Sustainable Development and Nonrenewable Resources

Introduction

The link between sustainable development and nonre-

newable resources appears at first glance to be inconsistent,

because nonrenewable resources are finite. The concept of

sustainable development has generated a great deal of debate

and spawned a multitude of definitions since it was put for-

ward by Malthus (1798) about 200 years ago. He argued that

the fixed land base could not sustain the continuing growth in

human population and, if people did not restrain their repro-

duction, the population would be controlled by war, pesti-

lence, and starvation. This early thinking evolved to what we

now accept as the fundamental premise of sustainable devel-

opment as stated by the World Commission on Environment

and Development (Brundtland, 1987, p. 8)—“development

that meets the needs of the present without compromising the

ability of future generations to meet their own needs.” The

United Nations Development Programme (UNDP) believes

that development must have a human face and coined the

term “sustainable human development.” Its mission, there-

fore, is to help countries in their efforts to achieve sustain-

able human development by assisting them to build their

capacity to design and carry out development programs in

poverty eradication, employment creation and sustainable

livelihoods, the empowerment of women, and the protection

and regeneration of the environment, giving first priority to

poverty eradication.

The idea of sustainable development in the context of

nonrenewable resources, in particular mineral resources, may

seem a contradiction if a one-dimensional view is taken. Min-

eral resource development is unsustainable only if we ignore

the complex interaction of economic growth, social develop-

ment, and the environment. It is not always self-evident that

our present modern technological society requires an ongo-

ing supply of minerals. Mineral production, although having

environmental impacts, is and will continue to be an essential

part of ensuring the economic well-being of our society. To

satisfy the present global mineral needs without compromis-

ing the mineral resource needs of future generations, it is

imperative that we approach mineral resource development

within a holistic framework comprising all components of

the complex interaction between humans and the ecosystem

on which they depend. By using nonrenewable resources for

capital formation that will be reinvested in social, economic,

and environmental activities, the concept of sustainability and

mineral resource development would no longer seem to be a

contradiction.

Since the establishment of the UNDP in 1965, the organi-

zation has supported mineral resources development activities,

including exploration, feasibility studies, capacity building, and

institutional strengthening of mining departments in develop-

ing countries. As a result of these activities, several important

mineral deposits were discovered, including one of its earliest

and largest discoveries, the Baja la Alumbrera copper deposit

in Argentina. Today, UNDP’s direct involvement in the min-

eral sector is minimal, mainly because it is felt that this activ-

ity should be left to the private sector. However, the wealth of

information that resides within UNDP archives could contribute

to the global assessment of future sources of mineral supplies. A

global mineral resource assessment is seen as a prerequisite to

adequate planning for the sustainable use of these nonrenewable

resources and as a contribution to the achievement of UNDP’s

overarching goal of poverty eradication.

This paper discusses the evolution of the concept of

sustainable development and the need to treat mineral resource

development as one component in a complex interaction

between humans and their environment. UNDP’s approach

and contribution to fostering an enabling environment for

global mineral resource development within the framework of

sustainable human development are presented.

Sustainable Development

Evolution of the Concept

The concept of sustainable development can be traced

back to the 18th century, when there was concern that the

limited amount of land and resources would retard economic

growth. Tahvonen (2000) traced the development of economic

thought on sustainability and scarcity of natural resources by

citing four main periods, as follows.

Sustainable Development and Nonrenewable Resources—

A Multilateral Perspective

By George A. Nooten

Former Officer-in-Charge, United Nations Revolving Fund for Natural

Resources Exploration, New York, N.Y., U.S.A. (e-mail: vanooten@msn.com).

36 Proceedings, Workshop on Deposit Modeling, Mineral Resource Assessment, and Sustainable Development

The 1st period

1798 Thomas Malthus (1798) believed that the fixed

land base could not sustain the continuing

growth of human population. He predicted that,

if humankind did not make the moral decision

to control the increasing number of people on

the planet, populations would be held in check

by war, pestilence, or starvation.

1862 John Stuart Mill (1862) emphasized that, while

the limited amount of natural resources could in

principle constrain increases in production, this

limit would not be reached in any country over

any meaningful timeframe.

