Mining Regions and Cities in the Region of Antofagasta, Chile

1. Assessment and recommendations

Assessment

Antofagasta’s mining industry is of strategic importance for the global energy transition and sustainable development in the region

Home to an abundant reserve of minerals that are vital for a low-carbon future, including copper and lithium, the Antofagasta region is in a unique position to become a global leader in responsibly sourced minerals. Antofagasta has world-class geological resources and large global mining companies, including some of the world’s major copper mines, top lithium reserves and important production of molybdenum and boron. The diverse set of assets supporting Antofagasta’s mining sector potential include:

• Geological attractiveness and global mining companies: Antofagasta’s copper and lithium deposits have attracted some of the world’s largest mining companies. This includes four out of the top five global mining companies and seven out of the top ten global copper producers, among which is the state-owned CODELCO, the world’s largest copper producer.

  • Copper: Antofagasta is the world’s largest copper-producing region (approximately 3 million tonnes in 2021), accounting for half of Chile’s production and ahead of Peru, the world’s second-largest copper producer (U.S. Geological Survey, 2023[1]). The region hosts the world’s largest copper mine (BHP Escondida).

  • Lithium: Antofagasta produces all of Chile’s lithium, placing the country as the second-largest lithium producer in the world (U.S. Geological Survey, 2022[2]). The region hosts one of the largest lithium mines in the world (Salar del Carmen).

• Mid-sized mining companies: There are a few mid-sized operations in the region (Franke, Mantos Blancos, Mantos de la Luna, Michilla and Taltal) that account for a small fraction of total copper production and produce some other minerals in larger proportions, most notably gold and silver.

• Export-oriented infrastructure: Antofagasta’s infrastructure, including ports and trains, has been tailored to support its heavyweight mining industry. The region also benefits from the highest broadband access in the country (84.3% of households), which can facilitate economic transformation and diversification.

• National universities such as the University of Antofagasta and the Catholic University of the North, together with research and development centres such as the Scientific and Technological Research Centre of the Antofagasta Region and the upcoming Lithium Institute offer highly qualified training and research. These institutions contribute to the region’s technological advancements, environmental sustainability and the cultivation of a skilled workforce.

Antofagasta’s export-oriented mining sector has propelled economic development in the country and the region. Antofagasta’s gross domestic product (GDP) per capita is the highest in the country and almost twice as high as the average of 50 OECD mining regions.1 The region's contribution to national GDP at 12.8%, is over five times its population share of 2.2%.

The main economic benefits from mining in the region include (next chapter provides further details):

• As of March 2023, Antofagasta accounted for 39.4% of Chile’s total exports, of which approximately 95% were mining-related products.

• The mining sector contributed around 72% of the region’s GDP (March 2023), 7 percentage points higher than in 2022.

• The mining sector accounted for 113 thousand jobs in the region (May 2023), which represents 28.3% of the total employed population and 41% of the nation's total employment in the mining sector.

The green and digital transition in mining offers new opportunities to attain a more inclusive and sustainable development

The increasing global demand for minerals and the green and digital transition in mining will likely represent a greater inflow of investments for Antofagasta in the coming years. As of January 2023, Antofagasta had the second-highest total expected investment in Chile for the next 5 years (24% of total investment of Chilean projects). The mining sector, responsible for 51% of the total expected investment, aims to modernise and expand existing mining operations, primarily in copper mines, or enhance exploration of non-traditional lithium minerals. Most of these mining projects aim to improve environmental sustainability and productivity, using renewable energy sources, desalinated or reused water in mining operations, and greater automation of processes. Under current forecasts, Chilean copper production is set to reach 6.6 million tonnes (Mt) per annum by 2033 (from 5.7 Mt in 2021), with Antofagasta increasing its output to 3.26 Mt (from 3.0 Mt in 2021) (COCHILCO, 2022[3])

The energy sector accounts for 44% of total expected investments in Antofagasta for the next five years, mainly greenfield projects of solar and wind energy production and transmission projects. Antofagasta has registered 13 new renewable energy projects (including solar, wind and hydrogen) for a total of 6 982 megawatts (MW), leading among all Chilean regions (Ministerio de Energía, 2022[4])

Due to its favourable geographic location and export infrastructure, the region can become a logistic gateway for increasing mining ventures in neighbouring countries, such as Argentina and Bolivia, which are attracting investments mainly for lithium production but currently lack adequate transport infrastructure.

