Mining and minerals have had limited educational benefits

The story of mineral discoveries and mining in Africa being a social curse for the continent is likely to persist after researchers at the International Monetary Fund (IMF) and the World Bank recently found no conclusive evidence of intergenerational mobility into higher education in most African countries and districts where extractions of mineral resources occur.

Dr Jean-Marc Atsebi, an economist at the IMF’s fiscal affairs department, and Dr Rasmane Ouedraogo, the IMF resident representative for Niger, as well as Regina Stephanie Seri, a PhD candidate at the Université Clermont Auvergne – CERDI (University of Clermont-Auvergne) in France, and a research fellow at the World Bank, arrived at this conclusion after linking parents to the educational level of children involving about 14 million individuals across 28 African countries.

In an IMF working paper, ‘Is Education Neglected in Natural Resources-Rich Countries? An Intergenerational Approach in Africa’, the three researchers noted that mineral discoveries and production processes only positively affect educational intergenerational mobility for primary education in Africa and not higher education.

Taking into account that intergenerational mobility measures the levels of children’s education relative to that of their parents, in this case, researchers evaluated the effects of mineral activities on education for individuals born before and those born after the discoveries and the beginning of mining production.

“Our results show that mining activities positively affect primary educational intergenerational mobility for all age groups, but the effects are non-significant for secondary and tertiary education,” stated the study that was published earlier this year.

A focus on 28 countries

But the main issue is that, whereas Africa’s university education gross enrolment ratio has increased more than six times, from 1.4% to 9.4% between 1970 and now, mineral production appears to have contributed little, although it had a significant effect on primary education.

However, the mixed results are still troubling, considering that Africa has 30% of the world’s mineral resources, 40% of the world’s gold and up to 90% of some minerals such as platinum and chromium. According to the IMF, the mining sector accounts for about 10% of the gross domestic product of Sub-Saharan Africa and more than 50% of its total exports.

But, citing other researchers, Atsebi and his associates noted that there had been a weak link between oil, gas and diamonds extraction and tertiary intergenerational mobility in Africa, usually among persons exposed to the mineral sites and living in districts where such discoveries were made.

It is against that background that the three researchers decided to investigate the potential effects of mineral discoveries and production on educational intergenerational mobility in 28 countries, including Benin, Botswana, Burkina Faso, Cameroon, Egypt, Ethiopia, Ghana, Guinea, Kenya, Lesotho, Liberia, Malawi, Mali and Mauritius.

Other countries in the list included Morocco, Mozambique, Nigeria, Rwanda, Senegal, Sierra Leone, South Africa, South Sudan, Sudan, Tanzania, Togo, Uganda, Zambia and Zimbabwe.

Child labour

According to Atsebi and his associates, the study analysed academic intergenerational mobility in 2,890 districts, or administrative areas in the 28 countries.

“Our results showed that the effects of mineral resource discoveries and productions on the probability of upward or downward of tertiary educational intergenerational mobility were not statistically significant,” stated the study.

But, whereas on average, mineral discoveries and production have led to improvements of basic education and intergenerational mobility at local levels on the continent, the researchers concluded that, probably, many adolescents in mining areas were largely making trade-off choices between education and employment, with many of them taking jobs early in the mining sector.

Highlighting the issue, Atsebi and his associate researchers quoted a study, ‘Gold Mining and Education: A long-run resource curse in Africa?’ by Pelle Ahlerup, an associate professor of economics at the University of Gothenburg in Sweden, that argued that individuals in most African countries that had gold mines within their district when they were in adolescence have lower education attainment as adults.

In his view, the lower academic attainment in gold-mining districts in most African countries was because of a higher incidence of child labour.

“The ability to profitably extract gold in small-scale operations implies that children and young adults can easily find employment in gold mining,” stated Ahlerup in his study.

But, according to the IMF paper, the dynamic effects of mineral production on tertiary intergenerational mobility are more complicated and could be not attributed to just one factor as the new opportunities arising from mining might change economic prospects at the local level.

The less weight of the effects of mining activities on tertiary intergenerational mobility, the IMF researchers argued, could be due to the presence of mixed effects, both positive and negative, that are offsetting each other that could even include myopic personal educational decisions.

Economic shocks’ ripple effect

In this context, Mark Gradstein, a professor of economics at Ben-Gurion University in Israel, and Dr Phoebe Ishak, a post-doctoral researcher at Aix-Marseille University in France, in a study, ‘We Don’t Need No Education: The effect of natural resource income shocks on human capital’, argued that evidence pertaining to the effect of natural resource wealth on human capital in Africa is contradictory.

“In particular, one of our main findings, that oil price shocks in Africa are detrimental for schooling when experienced in adolescence, remains highly significant,” said Gradstein and Ishak in their study.

Even then, whereas, on average, mining activities were found not to be statistically significant in Africa towards increasing tertiary intergenerational mobility, Atsebi and his associates argued that there is chance that all is not lost and subsequently made some policy recommendations.

According to the IMF, minerals are resources that could be used to improve social and educational intergenerational mobility at all levels in Africa by creating job opportunities as well as raising returns to education, especially in areas where those resources are found and extracted.

Further analysis by the IMF showed that mining activities in some districts in South Africa had a higher probability of increasing educational intergenerational mobility at all levels.

But, for mining activities in Africa to be translated from being a curse to a blessing, Atsebi and his associates recommended that governments enact policies that will support enterprise development and creation of jobs.

Such policies, the researchers said, can include labour market flexibility and establishment of business linkages between large mining companies and small and medium enterprises, or SMEs, that would strengthen the sector’s capacity to create high-skilled jobs.

The researchers explained that there should also be targeted policies aimed at reducing the inequality of opportunities, as currently most mineral discoveries benefit males.

Towards promoting intergenerational mobility in higher education, the study noted that mining revenue funds should be established to assist tertiary institutions, not just in districts where there are mineral discoveries, but across the country in order to reduce regional disparities.

The current IMF working paper, which is the first of its kind to look into how mineral discoveries and mining specifically impact on intergenerational education mobility in Africa, appears to point out that many people are not benefiting properly from mineral extraction.

Although the results of the study are somehow mixed and inconclusive, the question remains as to who have been the beneficiaries of Africa’s large mineral deposits if they are not helping to improve social and intergenerational higher education mobility of the people living in those areas.

The situation that mineral discoveries and production in 28 African countries positively impact on educational intergenerational mobility only for primary education for persons exposed to the mineral sites and living in districts with such natural resources is bad indeed.