginalized communities, investors run the risk of becoming entangled in problematic business-community relationships.

Community-level engagement is essential for responsible resource development.

Communities near natural resources stocks face several constraints in managing the impact of large extractive projects. Among the most prevalent are the capacities of the communities and local governments to ensure sustainable practices, resolve conflicts and promote economic gains for their people.

Clear values are thus needed to guide community engagement strategies on resource development. First, greater participation of the people in decision-making and resource management should be built into the project. Accountability and transparency mechanisms will help communities ensure fiscal revenues are managed and invested effectively. Environmental protection policies can ensure the ecosystems surrounding communities are not unduly damaged. These principles focus on processes rather than outcomes, ensuring that stakeholders are engaged and have ownership over the direction of processes that affect them.

Newly engaged stakeholders will neither replace experts nor marginalize other stakeholders, but will rather be called upon to make honest contributions, influence decisions and see their inputs in the decisions made. Furthermore, it is necessary to recognize structural constraints by engaging those marginalized within communities as well, such as women and young people. Such inclusive approaches can mitigate and pre-empt grievances within local communities over resource extraction policies and perceptions of inadequate transparency and accountability.

This week at the World Economic Forum on East Asia in Nay Pyi Taw, leaders will meet to consider the role of natural resources in Myanmar’s development. Introducing principles that will help Myanmar communities manage the impact of natural resources extraction is a crucial step for promoting local development and making business environments safer.

Community engagement is one element of responsible natural resources management explored by the Global Agenda Council publication Natural Riches? Perspectives on Responsible Natural Resources Management in Conflict-Affected Countries

Author: Mely Caballero-Anthony is Head and Associate Professor at Nanyang Technological University; she is also a member of the Global Agenda Council on Conflict Prevention

Image: A man collects salt from fields in Myanmar REUTERS/Soe Zeya Tun