However, without a proactive strategy, the region may miss out on opportunities to benefit from digital and green projects in mining and, instead, increase the exposure of the regional workforce and companies to adverse environmental and social risks. For instance, automation in mining operations will require a new set of skills and types of inputs that are adapted to the new technologies. Similarly, new mining and energy investments and the opportunity to become a strategic player in mining in Latin America require an agile regulatory and permitting process, clear communication on the potential of mining for local development and standard benefit-sharing agreements to improve impacts on communities and secure a social license for new developments.

Beyond its mining industry, Antofagasta benefits from additional assets that can contribute to economic and social development.

Beyond mining, Antofagasta has additional assets to support its development. Its tourism sector benefits from the Atacama Desert, known for its prominent natural landscapes, preserved ecosystems and unique biodiversity. The region is also home to several natural preservation areas, offering opportunities for ecotourism, adventure tourism and wildlife observation. Additionally, Antofagasta boasts a rich cultural heritage, including significant archaeological sites and Indigenous communities that uphold their traditions and customs. This cultural wealth presents opportunities for cultural tourism, promoting cultural exchanges and fostering understanding and appreciation of the region’s Indigenous heritage.

Another noteworthy asset is the region’s growing astronomy sector. Antofagasta benefits from its exceptional astronomical conditions, including clear skies and low light pollution, making it an ideal location for stargazing and astronomical research. The region hosts several observatories (e.g. Gemini Sur, Paranal) and research centres, attracting scientists, astronomers and astronomy enthusiasts from around the world. Supporting the growth of this sector can not only contribute to scientific advancements but also stimulate tourism and educational initiatives centred around astronomy. Table 1.1 summarises some of the main assets of the region.

Table 1.1. Main assets of Antofagasta

Assets	Description
Economic
Strong mining sector	Antofagasta’s mining sector provides the largest mineral production and exports in the country, with a pool of multinational companies and a network of globally competitive mining service companies. Geological potential with essential minerals for the global green transition, such as copper and lithium.
Export-oriented infrastructure and high broadband connectivity	Antofagasta’s export-oriented infrastructure facilitates the transportation of mining products to global markets, driving economic growth and international trade. Additionally, the region’s robust broadband connectivity, with over 83.4% of households having Internet access, supports various digital activities, including business operations, remote work and online education.
Social
Young and growing population	The region has a population growth rate of 2.5%, above the national average (1.53%). The population is young, with the 25-44 age range representing 53.2% of the total population, providing a vibrant workforce.
Institutions of education and research	The region has several higher education and research institutions, including the University of Antofagasta, the Catholic University of the North and the upcoming public technological institute for the research of lithium. These institutions support the local economy and workforce development by providing training and conducting research in relevant fields.
Environmental
Renewable energy potential	In addition to its vast mineral reserves, Antofagasta is rich in solar energy potential due to its high level of sunshine hours, offering opportunities for renewable energy development.
Ecotourism	Antofagasta’s diverse assets, including its vibrant tourism sector in the Atacama Desert and rich cultural heritage with significant archaeological sites and Indigenous traditions, provide a robust foundation for economic and social development, emphasising ecotourism, adventure, wildlife observation and cultural tourism.

Mining wealth has led to rapid population growth relative to both the national average and comparable OECD mining regions

Spanning a considerable geographic expanse alongside the Pacific Ocean, Antofagasta’s population density (5.7 individuals per square kilometre) is around one-quarter of the average in Chile (24.06), ranking as the fourth least densely populated region in the country and in the bottom 25% of 50 OECD mining regions.

Population growth over the past decade (2.5% annual average) has outpaced the national average (1.53%) and the average of 50 OECD mining regions (0.8%). The steady increase in Antofagasta’s population is largely driven by international migration. As of December 2021, the region hosted 106 000 foreign residents, comprising about one-seventh of the total regional population. About half of the region’s foreign residents live in Antofagasta (15% of the city’s population) and one-fifth are in the city of Calama (16% of the municipal population). In particular, the region is attractive to a working-age population, with 53.2% of all foreign residents between the ages of 25 and 44, contributing to the demographic shift and rapid growth in the region.

