Who benefits from extractive industries?

Finding the exact names of the people who will benefit from an extractive industry on our lands is not simple.

In general, mining companies are intertwined in many geopolitical power games. We may be dealing with the state, a private company, or a private company financed by the state, banks, other companies, or even single (very rich) people.

TIPS

  • Make sure official negotiations follow the community’s traditional process, appeal to the right of free, prior and informed consent, and think of ways of blocking access to your territory.
  • Depending on the materials they are interested in, look up the major world companies that deal with those materials and see if some of the shareholders match the company that approached you. If so, the money will go straight up to them.
  • Connect with neighbors and see if they have also been contacted and at on what terms.

So how to know who you are speaking with?

A single person or a small team will usually contact us. These people may work for the actual company or an interface company (front company) made specifically for the occasion.

Why does this happen? If there are problems, having an interface company in place acts as a buffer for the actual company and makes it harder for us to harm the company’s reputation or hold it accountable.

So, where does the money go?

No matter how much a company offers us, most of the profits will not stay in our community but will go into the company (and its board members!). Other beneficiaries may be investors, fellow companies, international institutions, and lobbyists.

It’s important to note that the people who use the products produced from the extracted raw materials will pay money to use them, so neither are they the biggest beneficiaries of this production chain. In fact, sometimes you may find consumers are allies. For example, the Right to Repair consumerist movement is currently fighting battles that could positively influence how industries consume natural resources.

And what about organized crime?

It may be because a company encourages violence, because the state supports it, or because other communities prioritize their interests; still, organized crime and violence connected to extractive industries will increase wherever extraction happens.

Watch this interview of Dr. Ryser to learn more about it.