Shared†use mining infrastructure: Why it matters and how to achieve it

Paul Collier and Glen Ireland

Development Policy Review, 2018, vol. 36, issue 1, 51-68

Abstract: This article considers the cases for and against ‘open access’ regulation of rail and port logistics infrastructure used by ‘bulk’ mining operations, arguing that host governments should proactively impose and then enforce such regulation in almost all cases. The logistics infrastructure needed for this type of mining activity is of critical importance. The costs and potential inefficiencies involved in duplicating such infrastructure confer a significant competitive advantage on its owner in the absence of effective access regulation. In particular, where a first mover develops an ‘integrated’ project incorporating a mine and associated infrastructure, a failure to impose access regulation discourages third†party investment in mineral exploration and development in the region serviced by the infrastructure, due to the risk of hold†up by the first mover. An unregulated first mover can also use its infrastructure advantage to capture the state's share of resource rents from the mineral endowment of the region. Open access regulation further benefits host countries by enabling broad†based economic development through the shared†use of mining infrastructure with other sectors (e.g., agribusiness). The article highlights contrasting experience with access regulation in Australia: the Pilbara iron ore region has seen protracted disputes involving mining firms and policy†makers and very few examples of third†party access, while in the coal region of central Queensland an extensive multi†user, multi†purpose railway network operates independently of mining firms. The authors urge governments in sub†Saharan Africa (in particular) not to underestimate the internal capacity and other challenges associated with developing and enforcing open access regulation of mining infrastructure in a manner that protects their national interests.

Date: 2018
References: View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
https://doi.org/10.1111/dpr.12231

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:devpol:v:36:y:2018:i:1:p:51-68

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0950-6764

Access Statistics for this article

Development Policy Review is currently edited by David Booth

More articles in Development Policy Review from Overseas Development Institute Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().