While the region’s population increase holds potential for Antofagasta’s development, it also presents specific challenges, including the integration of the migrant population, the efficient provision of services to all citizens and land use planning. For instance, the rapid growth of the migrant population has added pressure on the local labour market and the community infrastructure. This population experiences a higher share of housing overcrowding (20.6% vs. 5.8% for those born in Chile) and a lower attendance rate for higher education (11.4% among 18-24 year-olds vs. 38.8% for those born in Chile). This situation highlights the need for better mapping the skills of the migrant population to improve labour demand matching and inclusive policies that foster social cohesion and cultural understanding.

Despite the vast amount of wealth brought by mining, many communities lag across a wide range of well-being dimensions

Initiatives so far have tried to translate mining wealth into greater well-being standards but in an isolated manner

Different policies and initiatives in Chile and the region of Antofagasta have tried to better translate mining wealth into greater well-being standards for the local population. At the national level, the Ministry of Mines and the Production Development Corporation (CORFO) have promoted policies and strategies to promote development in Antofagasta (e.g. the Alta Ley Corporation), mainly targeting economic objectives in the region.

At the regional level, the Mining Cluster of Antofagasta was one of the first plans to improve the interaction of the local economy with the mining process. Private companies CODELCO have also undertaken initiatives to improve the impacts of mining in local communities. They include initiatives such as Calama Plus, Creo Antofagasta and the World Class Supplier Program.

However, those different programmes and policies have been spurious and isolated, lacking effective co‑ordination amongst each other and scalability to deliver higher well-being standards. For example, the mining cluster initiative, in its different forms, has fallen short in unifying support actions and local procurement of mining companies and in improving knowledge transfer to promote national and international growth of local businesses. This policy alone was not enough to address the increasing outsourcing of mining activity and relocation of production chains outside the region (Atienza et al., 2015[5]). Likewise, the Calama Plus initiative, a joint effort between the public and private sectors of Calama, did not manage to meet expectations and implement the agreed projects. Part of the obstacles to this initiative’s success included a governance body with unequal decision power and mining companies with more power to prioritise their projects. In turn, local communities lacked the capacity to structure and implement their preferred projects.

Structural well-being gaps remain across the region of Antofagasta

Despite its high potential, many communities and citizens in Antofagasta have so far been left behind across economic, social and environmental dimensions of well-being.

Economically, Antofagasta’s income inequality (Gini coefficient of 0.51 in 2019) is above the national average (0.46), as well as its unemployment rate (9.6% in 2021 vs. 9.1% in Chile and 7% across 50 OECD mining regions). Most of the copper production in Antofagasta is done by large companies, with small and medium-sized enterprises (SMEs) being marginal producers of copper (0.4% and 0.94% of the regional copper production in 2021). Despite the prominence of the mining industry in Antofagasta’s economy, local businesses have little involvement in value-added mining activities in the region. Despite being the first mining region in the country, only 26% and 12% of the mining industry suppliers of copper and lithium in the country respectively are registered in the region (Atienza et al., 2015[5]). Moreover, the copper industry in the region currently provides few opportunities for forward linkages with local businesses, as most of the copper extracted in the region (99%) is exported to Asia for refining. This is linked to a relatively lower cost‑efficiency of Chile’s smelting industry, with an average of USD 211 per tonne (USD/t) of copper produced, far above the industry average of 114 USD/t (COCHILCO, 2022[6])

Socially, the region records the lowest life expectancy (79.2 years) amongst Chile’s 16 regions and the fifth lowest life satisfaction index in the country. Low levels of life satisfaction in the region reflect community concerns about the scarcity of parks and green areas for recreation and leisure activities.

Moreover, Indigenous communities face acute challenges across a number of areas. These communities in 2017 represented 9.5% (18.5% of the rural population and 8.2% of the urban) of the regional population and recorded higher income poverty rates (14.5%) than non-Indigenous communities (8%); yet, between 2011 and 2017, the extreme income poverty rate decreased by over 10 percentage points (14.5% to 4%). Indigenous people also report greater difficulties in accessing quality health, with malnutrition affecting Indigenous children aged 0 to 6 years. For instance, the percentage of children aged 0-6 years who picked up free food at the clinic or hospital in the last 3 months was 10.4 percentage points higher in Indigenous populations (63.9% compared to 53.5%). Furthermore, Indigenous individuals face challenges in education, with 45% of those aged 19 and above not completing secondary education (compared to 36.6% for non-Indigenous individuals) (CASEN, 2017[7]).