The 2d period

1890–1920 The U.S. conservation movement in its doctrine

stated that economic growth has clear physical

boundaries that cannot be avoided by technological

development. Too rapid use of nonrenewable

resources was considered a major threat to future

generations. It was argued that, the lower the use of

nonrenewable resources, the better.

1931 Studies by Hotelling (1931) proposed a

theoretical model in which social well-being

from nonrenewable resources was maximized

over an infinitely long time period.

1963 Barnett and Morse (1963) questioned the

pessimistic Malthusian view and the basic

premises of the conservation movement. They

found that, on the basis of price and cost time

series data on minerals, agriculture, and renewable

resources, (1) the price and production costs had

fallen or remained constant during the period

1870–1957 and (2) only the price level of forestry

had shown an upward trend. These findings

were explained by technological development,

which produced substitutes for scarce resources,

decreased extraction costs of minerals, and

expanded the size of economic reserves.

The 3d period

1972 The “Limits to Growth” report for the Club of

Rome by Meadows and others (1972), using

the modeling method called “systems analysis,”

predicted that the future world population level,

food production, and industrialization would first

grow exponentially but then collapse during the

next century. The collapse would occur because

the world economy would reach its physical

limits in terms of nonrenewable resources,

agricultural production, and excessive pollution.

The study predicted that 11 vital minerals could

be exhausted before the end of 2000.

1977 Wassily Leontief and others (1977), on

request by the United Nations, applied equally

pessimistic assumptions as the “Limits to

Growth” report, except that they took into

account that demand may respond to higher

prices. Their results showed that only two

minerals were in danger of being exhausted.

The 4th period

After 1974 Presustainability from 1974 onward.—Two

economists, Partha Dasgupta and Geoffrey

Heal (1974), asked whether an economy can

maintain a positive consumption level forever,

given that there is no technical development

and that the production of commodities is

possible only by using limited nonrenewable

resources like oil. Their analysis revealed that it

is possible to maintain a positive consumption

level only if capital can be substituted for

nonrenewable resources without technical

difficulties.

The concept of sustainable development has evolved

and gained global recognition since the report by the World

Commission on Environment and Development (Brundtland,

1987) and the United Nations Conference on Environment

and Development in 1992. The concept is complex, requiring

a delicate balance among economic growth, environmental

protection, and social development to secure the well-being of

the increasing population on a sustainable basis.

Defining Sustainable Development

The complexity of sustainable development has spawned

a myriad of definitions. The most quoted definition is by the

World Commission on Environment and Development (Brundt-

land, 1987, p. 8), which says that sustainable development

is “development that meets the needs of the present without

compromising the ability of future generations to meet their

own needs.” The concept is further elaborated therein by the

statement, “In essence, sustainable development is a process of

change in which the exploitation of resources, the direction of

investments, the orientation of technological development, and

institutional change are all in harmony and enhance both current

and future potential to meet human needs and aspirations.”

In 1991, “Caring for the Earth—A Strategy for Sustain-

able Living,” published by the International Union for Con-

servation of Nature and Natural Resources, United Nations

Environment Programme, and World Wide Fund for Nature

(Munro and Holdgate, 1991), defined sustainable development

as, “improving the quality of human life while living within

the carrying capacity of supporting ecosystems.” The Austra-

lia Ecologically Sustainable Development Working Group on

Mining (1991) defined sustainable development as, “ensuring

that the mineral raw materials needs of society are met, with-

out compromising the ability either of future societies to meet

their needs, or of the natural environment to sustain indefi-

nitely the quality of environmental services (such as climate

systems), biological diversity, and ecological integrity.”

UNDP advocates sustainable human development, which

is an approach that seeks to expand choices for all people—

women, men and children, current and future generations—

while protecting the natural systems on which all life depends.

Moving away from a narrow, economy-centered approach to

development, sustainable human development places people

at the core and views humans as both a means and an end of

development. Thus, sustainable human development aims

to eliminate poverty, promote human dignity and rights, and

provide equitable opportunities for all.

In addition to the several definitions of sustainable devel-

opment, the concept is elaborated in principles 1, 4, 5, and 8 of

the Rio Declaration (United Nations, 1992), as follows:

Principle 1. Human beings are at the center of concerns for

sustainable development. They are entitled to

a healthy and productive life in harmony with

nature.

