19th Annual General Meeting of the Intergovernmental Forum on Mining and Sustainable Development (Opening session)

Sharing mining benefits in the energy transition

Excellencies,

Distinguished delegates,

Ladies and gentlemen,

The 19th Annual General Meeting of this Intergovernmental Forum has chosen a very timely theme: “Sharing mining benefits in the energy transition”.

The energy transition has moved to the top of the agenda of governments, international fora and businesses.

And better sharing of benefits in commodity value chains remains a top priority for many developing countries as they often retain only a small fraction of the benefits of commodity value chains.

This is no different for the final products associated with the energy transition – goods like batteries.

Mineral-producing developing countries tend to be stuck at the upstream segment of the value chains, generally only providing the raw materials that are then refined and processed elsewhere.

This has made these countries commodity dependent. In 29 developing countries, mineral extraction constitutes more than 60 per cent of their exports.

These patterns also expose them to the vagaries of commodity price volatility.

The priority of mineral producing countries is thus to add value to the minerals domestically.

This will boost their tax revenues, create more high-quality jobs, and enhance their capacity to attract Foreign Direct Investment into national economies.

And opportunities are expanding as demand for minerals critical for the energy transition is growing rapidly.

For example, the value of lithium imported by consuming countries grew from 4.9 billion US dollars in 2018, to 26.2 billion US dollars in 2022. The increase was driven by a price spike in 2022 as well as 150 per cent increase in volume of such imports.

Yet, the benefits are not automatic, they require concerted efforts, such as:

• Expanding exploration to collect more data on reserves and their economic potential to assess available opportunities.
• Enhancing transparency of minerals trade.
• Strengthening the capacity of public institutions to monitor and assess mineral taxation.
• Ensuring that taxation accounts for price volatility associated with minerals as well as the lifecycle of mineral extraction operations and
• Building local refining capacity and downstream value addition through domestic and foreign direct investment.

This is a big agenda and requires holistic national policies and strategy.

Such strategy also needs to be environmentally and socially consensual, to protect the interests of future generations and of different stakeholders in producing countries.

And it must be part of a wider strategy to boost diversification and structural transformation of the economy, which will require investments into education, training, infrastructure development, and technology.

Dear friends,

UNCTAD will continue providing research, platforms for dialogues and technical cooperation for enabling the energy transition.

We are working with many partners towards stronger, fairer, and more sustainable mineral value chains.

For example, we are working with other UN entities to provide an interface between mining countries and importers of minerals to ensure that stakeholders share fairly the benefits produced along mineral value chains, while also increasing the security of the supply of minerals and acting responsibly towards the environment.

This meeting is part of our commitment.

I wish you a productive and fruitful meeting.