This calls for more inclusive and equitable benefit-sharing arrangements between Indigenous peoples and mining companies that can deliver poverty reduction, improve access to public services, offer meaningful participation in decision making and better track their progress. To address these issues, other mining regions, such as Northwestern Territories and Ontario in Canada, have improved institutional and financial conditions for Indigenous communities to participate in decision making, share the benefits of mining or even own mining operations.

Environmentally, the region emits, on average, 38% more greenhouse gas (GHG) emissions per unit of electricity generated compared to 50 OECD mining regions. This issue underscores the need for sustainable practices and the introduction of energy-efficient technologies within the region’s key industries. Among Antofagasta’s sub-regions, Tocopilla exhibits the highest per capita GHG emissions, placing it within the higher range of emitters across OECD mining regions. Furthermore, water resource management, especially considering the arid nature of Antofagasta, emerges as a crucial environmental challenge. This was highlighted between 2018 and 2019 when the region’s sub-regions experienced drier conditions when compared to other OECD mining regions. El Loa faces a significant impact, with a higher ranking among the OECD mining regions for soil water content anomalies.

Mining activities in the region have also been associated with higher levels of fine particulate matter 2.5 (PM2.5) particles in the air. This poses potential health risks for residents, with the possibility of increased incidences of respiratory and cardiovascular diseases. The transformation of the region’s natural landscape due to these activities has implications for residents’ quality of life and future tourism prospects. Addressing these concerns calls for a more comprehensive and up-to-date environmental data collection and monitoring system. These enhancements will allow for more accurate assessments of the environmental impact of mining and enable the development of more effective responses.

All of the gaps described are multidimensional (see Table 1.2 for a summary of the main challenges) and will not be solved overnight. Approaches so far have left many communities and citizens behind despite the wealth generated through mining activities. Thus, there is a need to develop a new development strategy that is bottom-up led, reflects local priorities, offers opportunities for local firms and entrepreneurs, has a medium- to long-term perspective, is holistic and better co‑ordinates efforts by different levels of government, the private sector and academia to align strategies and efforts of all actors towards delivering higher well-being standards.

Table 1.2. Main challenges of Antofagasta

Challenge	Description
Economic
Dependency on mining	Antofagasta’s economy relies heavily on mining, making it vulnerable to fluctuations in global commodity prices and demand for minerals. Economic downturns in the mining sector can lead to job losses, reduced investment and a decline in overall economic activity in Antofagasta. Therefore, diversifying the economy and reducing the reliance on mining is crucial to enhancing the region’s economic resilience and stability.
High unemployment and income inequality	Despite its economic prosperity, Antofagasta has a higher unemployment rate (9.6% as of 2021) than the national average. Furthermore, the region’s income inequality, as represented by a Gini coefficient of 0.51, is also higher than the national average. Addressing this disparity and creating more job opportunities across various sectors is a major economic challenge for the region.
Social
Limited access to quality services	While Antofagasta is the leading Chilean region in broadband access, it may face challenges in other areas of service provision due to its low population density and remote location. There might be issues in the quality and access to education, healthcare and other important services, especially for the more isolated and vulnerable populations (e.g. Indigenous peoples).
Low perception of quality of life	Despite the region’s high GDP per capita, life satisfaction is relatively low. This could reflect a variety of issues, including dissatisfaction with public services (e.g. health, education, etc.), security levels, recreational and cultural infrastructure, as well as environmental concerns.
Environmental
Risk of lack of water resources	Antofagasta is one of the driest regions in the world, with nearly all of its freshwater coming from outside sources. This presents significant challenges in terms of securing sustainable and affordable water supplies for both residents and industries.
GHG emissions and lack of environmental information	The region’s reliance on mining contributes to high GHG emissions and potential water contamination, posing a threat to the local environment and people’s health. Improvement of environmental information systems is critical to monitor biodiversity, freshwater quantity and quality together with air pollution levels.

At the same time, the mining sector is facing increasing challenges to remain competitive

Global megatrends, including demographic change, climate change and the transition to a low-carbon economy, as well as digitalisation and automation, are bringing new challenges and opportunities to the mining sector. The main challenges affecting the future competitivity of the Chilean mining sector include:

• Productivity and diminishing ore grades: The productivity of mining in Chile and Antofagasta has been in decline for the past 20 years (De la Huerta, 2018[8]; OECD, 2022[9]). This decline can be attributed to deteriorating ore grades and extraction to greater depths that require longer processing and internal transportation times and higher energy and water consumption.

