Gold companies and local economic sustainability: the case of Kalsaka Mining SA in Burkina Faso

Abstract

ABSTRACT Gold mining is a major source of income and economic growth, but imposes substantial environmental and health burdens on local communities. Estimating the relative economic gains and health costs of mining for local communities is a key step towards ensuring better natural resource management and environmental justice, but remains methodologically challenging. The objective of this article is to analyse the contribution of Kalsaka Mining SA to local economic sustainability during the operating phase (2008–2013). A cost-benefit analysis is used in comparing Kalsaka Mining SA local investment and its environmental damage (health cost) during mine lifetime. The net price method is used to evaluate resources rent from Kalsaka mining site exploitation while human capital approach is considered in health damage estimation. The results indicate that rent invested in the local economy was relatively low compared to health cost, implying that Kalsaka Mining SA contribution was largely insufficient to put the local economy on sustainable path.