Gold Mining Contributes More than US$171 Billion to Global Economy
According to the World Gold Council, the gold mining industry has contributed billions to the global economy in recent years
A new report from the World Gold Council in association with Maxwell Stamp, a leading international economics consultancy, reveals that the gold mining industry directly contributed approximately US$83.1 billion to the global economy in 2013. Once the indirect economic impact is taken into account, this figure increases to US$171.6 billion.
The social and economic impacts of gold mining report builds on previous research, including studies by the World Gold Council, to provide an understanding of the socio-economic impacts of the commercial gold mining industry at both a global, national and host community level.
The report’s analysis of the impacts of large-scale commercial gold mining in 47 gold-producing countries (accounting for over 90 percent of the world's gold production) shows that gold mining companies in total contributed over US$171 billion to the global economy in 2013 when the value created by support services and indirect employment is taken into consideration.
Globally, gold mining companies directly employed more than one million people in 2013, with more than three million more people employed as a result of the industry's suppliers and support services.
The report shows that gold mining has made good progress in seeking to develop local human capital and skills. In most gold producing countries, over 90 percent of the industry's employees are local workers. Although gold mining jobs are not as numerous as jobs in other industries, they are of high value as they consistently pay above-average wages – significantly above-average in less developed countries where each worker typically supports a high number of dependants.
Commenting on the launch of the report, John Mulligan, Head of Member and Investor Relations at the World Gold Council, said: “This report shows that the total economic impact of gold mining is significant and substantial; at US$171.6 billion, it is greater than the GDP of over 150 different countries and considerably larger than the total value of global overseas aid in recent years. Our findings highlight that commercial gold mining is a major source of income and driver of economic growth, playing an important role in supporting the sustainable socio-economic development of host nations and communities.”
More than half of the countries covered in the report are low or lower-middle income with substantial socio-economic development needs. However, the report indicates that growth in the economic contribution of gold mining often coincides with a marked improvement in income status of host nations.
Just under three quarters of the value that gold mining companies distribute within an economy relates to payments to local suppliers and employees. Interestingly, the majority of government revenues from gold mining are derived from sources, such as corporate and income tax rather than from money relating to permits and royalties.
The social and economic impacts of gold mining also shows that gold mining's direct economic contribution to the global economy has increased seven-fold from 2000 to 2013; greater than the rise in value of gold over the same period.
Andrew Britton, of Maxwell Stamp, who authored the report, added: “While there has been major progress in recent years in attempting to measure gold mining's economic impacts, this has often been piecemeal or confined to a specific country. The lack of information has held back constructive debate on how to make the most of the shared value that a responsible gold mining industry can create for host nations and communities.
“By building on previous research and identifying industry-wide thematic trends, this work has made substantial progress in bridging the information gap. We hope it will help foster productive engagement between gold mining companies and the industry's wider stakeholders.”
The social and economic impacts of gold mining report can be viewed here