• Availability of skills: There is a significant deficit both in terms of employees and competencies needed in mining-specific skills. For the period 2021-30, a 25 000-employee gap is foreseen due to the compound effects of the retirement of current workers and the expected creation of new jobs resulting from the sophistication of mining operations (CCM and Programa Eleva, 2021[10]).

• A complex and centralised land management system: An overly centralised public land administration and management system, coupled with widespread mining property speculation, has resulted in land scarcity and a costly, bureaucratic process for obtaining public lands for productive purposes, such as downstream activities in mining processes (Martorell Awad, 2020[11]).

• The imperative to swiftly align with evolving environmental requirements: Persistent concerns and doubts about the long-term environmental effects of mining persist, with an absence of coherent and systematic strategies to address these concerns. These issues encompass doubts regarding the long-term impact of marine water capture and desalination, as well as the region’s substantial carbon footprint. At the same time, norms aiming at reducing the use of continental water have excessively encouraged the use of desalinated water, providing fewer incentives for other alternatives, like water reuse. This disproportionately affects medium-sized mines that lack the capacity to invest in desalination infrastructure.

• Social concerns: The equitable allocation of benefits from the industry, both at the regional and local community levels, may become challenging due to the changes in procurement and labour demand brought by digitalisation in mining.

A long-term strategy is warranted to leverage mining benefits in view of reducing well‑being gaps and taking advantage of the green and digital transition in mining

Mining has been the central engine of growth for the region of Antofagasta and Chile as a whole. Still, it is clear that a new social pact is needed to ensure both an equitable distribution of wealth and opportunities across the region and the development of a competitive mining sector with more environmentally sustainable practices.

The forthcoming Mining Strategy of Well-being for the Region of Antofagasta 2023-2050 (hereafter the Mining Strategy) can be that new social pact that sets a roadmap to strengthen Antofagasta’s mining sector and ensures that the mining wealth provides a long-lasting increase in well-being standards for its citizens. It can also align different strategies and actions towards common efforts, unify different visions within the regions and improve co‑ordination with Chile’s mining national strategy and other regional development policies.

The ongoing decentralisation process in Chile presents a new setting to establish a new vision for development

The ongoing decentralisation process in Chile provides the institutional and political momentum to establish a new mining strategy in Antofagasta. Since 2021, regional governors in Chile can be elected by popular vote every four years (La Biblioteca del Congreso Nacional de Chile, 2021[12]). Under this framework, the governor has acquired new responsibilities and tools, including the development of investment strategies and land use planning. This represents an important shift from the previous multilevel governance structure, where each region was governed by an Intendent, a delegate appointed by the president of Chile to administer the resources and design the policies for the region.

This change provides scope for improved adaptions of regional and national policies to better meet local needs, opportunities and challenges, enhance accountability and help facilitate institutional channels for communities to participate in decision making.

A medium- and long-term vision that moves from past challenges towards a common path for the future

Setting a clear and ambitious goal in the strategy is useful to align efforts across different levels of government and other regional stakeholders to meet common goals, attract skilled workers and new investors and create partnerships with international actors that support the region’s long-term plan.

To build trust across different parts of society, improve policy certainty and move towards a common regional goal, this strategy would benefit from recognising the priorities raised by different societal stakeholders:

• On the one hand, recognising that some communities have been left behind in several well-being dimensions, more must be done to deliver development opportunities locally. This involves prioritising a range of issues, from access to quality public services such as childcare and secondary care to the availability of parks and green spaces for recreation and leisure activities, with the active involvement of the community.

• On the other hand, recognising the strategic role of the mining sector in the future development of Antofagasta involves improving efficiency in government processes to facilitate the expected investments and ensure certainty in their implementation.

The regional government has already anchored the process of elaborating the strategy in the construction of a new regional pact. The former recognition, demanded from both the private sector and the communities, will facilitate discussions about a shared future for the region. This transition involves shifting from a perspective overly focused on past challenges towards a narrative centred on collaboratively constructing a better future.

