New economy supported by the old

With wonder one watches the volatility in global stock markets and the preoccupation of the news media with the “new global economy.” The myopic focus on telecommunications, e-commerce, genetic engineering, and the other fashionable industries that are supposed to dominate the foreseeable future leads me to ask if people are part of the equation anymore.

Somehow, the connection between the requirements for a person’s daily existence (“the bricks”) and the drivers of the new economy (“the clicks”) has come undone. This has occurred not only in First World countries but also in parts of the globe where social and economic underpinnings are wobbly. Consider, for example, the drive for an eco-tourism economic base in parts of Africa or Latin America where, in many cases, the agricultural and housing infrastructures necessary to feed and shelter the population remain underdeveloped.

The promoters of so-called “clean industries” (and the news media that give them air time) have forgotten that the materials for necessities such as roads, houses, vehicles, electric power grids and the like need to be made by someone out of something. Even those citizens who live on the Internet and cell phones rely on the supply of mineral resources to make their lives comfortable. Mineral products are key components in the manufacturing of the gadgets they love to use. Discussions on the merits of the new economy versus the old economy have missed one crucial point: the former can only exist alongside the latter, and does not replace it.

Each economic revolution undergoes a bumpy transition, but one that leads to improved productivity and redefines the quality of life. The Industrial Revolution of the mid-19th century transformed the world, and our high-tech age is transforming it again.

The pendulum always swings back. Sooner or later (perhaps after shortages of supply), the gurus of the new age and their media mouthpieces will remember that people, countries and economies need minerals and mineral products. Undoubtedly, with technological advancements, the extraction and processing of these minerals will be more efficient, cleaner and less obtrusive to the landscape.

The minerals industry is also undergoing change, and it is painful for many to participate in this shift. As an industry, we must continue researching and developing new and improved ways to explore for and mine mineral deposits. Only then can we change current perceptions shared by the media, environmental grandstanders and the public that mining somehow diminishes the quality of life.

We need to illustrate clearly that the quality of living these groups desire is not attainable without mining.

Mining and the lifestyles it supports will be an integral part of the new economy in the 21st century. It is essential that we communicate that the extractive industries are part of the foundation for this new economy. It is our obligation and privilege to do so.

— The author is vice-president of exploration for Kinross Gold.