Local economic development

Local economic development

Long-term prosperity for all

No business operates in a vacuum – successful businesses depend on successful communities. And to contribute to the social and economic sustainability of those communities, businesses must ensure benefits flow to the local economy and people. This helps build long-term prosperity for all.

Governments and communities want assurance we are sharing the value our operations create through taxes, royalties, employment, procurement opportunities and local investments. We believe that it is through working in partnership that we will continue to share the wealth our operations create.


Community stitches supplier Bayan Uul Khanbogd Mongolia Community stitches supplier Bayan Uul Khanbogd Mongolia

Partnering for success

Establishing a successful partnership requires a combination of soft and hard skills. It's not only about developing a detailed understanding of the social and environmental impacts of a project over its life cycle. It's also about being able to engage with local stakeholders, appreciate their position and negotiate successfully for each party's mutual benefit.

In Mongolia, the 2009 Investment Agreement for our copper-gold mine at Oyu Tolgoi illustrates our approach. The agreement covers tax rates and requirements around infrastructure, regional development and employment. In 2015, we signed a Cooperation Agreement with partner communities at provincial and county level. This commits the mine and communities to work together for mutual benefit, promoting socioeconomic development for current and future generations.

In Australia, we also work hard to share the benefits of our operations. At our Weipa site in Queensland, where we have been mining bauxite since the 1950s, three Aboriginal Agreements underpin all our activities and ensure the social and economic benefits of the site are shared with local communities. At the adjacent Amrun project, we have been running recruitment roadshows to highlight employment opportunities and in Western Australia we have improved our procurement practices to prioritise local businesses wherever possible.


Oyu Tolgoi's in-country spend since 2010

Sustainable development at Oyu Tolgoi and Amrun

Oyu Tolgoi's overall in-country spend has been around US$7 billion since 2010. Three-quarters of this has been payments to Mongolian suppliers, with the rest going on salaries, taxes and other payments to government. Around two-thirds of all procurement is spent directly with Mongolian suppliers and the workforce is 94 per cent Mongolian.

Towards the end of 2017, at the Amrun project in Australia, almost 80 per cent of the workforce were Queenslanders – including 176 Indigenous employees, 43 of whom are local Aboriginal people. And a further 25 jobs for Aboriginal workers were created by one of our suppliers, which is 100 per cent Indigenous-owned.

We recognise we have further to go in delivering continuous benefits to our stakeholders at Oyu Tolgoi, Amrun and elsewhere. But we are confident that our partnership approach is the right way to deliver a positive legacy over time. One that creates a win-win for our company and the communities where we operate.