The new strategy can materialise the main development priorities via common objectives and strategic projects in the short, medium and long terms

The new strategy needs to set concrete and common medium- to long-term objectives and agreements that address the main development priorities in the region and set the path for regional development policies that can leverage mining to improve well-being. These objectives need to be agreed with regional stakeholders and be based on bottom-up-led development priorities. Five areas of action are identified as the highest priorities to achieve the vision of this strategy:

• Improved well-being standards for all, with focalised actions for Indigenous and non-Indigenous communities.

• Expanded participation of the local economy and regional businesses in current and new mining development projects. This requires strategies that target business opportunities throughout the value chain, including exploration, extraction and transformation of minerals.

• Enhanced skills and regional knowledge ecosystem to ensure that the workforce and regional innovation ecosystem make the most of the digital and green transition in mining.

• A more efficient institutional framework to provide certainty in the process of permits and other government processes for mining projects, including greater government capacity to study environmental and land use permits and monitor private sector compliance.

• Greater efforts to rehabilitate and preserve the environment from the effects of mining and industrial processes, which needs to start by improving baseline information on the impact of mining on inland water, air pollution and biodiversity.

Attaining the objectives and agreements requires specific actions that build trust in the strategy over the short term and ensure a long-term implementation. To this end, a timeframe of strategic projects should be put in place by indicating the projects that are a priority and feasible to implement in the coming years (e.g. 2023-30) and those others that are inscribed in the medium and long terms (2030-50). A series of common agreements, strategic projects and public policy proposals have been identified from the meetings with regional stakeholders in the preparation of this strategy and the direct information provided to the regional government since October 2022 by key stakeholders. The short-term projects can leverage the pipeline of projects to be developed i the regional plan or the corporate social responsibility plans of mining companies. These short-term projects can help create local alliances to work towards a unified vision and improve social acceptance of the strategy.

A governance system to oversee, monitor and adjust the strategy in the medium and long terms

For the strategy to be successful and lasting, a governance mechanism must be implemented and capable of making the strategy last beyond political cycles, which allows prioritising projects and deciding the best way to implement them, as well as monitoring their results until 2050. This governance must be made up of various actors in the region, with a clear structure of participants and an established decision-making capacity and frequency of meetings. Other OECD regions like Brainport Eindhoven the Netherlands or Morelos in Mexico have adopted multi-stakeholder governance models to oversee the design and implementation of key strategies for regional development.

Moreover, Antofagasta’s Mining Strategy needs to be accompanied by a monitoring framework with different types of indicators to ensure a sound implementation at the different stages of the strategy. This can include impact indicators to measure the long-term policy effect of achieving each of the strategic objectives and outcome indicators to monitor the implementation of the common agreements and the strategic projects in each objective. In turn, a set of output indicators is needed to measure the implementation of the operative tasks in each strategic project.

Recommendations

Formalise and implement the Mining Strategy with a timeframe of strategic projects based on the priorities of the different regional stakeholders

To this end, the regional government should:

1. Formalise the Mining Strategy with a dedicated budget within the institutional and policy framework of the government of Antofagasta.

2. Recognise in the Mining Strategy the need for a new regional pact among Antofagasta communities and private sector to build trust across different actors and promote common agreements to improve future developments of the region and move forward with the Mining Strategy.

3. Ensure that the Mining Strategy provides a medium- and long-term vision that reflects the aspiration for the region to increase well-being standards in economic, social and environmental dimensions, building on a competitive and environmentally responsible mining sector.

4. Establish concrete objectives in the Mining Strategy that address local priorities and are based on common agreements across the region’s different actors to attain the Mining Strategy's final vision. These objectives should help to:

• Improve the quality of life of local communities and Indigenous peoples with strategies that improve access to services in mining communities, support projects to diversify the economy (e.g. tourism or desert-based agriculture) and co‑ordinate corporate social responsibility programmes of mining companies.

• Increase the participation of regional businesses in the mining value chain. This includes supporting suppliers and technologies that can address key regional mining priorities (e.g. water and air pollution management), promoting local entrepreneurship in the circular economy in mining and supporting sustainable practices of small/medium mining companies.

• Strengthen skills and the regional knowledge ecosystem, including supporting the Lithium Institute with a roadmap of innovative projects, promoting apprenticeships in mining, establishing formal spaces for exchange between businesses and academia, and improving the quality of education from pre‑school onwards across the region.