Principle 4. In order to achieve sustainable development,

environmental protection shall constitute an

integral part of the development process and

cannot be considered in isolation from it.

Principle 5. All States and all people shall cooperate in

the essential task of eradicating poverty as

an indispensable requirement for sustainable

development, in order to decrease the

disparities in standards of living and better

meet the needs of the majority of the people of

the world.

Principle 8. To achieve sustainable development and a

higher quality of life for all people, States

should reduce and eliminate unsustainable

patterns of production and consumption and

promote appropriate demographic policies.

Although several definitions exist, the three main ele-

ments—economic growth, social responsibility, and envi-

ronment and natural resource conservation—are persistent

in the definitions of sustainable development. There is an

unquestionable global acceptance of the need for all nations

to embrace the concept of sustainable development, which

upholds the universal values of fulfilling basic needs and

access to good health, wealth, dignity, knowledge, justice,

equity, and peace.

Nonrenewable Resources

At first glance, a nonrenewable resource seems to be

incompatible with sustainable development. This is true

because the concept of a nonrenewable resource implies

that, once a resource is used, since it cannot reproduce itself,

sustainability is not possible. This one-dimensional view of

nonrenewable resources seems to support the widely held

view that the extractive industries cannot be supportive of the

concept of sustainable development. A closer examination of

the issue, however, reveals a different perspective.

Nonrenewable resources, in particular mineral resources,

are necessary for the economic well-being of our societies.

It is not always self-evident that without a supply of mineral

products our living standards will be drastically reduced and

the impact on the global economy will be disastrous. The

modern conveniences, such as automobiles, building and trans-

portation infrastructure, fertilizers for increased food produc-

tion, television sets, computers, solar panels, aircraft, medical

diagnostic and treatment methods and instruments, farming

equipment, and cooking utensils, require mineral products.

It is a truism that what is not grown must be mined. To have

access to mineral resources, their extraction from the Earth

and the environmental impacts associated with this activity are

unavoidable.

In limiting the concept of nonrenewability to exhaustion

and depletion in the case of mineral resources, we are ignoring

the impact of technology. Advances in technology, new min-

eral discoveries, and limits on the material riches desired by

our societies can minimize the possibility for exhaustion and

depletion of the Earth’s recoverable mineral supply. Technol-

ogy provides the possibility of finding ways to renew the sup-

ply of minerals through advances in exploration techniques,

extraction processes, recycling, and substitution. In the case of

some resources we think of as renewable, such as biological

resources, the reality is that some bird and fish species have

become extinct and, therefore, also can be considered nonre-

newable. In viewing mineral resource depletion at the scale of

individual mine sites, the limited perspective of nonrenewabil-

ity can apply; on a global scale, however, given the untapped

resources of the oceans and deeper parts of the Earth’s crust,

we should consider a broader view of nonrenewability.

Given the important role that minerals play in our societ-

ies, it is necessary to view mineral development as one of the

important components of continuing economic growth without

impairing the capacity of future generations to enjoy the same

or a better standard of living. Sustainability requires economic

growth, environmental protection of our ecosystem, and social

responsibility. The dynamic interplay of these three compo-

nents is a prerequisite for achieving the goals of sustainability.

Mineral development can be viewed as supporting the concept

of sustainable development if the extraction of minerals takes

place in a manner that minimizes the environmental impacts;

equitably shares the benefits from the new wealth created;

utilizes the capital obtained to provide adequate healthcare,

education, and other social services; and reduces the level of

waste through recycling and improved technologies to opti-

mize recoveries.

In considering national and international mineral sup-

plies, it is necessary to recognize the dynamic characteristics

Sustainable Development and Nonrenewable Resources—A Multilateral Perspective 37

38 Proceedings, Workshop on Deposit Modeling, Mineral Resource Assessment, and Sustainable Development

of the minerals industry and to take into account the other

factors apart from the economic and geologic ones. It is well

accepted that the environmental and sociocultural aspects must

be an integral part of the way the minerals industry operates.

