New IGF Study on Local Content Policies in the Mining Sector

The Intergovernmental Forum on Mining, Minerals, Metals and Sustainable Development (IGF) has published a new study looking at how mineral-producing countries design and implement local content policies in the mining sector. The study “Local Content Policies in Mining: In-sights from a Survey of Producer Countries” provides an analysis of experiences and lessons learned from implementing such policies, based on a survey conducted in June 2025 across countries in Africa, Asia, Europe and Latin America. The study was supported by the GIZ Sec-tor Programme Extractives and Development, commissioned by the German Federal Ministry for Economic Cooperation and Development (BMZ).

Access the study: Local Content Policies in Mining: Insights from a survey of producer countries (External link)

Why local content matters

In the mining sector, local content refers to the extent to which economic activities linked to mining generate value within the domestic economy. The term local combines three comple-mentary dimensions:

1. a geographical dimension, focusing on benefits for communities near mining sites or at the national level;
2. a value-added dimension, referring to economic activities such as processing, manufac-turing or services carried out domestically; and
3. an ownership and control dimension, relating to the participation of domestic firms or citizens in mining activities.

The content component describes the types of economic activities and capabilities that poli-cies aim to localise – such as local employment opportunities, supplier development, and knowledge transfer within mineral value chains.

Local content policies are increasingly important as they shape how resource-rich countries translate mining investments into broader economic benefits and contribute to national devel-opment objectives. From an economic perspective, local content policies can support job crea-tion, local supplier development, value addition and shared infrastructure. They can also pro-mote social inclusion by expanding employment opportunities and strengthening the participa-tion of women, Indigenous Peoples and other marginalised groups. Visible local benefits are crucial for maintaining the social licence to operate as projects that fail to deliver such benefits are more likely to face community resistance and operational disruptions. Local content poli-cies are, therefore, not only a development policy instrument but also a strategic consideration for companies seeking stable and predictable operating environments.

Key findings

The study highlights several key trends in how governments currently design and implement local content policies:

• Local employment and supplier development are the main priorities of most local content policies.
• Around 80% of surveyed countries promote opportunities for communities near mining sites, while many (37%) combine this with measures supporting firms and individuals across the entire country.
• The most popular measures include requirements for a fixed share of employees to be local, localisation plans to increase local hiring, and training obligations for local workers. Many governments also support domestic suppliers – most commonly through technical support – and complement these measures with local procurement requirements.
• Some countries also promote mineral processing and value addition, for example, through requirements for minerals to undergo a certain level of processing before export.
• Countries are increasingly learning from past experiences and adjusting their policies ac-cordingly, while in some regions – such as West and Central Africa – neighbouring coun-tries are beginning to harmonise local content polices, which can facilitate regional invest-ment and supplier development.
• The survey also highlights challenges in implementing local content policies due to gov-ernments limited technical capacity as well as insufficient access to financial and data re-sources, coordination challenges between government agencies and capacity constraints among local suppliers and workers.

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Figure 1: Survey responses on government's priorities for local content in mining.

A case study from the Philippines illustrates both the potential and challenges of local content policies in practice. Under the country’s Mining Act, companies are required to give preference to Filipino workers and local suppliers, provided that safety, quality and price conditions are met. These measures have supported opportunities for local businesses and workers. Howev-er, the study notes that the country has yet to realise its full local content potential due to im-plementation challenges, including limited institutional capacity, insufficient data on local pro-curement and coordination challenges among government agencies.

Conclusion

Overall, the survey indicates that IGF member states generally consider their local content policies to be successful. Governments have adapted their policies based on lessons learned and adjusted requirements to increase local benefits without overburdening industry. The study highlights the importance of realistic targets, continuous monitoring and strong institu-tional capacity to maximise the developmental benefits of mining.

These findings align with the approach of German Development Cooperation, which supports partner countries in strengthening local value creation in the raw materials sector through its engagement in international platforms such as IGF and bilateral, regional and global projects. For example, GIZ programmes in Ghana, Guinea and the Democratic Republic of the Congo support local small and medium-sized enterprises (SMEs) in becoming qualified suppliers to the mining sector through business training, networking and partnerships with industry and training institutions. In addition, initiatives such as the CONNEX Support Unit assist partner countries in addressing local value creation and downstream opportunities early in negotia-tions with investors and mining companies. Tools such as the Local Procurement Reporting Mechanism (LPRM) further increase transparency on local sourcing and help governments and local businesses identify opportunities for participation in raw material value chains.