• Improve governance for a more productive and sustainable mining sector, including through improving the capacity of environmental institutions in the region, promoting shared mining infrastructure (e.g. desalinated water facilities) and greater connections with renewable energy projects, attracting companies interested in other minerals (e.g. rare earth minerals) or ensuring a just transition in water management by mining companies.

• Rehabilitate and preserve the environment. This involves supporting civic environmental monitoring, improving information on the effects of mining on air or water pollution and incentivising a more efficient use of water (e.g. technologies for water reuse).

5. Implement short- and medium/long-term agreements, strategic projects and public policy proposals to attain each of the objectives of the Mining Strategy. Several strategic projects have been identified throughout different multi-stakeholder meetings in the region.

Table 1.3 depicts the suggested objectives and examples of strategic projects, building on multiple meetings with regional stakeholders.

Table 1.3. Suggested objectives and timeframe of the strategic project for the Mining Strategy

Timeframe	Improve the quality of life of local communities and Indigenous peoples	Increase the participation of regional businesses in the mining value chain	Strengthen skills and the knowledge ecosystem in the region	Improve governance for a more productive or sustainable mining sector	Rehabilitate and preserve the environment
Short term (2023-30)	Improve drinking water and sewerage systems in mining communities	Measure the participation of regional companies in the mining value chain and establish a roadmap of opportunities	Set a roadmap of local value-added projects within the Lithium Institute (e.g. water management)	Improve the capacity of environmental institutions in the region (e.g. the Superintendence of the Environment)	Support civic environmental monitoring
	Facilitate the upgrade or installation of quality health centres	Expand the participation of local businesses in mining companies’ programmes to upscale providers	Promote apprenticeships in mining across regional schools	Facilitate approval of industrial land (in collaboration with the SEREMI of Public goods)	Reduce air pollution from mining operations
	Expand the number of recreational and green infrastructure, and public lighting	Promote synergies among mining companies’ programmes on local procurement	Complement mining companies’ training programmes to extend coverage	Improve collaboration between large and small/medium mining companies	Reduce mining waste generation and facilitate its valorisation
Medium to long term (2030-2050)	Fund/structure to support the creation of Indigenous businesses	Support technology transfer to regional companies	Adapt basic education to prepare students for the automation of mining processes	Enhance the capacity of local governments to structure, submit and approve projects	Reduce to a minimum the use of inland water for mining activities
	Fund/structure to promote economic diversification (e.g. agriculture in the desert, artisanal fishing)	Internationalise the regional mining providers	Support a network of research centres for the mining of the future	Ensure that processes for metal recovery or extraction (e.g. oxide leaching) are achieved on time and with high environmental standards	Evaluate the mechanisms to return water rights to the communities
	Improve tertiary roads, broadband and satellite infrastructure	Support local entrepreneurs/ SMEs to boost circular economy activities in mining (recycling of lithium)	Improve the quality of education with a focus on reducing inequalities across the region	Promote greater use of renewable energies in mining operations (e.g. speeding up permits for interconnection and generation)	Produce an environmental diagnosis of the region

Establish a governance mechanism to monitor progress and ensure the sustainability of the Mining Strategy over the long run and beyond government cycles

This mechanism could benefit from the following elements:

6. Define a new role for a public official in the government, with responsibility for co‑ordinating the Mining Strategy and ensuring its implementation and continuity, with a defined budget and a team for operation and co‑ordination.

7. Establish a steering committee in charge of prioritising projects, rendering accounts of monitoring and evaluation, and proposing new orientations to the Mining Strategy. It should comprise representatives of relevant actors in the region (private and public sector, civil society and Indigenous communities), with periodic rotation to expand possibilities of participation and representation (e.g. two years) and a consensus-based decision process.

8. Establish a technical committee in charge of overseeing the projects, providing updates on the progress of projects and budgets and responding to other requests from the steering committee. This committee is made up of an executive secretary and a team of professionals, in collaboration with personnel from academia and the private sector.

9. Ensure that the Mining Strategy upholds Indigenous peoples’ rights and promotes meaningful participation in the decision making and prior and informed consent in the design and implementation of relevant strategic projects for these communities.

Define a monitoring and evaluation framework with different levels of indicators

10. Set up an evaluation framework that can recurrently measure the outputs and outcomes of the various strategic projects to attain each of the objectives of the Mining Strategy.

11. Monitor the overall Mining Strategy’s progress in improving the region’s well-being standards through specific impact indicators that are horizontal to the strategic projects in each objective.