Sustainability of Mineral Supply

Although some authors predicted that the world would run

out of some minerals, thus contributing to constrained economic

growth, this pessimistic prediction has failed to materialize

despite increasing consumption and population growth. The

main reason for this failure was that projections of supply and

demand models failed to take into account the dynamic nature

of the minerals industry. Some minerals in use today were not

in use 50 years ago, while others have been substituted for by

plastics, composites, and other materials. For example, we are

seeing an increased use of optical fiber replacing copper in the

communications industry. It is possible that with new tech-

nologies the future uses of some minerals will require reduced

quantities of the mineral raw material to be mined.

Dzioubinski and Chipman (1999) presented an overview

of the trends in production and consumption of copper, lead,

and aluminum. They found that there will be no shortage of

copper due to depletion of ore in the foreseeable future. The

reserve base of copper will last for more than 40 years, and

copper resources for more than 105 years. For lead, the reserve

base is sufficient for 40 years, and identified resources for 500

years. For aluminum production, the primary raw material

is bauxite. Reserves of bauxite will last for about 100 years,

and estimated resources between 170 and 200 years. As can

be seen, there is no evidence that these or other nonrenew-

able resources will be scarce due to extraction and depletion

in the medium to long term. As technologies emerge for the

development of resource substitutes, recycling methods, and

improved exploration and mining methodologies, together

with the potential for discovery of minerals not yet known,

global mineral supply is in no danger of becoming scarce due

to depletion of mineral resources.

UNDP’s Contribution and Role

Mineral exploration activities in the developing world

have been supported by the United Nations (U.N.) and in

particular by the UNDP for more than 40 years. This support

was in recognition that the mineral wealth of a country was an

engine of economic growth. The U.N. programs covered many

aspects of mineral resource development in the developing

countries, including the following:

Institutional strengthening of geological surveys and min-

eral resource departments and ministries.

Training of nationals in all fields of mineral resources.

Mineral exploration using geochemical prospecting,

airborne and ground geophysics, analytical chemistry, and

assaying.

Drilling.

Economic feasibility studies.

Mining and mineral processing—establishing mining and

metallurgical institutes.

Mining legislation.

Exploration results have been positive in many of the

exploration programs undertaken by UNDP. The discovery

of the Cerro Petaquilla porphyry copper deposit in Panama

(1965–71) attracted international mining companies that began

exploration in Panama and neighboring countries for similar

deposits in the circumpacific orogenic belt in the Americas.

In Mexico, UNDP projects led to the discovery of La Cari-

dad porphyry copper deposit and the Las Truchas iron ore

deposit. In Asia, discoveries include the Mamut porphyry

copper deposit in Sabah, Malaysia; offshore tin in Indonesia;

and the Sar Chesmeh copper deposit in Iran. In Africa, several

deposits were found by UNDP mineral exploration programs;

notably, lateritic nickel in Burundi and Tanzania, iron ore in

Guinea, and gold in Burkina Faso.

Rapidly changing external and internal factors have

necessitated a change in focus of the activities of the UNDP.

Externally, there have been major global political changes

such as the breakup of the Soviet Union. Several armed

conflicts in the developing world have created a major refu-

gee crisis requiring the intervention of U.N. peacekeeping

teams. There have been important social changes, such as the

emergence of global movements regarding women and indig-

enous people and regarding environmental and human rights.

Internally, major reforms of the organization have taken place,

resulting in the reorientation of programs to respond to the

demands of these dramatic changes. The current development

approach embodies all the elements of sustainable develop-

ment, with a major focus on poverty elimination.

In response to the many changes, mineral exploration

activities by UNDP declined and were replaced by an empha-

sis on processing and manufacturing activities. Examples of

this new direction are (1) providing advice to governments in

reforming their mining codes and their fiscal regimes, (2) pro-

viding policy advice in environmental matters, (3) promoting

women’s issues, and (4) providing assistance in the transfor-

mation of informal small-scale mining to a formal sector.

The stated mission of UNDP is to contribute to halving

world poverty by 2015. To achieve this goal, the emphasis

is on pro-poor and sustainable growth. It is recognized that

sustained poverty reduction requires socially, politically, and

environmentally sustained economic growth in all countries.

The present activities in the natural resource sector focus on

poverty reduction strategies, and because the private sector

is better positioned to play a key role in the mineral sector,

UNDP now concentrates on issues pertaining to good gover-

nance, capacity building, and the strengthening of institutions.

