Sector Programme
Extractives and Development

The Sector Programme “Extractives and Development”

The Extractives and Development Sector Programme is jointly implemented by the Federal Institute for Geosciences and Natural Resources (BGR) and the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ).

The extractive sector can contribute extensively to a country’s economic development. After all, a well-managed extractive sector enables government revenues to be generated that benefit the entire population. At the same time it encourages the building of infrastructure and paves the way for new jobs and training places to be created, especially in supply and processing industries. Additionally, secondary economic sectors are strengthened, which creates a foundation for sustainable economic growth. This is where the significance of the extractive sector for development policy lies.

Given this potential, a growing number of partner countries of the German development cooperation strive for increased benefit from their own natural resource wealth. To achieve this objective, the comprehensive mainstreaming of sustainability strategies in extractive resources policy is of vital importance, to achieve sustainable development in the sense of the 2030 Agenda. First and foremost, this means focusing on good governance, capable (financial) institutions, an improved financial and technical transparency within the sector, as well as fighting corruption. Ecological and social impacts also need to be taken into consideration. Good cooperation between state institutions, the private sector and civil society organisations is also key to establishing an effective extractive sector. State institutions must be able to steer and monitor the extractive sector to ensure that extractive companies comply with legal provisions and pay their taxes and levies on time in order to minimize impacts on the environment, human rights, peace and security. These measures have the simultaneous effect of improving the investment climate, thus facilitating the emergence or strengthening of processing industries within the country. In addition, civil society plays a pivotal role by supporting mining-affected communities, promoting transparency as well as addressing environmental and social risks in mineral supply chains.

In addition to its topic-related work, the Extractives and Development Sector Programme supports the BMZ in providing policy advice. Here it helps the BMZ to shape the national and international development agenda in the extractive sector by adding its own impetus and innovations. The Sector Programme provides constant, comprehensive policy advice to BMZ on matters relating to the extractive industry and extractive resources policy. Its work includes technical support to the German government as it positions itself in international dialogues, initiatives, and institutions and helping to shape all these. The component also represents German development cooperation in the extractive sector in the German development policy actor landscape. Policy advice at BMZ thus plays a part in the preparation and steering of development policy decisions in the extractive sector and in conveying information about them. Policy advice pursues the aim of keeping specialist officials and politicians informed about the technical and scientific background and the repercussions of policy decisions in this field, but doing so in a politically sensitive manner.