Beyond Extraction

TechnoServe, Anglo American, and the Inter-American Development Bank are collaborating in a regional public-private partnership to catalyze locally adapted economic development for communities surrounding Anglo American’s mining operations in Brazil, Chile, and Peru.

Context

Mining companies play a critical role in helping drive economic growth, employment, and exports for a number of the emerging markets in which TechnoServe works. However, while these operations bring investment and jobs, these benefits are often not shared by all members of the community. Employment opportunities may not extend to all households. Local businesses may lack the skills, knowledge, and market access to take advantage of the opportunities provided by economic growth around the mining operation. And the subset of businesses that could potentially become direct suppliers to the mining operation often lack the training and support they need to integrate into formal supply chains.

Opportunity

While mining operations themselves cannot always provide equitable and sustainable growth across communities, they can serve as an economic catalyst for comprehensive local economic development, supporting enterprises and value chains – both within and beyond their own supply chains – to boost employment and incomes. By spurring the development of more prosperous local economies, mining companies also strengthen their license to operate within communities, local and national governments, and more sustainable and inclusive value chains.

Strategy

Building on their successful partnership strengthening communities’ economic development across five countries, Anglo American and TechnoServe worked with the Multilateral Investment Fund (MIF) – a member of the Inter-American Development Bank (IDB) Group – to bolster broad economic growth of mining communities through the Beyond Extraction program. Beyond Extraction used a market systems approach tailored to each country’s context, supporting local economic development by increasing the capacity of rural businesses, youth, and institutions to build more diversified, competitive, productive, and prosperous economies.

In Chile, the initiative focused on improving the job prospects and self-employment skills of young women and men, and on strengthening actors in the labor and self-employment market.

In Chile, the EmpleaT program worked since 2016 to strengthen the local workforce and increase employment opportunities around Anglo American’s operations in the Metropolitan and Valparaíso regions by training women and youth in the skills they need to acquire or create meaningful employment. In order to ensure that this burgeoning generation of entrepreneurs and workers were able to sustainably apply their new skills to a healthy job market, TechnoServe also built strategic public-private partnerships with corporations and government bodies enabling them to continue to train and provide employment for local women and youth beyond the project’s end, and to support them to become participants and leaders in their emerging economies. Over the course of four years, EmpleaT trained nearly 1,800 participants to improve their employability skills.

In Brazil, Beyond Extraction worked to build more robust local economies and reduce dependence on mining activity.

In Brazil, the Crescer program worked to diversify local economies in the area surrounding the Minas-Rio mine in Minas Gerais State. In these communities, lack of economic opportunity beyond the mining sector has driven youth to seek employment in urban areas, further diminishing prospects for rural economic growth. In order to help these communities reduce their dependence on mining activity, the program strengthened four local industries with growth potential – tourism, beekeeping, dairy, and horticulture. Beyond direct technical assistance for businesses within these industries, TechnoServe also improved the capacity of local institutions to support these sectors in the future, ensuring the scalability and sustainability of their growth after the projects’ end. An important aspect of the program was youth empowerment, which supported enterprising young people to build livelihoods within their rural communities and contribute to its sustained growth.

In Peru, TechnoServe teams helped businesses to capitalize on the market opportunities opened by increased mining activity, and to integrate into the supply chains of these operations.

The Emerge program focused on preparing small- and medium-sized enterprises to enter the mining sector’s supply chain, as well as to foster mining activities; potential to growth and benefit other industries – such as commerce, hotels, and restaurants. The project boosted the performance of entrepreneurs in these key sectors by providing group and one-on-one training in business management and financing, and by building partnerships with public and private organizations with the ability to support maintained growth throughout the market system.

Results

Over four years, the Beyond Extraction program supported 5,421 jobs, 19% of which were newly created positions. This impact has been distributed across geographies:

Emerge Peru supported 3,247 jobs and created 1,007 jobs;

EmpleaT trained nearly 1,800 participants to improve their employability skills;

Crescer supported four value chains, supported 743 jobs, and saw 275 workforce development graduates (60% women) with an average income increase of 76%.

Read more about the impact of this multi-year, cross-geography program.