In the natural resources management cluster, emphasis is

placed on water, sustainable agriculture and food security, and

renewable energy and energy policy.

Although UNDP no longer is directly involved in mineral

exploration activities, it continues to contribute to the mineral

sector through implementation of the sustainable livelihoods (SL)

approach to artisanal mining. As one of UNDP’s five corporate

mandates, SL offers both a conceptual and a programming frame-

work for poverty reduction in a sustainable manner. Conceptually,

livelihoods connote the means, activities, entitlements, and assets

by which people make a living. Assets, in this particular context,

are defined as not only natural or biological (that is, land, water,

minerals, common-property resources, flora, fauna) but also

social (that is, community, family, social networks, participation,

empowerment), human (that is, knowledge creation by skills),

and physical (that is, roads, markets, clinics, schools, bridges).

The sustainable livelihood approach could be instrumental in tap-

ping the vitality of mining to improve community livelihoods and

contribute to poverty eradication.

UNRFNRE’s Role in Sustainable

Development

In 1973, the U.N. Revolving Fund for Natural Resources

Exploration (UNRFNRE) was established to respond to fears

expressed about the future scarcity of mineral supply. The

revolving fund acted as a catalyst in mineral resource develop-

ment through its executing and financing mechanism, which

promoted self-reliance and cooperation among developing

countries. The creation of the fund was a cooperative attempt

by the world community to expand the inventory of mineral

resources at mankind’s disposal for the future. Voluntary con-

tributions made by donors both from developing and developed

countries provided the high-risk capital for mineral exploration

at no cost to the recipient governments. The only requirement

was that, in the event that the fund was successful in discovering

an economic mineral deposit that went into production, the gov-

ernment was obligated to make replenishment payments to the

fund. The replenishment rate was 2 percent (1 percent for least

developed countries) of the gross value of annual production

for a period of 15 years, with a ceiling of 10 times the amount

of the cost of exploration incurred by the fund. It was estimated

that, after 25 years, the fund would be self-sustaining and not

dependent on contributions from donors. The replenishment

payments would be the pool of high-risk capital for developing

countries to utilize for their mineral exploration activities. In this

way, countries would share the risk and be self-reliant in financ-

ing their mineral exploration activities.

During its 26 years of existence, UNRFNRE has assisted

developing countries to locate and define the economic min-

eral deposits within their borders. With a total expenditure

of nearly US$100 million, the fund has evaluated over 100

mineral prospects, carried out 34 mineral exploration projects,

and discovered 10 economic mineral deposits with an in-place

value of approximately US$3.4 billion. To date, deposits of

gold in Peru and Ecuador and chromite in the Philippines have

been mined. On August 3, 2000, one of the fund’s projects, the

Geita, Tanzania, gold mine, was officially opened; it will be

producing 500,000 ounces of gold annually from a reserve of

5 million ounces and a resource of 12 million ounces.

The changed focus of UNDP to concentrate on process-

ing and manufacturing activities, and the decision to phase out

the activities of the fund by the end of 2000, brings an end to

the mineral exploration activities within the UNDP. It is hoped

that the new wealth created by the fund’s discoveries will be

reinvested in social, economic, and environmental activities in

line with sustainable development objectives.

Conclusions

Nonrenewable resource development and sustainable

human development are inextricably linked, complemen-

tary, and multidimensional. Development is unsustainable if

equity does not exist or where large numbers of people live in

abject and degrading poverty. As a development organization,

UNDP supports the development of national capacity in the

participating countries through sustainable human develop-

ment activities. The approach is holistic and multidimensional,

recognizing the mutual dependency and complementary nature

of the social, economic, environmental, cultural, civil, and

political dimensions of development.

Although UNDP and UNRFNRE will no longer engage

directly in mineral exploration activities, contributions to the

mineral sector will continue through UNDP’s four main areas of

sustainable human development programming—(1) eliminating

poverty and implementing sustainable livelihoods, (2) promot-

ing the advancement of women, (3) protecting and regenerating

the environment, and (4) developing capacity for good gover-

nance. All of these areas have dimensions pivotal to the devel-

opment of nonrenewable resources in a sustainable manner.

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