With consumption of natural resources continuing to increase worldwide, resource-rich countries in Africa, Asia and Latin America are positioned to play an increasingly crucial role supplying the demand, and reaping increased revenues, for decades to come. This Guide presents a concise introduction to the different Latin American policy models applied to promote development in the oil, mining and gas sectors, while at the same time, laying the foundation for sustainable economic development. It outlines the results of different policy models, and underlines the importance of taking into account regional contexts, including cultural, environmental and political differences.
•The success of a particular investment model is strongly correlated to the type of extractive sector to which it is applied. In the mining sector, private investment has led development efforts, while in the hydrocarbon sector an investment model where the state is dominant, or at least present, has shown good results.
•Successful state participation in the extractive industries sector has resulted in institutional improvements, with state-owned enterprises playing a particularly important role in the production of hydrocarbons.
•Foreign direct investment (FDI) flows to extractive industries seem to change to reflect different tax and royalty schemes. In the mining sector in particular, some Latin American countries have succeeded in attracting foreign investment that complies with international social and environmental standards.
Damonte, G.; Glave, M. ELLA Guide: Maximising Investment and Rent Capture Through Extractive Industries Investment Policies: the Latin American Experience. ELLA, Practical Action Consulting, Lima, Peru (2012) 7 pp.