World Gold Council Members contributed $38bn to local economies in 2020

A new report by the World Gold Council highlights the role of its members, many of the world’s most forward-thinking gold mining companies, in contributing to socio-economic development in the countries and communities where they operate. Collectively, WGC member companies contributed $37.9bn to the GDP of the countries where they operate in the form of taxes, salaries and payments to suppliers. This represented 63% of the total revenue they received from gold sales and equates to almost US$1,100 in value added locally for every ounce of gold produced.

WGC member companies employed 200,000 people directly, 95% of whom were nationals of the host countries. In addition, these companies supported an additional 1.2 million jobs through local suppliers. It is notable that wages among WGC member companies are on average six times higher than the national average. Furthermore, for every dollar spent on imports, close to five dollars were spent on local sourcing.

The Social and economic contribution of gold mining report was based on data provided by 31 World Gold Council member companies. The WGC collaborated with research partner, Steward Redqueen, who used an econometric Input-Output model, which quantifies financial flows between economic sectors, to calculate the industry’s indirect impact and overall value added. The analysis combined financial data from WGC members with macro-economic and employment statistics from publicly available country datasets.

Key highlights of the report include:

  • In 2020, WGC member companies directly paid US$8.7bn in employee wages and US$7.6bn in tax payments to governments in 38 countries where they operate.
  • On top of this, direct payments of US$26.0bn were made through in-country procurement and the resulting indirect value added was estimated at US$21.6bn to local suppliers.
  • In 2020, the GDP contribution of WGC member companies and their supply chains in countries heavily reliant on gold mining is comparable to the quantum of Overseas Development Assistance those countries receive.
  • In 2020, WGC member companies directly employ close to 200,000 people and support a further 1.2 million jobs through their local suppliers. These 1.4 million jobs induce another 700,000 jobs in local economies. In other words, every job in the gold mining industry supports six more, or close to ten more if induced jobs are included.
  • A strong focus from WGC member companies on local hiring in recent years has led to demonstrable results, with local employees making up 95% of the workforce, halving the percentage of expats in the workforce (from 10% to 5%) over the past 7 years.
  • Gold mining employees are well paid. Wages among WGC member companies are on average six times higher than the national average.
  • The industry continues to evolve and improve its ESG performance, as reflected in the adoption of the Responsible Gold Mining Principles by all WGC member companies and several other leading gold miners.
  • In 2020, WGC member companies contributed $438 million to communities and Indigenous groups.

Sandeep Biswas, CEO Newcrest Mining and Chair of the World Gold Council ESG Taskforce said: “Gold producers are working in partnership with communities, governments and civil society in countries where we operate to share the value created by responsible mining. This report outlines the enormous social and economic contribution our industry is making in countries across the world.

Responsible gold mining companies boost local economies by creating well paid local jobs, making significant tax payments and creating valuable long-life infrastructure. Investments made by the gold sector will continue to deliver long-term benefits to local communities, extending to well after mine life ends.”

Terry Heymann, Chief Financial Officer at the World Gold Council, said: “The World Gold Council and our members have long believed that when responsibly undertaken, gold mining can contribute significantly to social and economic development for host communities and countries.

This report clearly sets out the important role responsible gold miners play in supporting local and national economies. We believe that this comprehensive data set can help provide further transparency into the contribution made by the responsible gold mining sector. The report also provides further evidence of the important contribution made by this industry in advancing the UN Sustainable Development Goals.”


To read the report in its entirety, please visit this page: The Social and Economic Contribution of Gold Mining.
 

You can follow the World Gold Council on Twitter at @goldcouncil and Like on Facebook.

ENDS

For further information please contact:

Damian Kerr
World Gold Council
T +44 20 7826 4767
E [email protected]

George Peele Instinctif Partners
T +44 75 1753 9427
E [email protected]

Note to editors- about the methodology:

The Social and economic contribution of gold mining report provides quantitative insights into how large-scale mining, and specifically mines operated by World Gold Council (WGC) member companies, contribute to economic advancement and improve livelihoods at a global, national and local community level.

The report is based on 2020 data from 122 operations and 81 non-operating sites of WGC member companies across 38 countries. 31 of the 33 WGC members submitted data for this report.

Each company provided country-by-country information on payments to governments, employees, contractors, suppliers and communities. Payments related to both producing operations and non-producing operations, such as exploration activities, pre-operation development, closed mine sites and corporate offices.

Data was provided on an attributable basis – i.e. only including data for the share of the operation that they own. This was to ensure that there was no double-counting in the case of joint-ventures, but it does mean that the total figures under-represent the full contribution of the operations included where they are partially owned by companies or other entities who have not participated in this study. In submitting the data, companies were asked to follow the Guidance Note on Expenditure Definitions, as developed by the World Gold Council.

The data was then analyses by an independent research partner, Steward Redqueen.

Steward Redqueen used the Input-Output (I-O) modelling to quantify the socio-economic impact of gold mining operations. The method combines financial data from WGC members with macro-economic and employment statistics. The I-O model traces the local procurement expenditures by WGC members throughout the national economies in which they operate. This allows quantification of value added and employment supported by WGC members and their local supply chains.

The key ingredient of the I-O modelling approach is the Social Accounting Matrix (SAM). The SAM is a blueprint of the national economy and quantifies financial flows between economic sectors. It is a statistical and static representation of the economic and social structure of the local economy. More on the methodology can be found in the report, Appendix 1.

World Gold Council

The World Gold Council is the market development organisation for the gold industry. Our purpose is to stimulate and sustain demand for gold, provide industry leadership and be the global authority on the gold market.

We develop gold-backed solutions, services and products, based on authoritative market insight and we work with a range of partners to put our ideas into action. As a result, we create structural shifts in demand for gold across key market sectors. We provide insights into the international gold markets, helping people to understand the wealth preservation qualities of gold and its role in meeting the social and environmental needs of society.

The membership of the World Gold Council includes the world’s leading and most forward-thinking gold mining companies.

Sectors: Gold production