The superiority of systems based on private minerals ownership is evidenced by the common thread in legislative reform worldwide which has improved security of tenure and tradability of minerals and mining concessions.
The most successful reform initiatives occurred in Latin America where concessions granted by the state are now treated as real rights in property that are transferable, saleable, and can be mortgaged. As a result, the market, not the government, determines who will own particular mineral rights. This has led to the development of a secondary market for exploration and mining rights.
Following reforms during the 1990s, Latin America has attracted mining investment at the expense of the traditional mining countries such as South Africa. Latin America accounted for approximately 29% of worldwide investment in minerals exploration in 1999, as opposed to 13% in the 1980s.
Countries that attract most of the foreign investment and development of mineral resources are those in which mineral agreements and mining concessions and licences afford a large degree of security of tenure.
Surveys of trans-national mining companies by the United Nations and the World Bank clearly established that security of tenure (ownership) of rights to explore and mine is the major consideration driving investment.
Private ownership of mineral rights achieves all goals for minerals and mining development, without government bureaucracy, interference, inefficiency and corruption. Instead of nationalising mineral rights, South Africa should retain its private minerals ownership system.
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