In a report, Rio Tinto was accused of “illegitimately lowering” its withholding taxes paid to the government of Mongolia in relation to the Oyu Tolgoi copper mine. Rio allegedly did this by using a double tax agreement between Mongolia and the Netherlands, in addition to which it negotiated an even lower rate of withholding tax in its amended mining agreement in 2011. This piece reviews Rio’s tax arrangements.
NRGI offers global and regional courses (both in-person and online) that are tailored to civil society advocates, government officials, journalists, parliamentarians and other actors who are working to improve the management of oil, gas and minerals.
Resource-rich countries tend to experience slower economic growth and more social problems than do less-endowed countries—a phenomenon dubbed the “resource curse.” But it turns out that in many cases, economic growth begins to underperform long before the first drop of oil is produced; this we call the “presource curse.”
Resource-rich Latin American countries did experience high rates of economic growth and diminished poverty and inequality during the boom years. On the surface, this would appear to strengthen arguments that extractive industries are key to progress, especially in resource-rich areas, despite their negative environmental impact. Nevertheless, a closer look shows that things are a bit more complicated.