A risky business: Mining, rent and the neoliberalization of “risk”

Abstract

Natural resource investment in the mining sector is often mediated through conflicts over rent distribution between corporate capital and landowner states. Recent rounds of neoliberal policy promoted by the World Bank have highlighted the need for landowner states to offer incentives in order to attract “high risk” capital investment. In Sub-Saharan Africa, in particular, countries have been pushed to offer attractive fiscal terms to capital, thereby lowering the proportion traditionally called rent. This paper examines how the concept of “risk” has been mobilized to legitimate such skewed distributional arrangements. While certain conceptions of social and ecological “risk” have been prevalent in political and social theoretic discourse on mining, such focus elides the overwhelming contemporary power of our notion of “neoliberal risk” – or the financial/market risks – in actually setting the distributional terms of mineral investment. We illustrate our argument by examining the nexus of World Bank mining policy promotion and Tanzanian policy in the late 1990s meant to attract foreign direct investment in gold production. In closing, we suggest that just as “risk” is used to legitimate attractive fiscal terms for investment, recent events highlight how skewed distribution of benefits may set into motion risks that corporate capital had not bargained for.