Ensure a formal channel of communication and involvement of regional stakeholders in the Mining Strategy’s construction, progress and changes

12. Establish an appropriate communication strategy to disseminate the Mining Strategy and its construction process with annual public reports on the progress of the strategy via media or public gatherings.

13. Map and publicly report information on the environmental, social, and corporate governance (ESG) initiatives from the mining companies in the region.

Improve the institutional capacity of the national agencies operating at the regional level

The national government is crucial to the regional Mining Strategy’s success and ensuring a more sustainable mining sector in Chile. To this end, it should:

14. Co‑ordinate with the regional government of Antofagasta to identify institutional needs in the region and define methods to increase the capacity and upgrade the Regional Ministerial Secretaries (SEREMIs) – especially the SEREMI of the Environment, the SEREMI of National Goods and the National Geology and Mining Service – and the Superintendence of the Environment. This support should be aligned with the needs of the region’s SEREMIs as listed by the regional government during the development of the strategy.

15. Improve government co‑ordination to better involve Indigenous communities in policy making around mining and their territories.

References

[5] Atienza, M. et al. (2015), ¿ Es la región de Antofagasta un caso exitoso de desarrollo local basado en la minería?, C. Rodríguez, M. Atienza, M. Lufin, G. Romaní, JA González, R. González, https://doi.org/10.1016/j.respol.2015.07.003.

[3] C. (ed.) (2022), Inversión en la minería chilena: cartera de proyectos 2022-2031 [Investment in Chilean mining: Portfolio of projects 2022-2031], https://www.cochilco.cl/Listado%20Temtico/2022%2011%2007%20I.

[7] CASEN (2017), Ministerio de Desarrollo Social, http://observatorio.ministeriodesarrollosocial.gob.cl/storage/docs/casen/2017/Casen_2017_Pueblos_Indigenas.pdf.

[10] CCM and Programa Eleva (2021), Estudio de la Fuerza Laboral de la Gran Minería 2021-2030 [Large-scale Mining Workforce Report 2021-2030],, Consejo de Competencias Mineras and Programa Eleva, Santiago de Chile, https://fch.cl/publicacion/estudio-fuerza-laboral-de-la-gran-mineria-chilena-2021-2030/.

[6] COCHILCO (2022), Informe Mercado de Fundiciones 2022 [Smelter Market Report 2022], Comisión Chilena del Cobre, Santiago de Chile, http://www.cochilco.cl/Mercado%20de%20Metales/Informe%20Fundiciones%202022%20Versión%20Final%20RPI.pdf.

[8] De la Huerta, C. (2018), The Implications of Exhaustible Resources and Sectoral Composition for Growth Accounting: An Application to Chile, https://www.bcentral.cl/documents/33528/133326/dtbc807.pdf/126033b1-b505-b436-9c4d-1a4f38235b18?t=1573277855347 (accessed on August 2023).

[13] IEA (2023), Critical Minerals Data Explorer, IEA, Paris.

[12] La Biblioteca del Congreso Nacional de Chile (2021), Elección democrática de gobernadores regionales, https://www.bcn.cl/portal/leyfacil/recurso/eleccion-democratica-de-gobernadores-regionales (accessed March 2023).

[11] Martorell Awad, A. (2020), Mineral rights owners and renewable energies in Chile: an unsettled conflict, Latin American Legal Studies, Vol. 6, Santiago de Chile, pp. 341-366, https://lals.uai.cl/index.php/rld/article/view/64/73 (accessed on August 2023).

[4] Ministerio de Energía (2022), “Industria de generación compromete inversión por USD 23 mil millones en renovables para liderar la transición energética [Generation industry promises investment of USD 23 billion in renewables to lead the energy transition].

[9] OECD (2022), OECD Economic Surveys: Chile 2022, OECD Publishing, Paris, https://doi.org/10.1787/311ec37e-en.

[1] U.S. Geological Survey (2023), Mineral commodity summaries 2023, US Geological Survey, https://doi.org/10.3133/mcs2023.

[2] U.S. Geological Survey (2022), Lithium, Mineral Commodity Summaries, January 2022.

Note

← 1.  The OECD’s Toolkit to Measure Well-Being in Mining Regions identifies 50 OECD mining regions with a high specialisation in mining activity relative to their respective countries to better benchmark well-being trends relative to other OECD regions and identify challenges and strengths.