Editorial: Against Extractive Industries


In a very real sense, the extractive industries represent the earliest phase of ‘global factory’, the beginning of the basic production circuit, and the foundation of the web of global production networks that form todays’ global economy. The extractive industries, the ‘holes maker in the ground’ as Peter Dicken put it correctly, become strategic sector that supply raw materials to many other industries. There is almost none of modern production disconnects from the extractive industries for raw materials.

The foundation of the extractive industries is a notion of ‘natural resources’. In fact, natural resources are not ‘naturally’ resources as it is both a socio-cultural and a political construction. The industry has been a political project that involved aggressive intervention of both transnational corporations and national governments by imposing vast range of regulation that serve their interest. There is no doubt that corporations and states exploit natural resources for capital accumulation.

Due to the operation of extractive industries, there have been massive environmental destructions, coercive displacement and dispossession of the indigenous people from their habitat. Many of these people have lost their lands, livelihood, and even their lives. Their habitat has been extinguished where their lives rely heavily on it. And there are more people who are in the verge of being displaced and dispossessed due to the industries’ aggressive exploitation.

The recent case of London-based global metals and mining giant, Vedanta Resources, shows that many of corporations in the industries have been the notorious examples in violating human rights, indigenous rights and environmental laws from the beginning of their operation. Mining companiesare vigorously anti-union in outlook and have a long history of victimising, sacking union activist, and even killing the people.  

Dedicated for those who have been the victims of this development, the current issue of Asian Labour Update presents the picture of extractive industries in Philippines, India, Indonesia, Malaysia and Australia. The issue is aimed to uncover the very ugly face of the extractive industries. Against the rhetoric of the industries’ contribution to the economic growth, the cases show the complete opposite. For example, although the Philippine’s gold reserves amounted to at least 16.873 billion US dollars or about 76 per cent of the country’s GDP in 2011 – which according to Philippines’ National Statistical Coordination Board is sufficient to completely eradicate poverty in the country – Philippines remains one of the poorest nations in the region. As Arago describes on the Philippines case in her article, one of the major push factors in poverty increase in the country is the massive displacement of fishing and farming communities and subsequent loss of livelihood due to large-scale mining operations. It is clearly not the case that mining operation spurs the growth for the people. On the contrary, it has been impacting social life and creating huge environmental catastrophes.

In India, mining sector has a low contribution to the economy as GDP from the sector has never exceeded five per cent even after liberalisation. Villages in the mining regions, as Ramamurthi explains in his article, are getting devoid of drinking water due to increased competitive use of water by the industry, which huge quantum of water for 300 million populations is being gulped by the mining industries. Besides, forty-two per cent of households in villages in India live without electricity whereas the industry is consuming the major share of electricity.

The case of Indonesia has also shown clear example how the extractive industries have brought about a huge impact on people and environment.  Today the only largest gold reserve in the world is in the poorest province of Indonesia in West Papua. Since 1960s, the gold mining in West Papua has been virtually under complete control of US-based TNCs, including Freeport Mc-Morran Copper & Gold Inc. Since 1991, through the extension of second contract, benefited with the area concession of ​​2.6 million hectares, Freeport Mc-Morran Copper & Gold Inc. had expelled people from their land. In his article, Mufakhir describes that recently at least 60 people were killed and 148 people were imprisoned for obstructing Indonesia’s mining investment. The recent strike involving at least 12,000 workers took place from June 2011 till early 2012, the longest since Reformasi in 1998. During the strike there were at least seven Freeport workers died, not to include two victims from traditional mining area.

In Malaysia, Hector exposes the issue of the Australian TNC, Lynas Corporation Limited. He describes that Lynas Corporation decided to ship rare earths ore from its mine in Mount Weld to Malaysia, where it was to be processed into highly sought after rare earths metals at its facility in Gebeng Industrial Zone in Pahang. As a result, medical examinations on children in the processing area found that nearly 40 per cent of them suffered from lymph node diseases, turbinate congestion and recurrent rhinitis. Seven of the leukemia victims have since died.

Given this barbaric nature of corporation in the extractive industries, it is important for the social movements to resist against the extraction in any way. Indigenous people, workers, and society in general should have democratic control over their lands, their own natural resources, and their livelihood.