The Mining Sector Diagnostic (MSD) is a diagnostic tool that is used to comprehensively assess a country’s mining sector. The tool analyzes primary data (the country’s documented laws, rules and regulations) and interview data (from in-country interviews with stakeholders from government, industry, and civil society) to clearly identify the mining sector’s relative strengths and weaknesses. The results can be used by governments, World Bank teams and development partners as a basis for policy dialogue and to identify areas of targeted support and assistance.
The MSD is a key tool used to support our mission to help developing countries build strong mining sectors that drive growth and reduce poverty.
To learn more about the Mining Sector Diagnostic, please find an overview here.
Reports on Colombia and Indonesia’s mining sectors now available
Using the Mining Sector Diagnostic (MSD) tool developed by the World Bank, comprehensive assessments of the mining sectors for two countries—Colombia and Indonesia—are now publicly available. The results of an MSD can form the basis for a policy dialogue and sector reforms that build a vibrant mining sector, contributing to inclusive growth, poverty reduction and shared prosperity.
Colombia: driving new mining policy
The Colombia MSD provides a detailed assessment of strengths and weaknesses - particularly around how to address mining governance challenges and leverage mining’s contribution to sustainable development. The MSD found that an integrated environmental-mining regulation would reinforce sustainability practices in the mining sector. At the same time, Colombia needs to develop a comprehensive policy for artisanal and small-scale mining (ASM). The MSD’s proposed reform agenda has now informed the country’s National Development Plan 2018-2022, including its mineral production diversification strategy.
Indonesia: improving the impact of mining on local communities
The Indonesia MSD, conducted in the context of a broader country engagement, brought stakeholders together to build a mining policy reform agenda and address issues in mining management. While mining tax administration is a key strength in the country, Indonesia needs to consult more with local communities, monitor and mitigate against environmental and social impacts and improve public disclosure and dissemination of information. All stakeholders have now come to an agreement on how to use this information effectively within the Natural Resource and Governance Initiative, funded by the Government of Canada (DFATD) to ensure more effective natural resource governance.
Below please find reports and data for the Mining Sector Diagnostic assessments that have been completed to date.
1. What is the Mining Sector Diagnostic (MSD)?
The MSD is a diagnostic tool designed to comprehensively assess a country’s mining sector. It relies on verifiable information from government, industry and civil society to identify relative strengths and weaknesses of a country’s mining sector, as well as those areas most crucial to the effective functioning of the sector. A wide range of stakeholders can use MSD to inform dialogue and engagement across government, the private sector and civil society, while also identifying which reforms are necessary in that country.
2. Who benefits most from MSD?
The diagnostic is designed primarily for governments, but is also beneficial for a variety of others, including the private sector, civil society, development practitioners, and academia.
3. Is an MSD appropriate for any country?
The World Bank can conduct an MSD for any country, when requested by the government and where data is available. The Bank has already assessed the mining sectors of a range of countries, including low-income countries and lower- and upper-middle income countries. MSD is applicable to mature mining countries as well as countries in which the mining sector is in its infancy. It can also be used in countries where responsibility for mining regulations rest with sub-national levels of government.
4. How is this MSD different from existing indices or benchmarking exercises?
MSD is not an index and is not based upon perceptions. It is a data-driven exercise, yielding information on a mining sector’s relative strengths and weaknesses, as well as those areas most crucial to effective functioning of the sector. Sector performance is assessed against internationally accepted “good practice” as defined by the Extractive Industries Sourcebook.
5. Is MSD meant to provide a point of comparison across countries?
MSD focuses on each country individually and does not compare countries. Specifically, it does not “rank” countries or assign an overall performance score.
6. Will MSD reviews be publicly available?
Yes - a descriptive report is produced for each country’s MSD. The reports (together with the underlying data) are published on the World Bank’s website, once they are peer-reviewed and shared with government.
7. Have other organizations been involved in the development of MSD?
MSD was developed by the World Bank with input from several organizations and individuals. A pilot version of the tool (at the time called “The Mining Sector Investment and Governance Review”) was developed by Adam Smith International and the Natural Resource Governance Institute in close cooperation with the World Bank and outside experts. The current and final version of MSD was produced by the World Bank with input from the Intergovernmental Forum on Mining, Minerals, Metals and Sustainable Development (IGF).
8. How does MSD relate to the Africa Mining Vision and the IGF’s Mining Policy Framework (MPF)?
MSD is complementary to both. The World Bank believes Africa and individual countries should set their own visions and strategies for mining. The MSD helps contribute to government deliberation and planning on mining sectors.
9. What is the MSD methodology?
The MSD is a data-driven exercise that combines primary and interview data. Primary data (e.g., information on existing rules and regulations) is gathered through research and interview data (e.g., information on actual practice and stakeholder experiences) is gathered through in-country interviews with government, private sector, and civil society representatives. The World Bank combines this data into indicators and analyzes sector strength and weaknesses as well as implementation gaps. To the extent possible, indicators are designed to be actionable by country governments, fact-based, and verifiable.
10. Who finances the MSD?
Current funding for the MSD is being provided by the German Federal Institute for Geosciences and Natural Resources (BGR), and the Extractives Global Programmatic Support (EGPS) Multi-Donor Trust Fund. Individual country assessments are financed through Bank funds and/or existing MSD funding.
11. Have any MSDs been instrumental in informing government reforms and regulations?
The World Bank uses the MSD to inform its ongoing dialogue and engagement with government, but the MSD is also a resource for the broader audience including governments, industry and civil society.
12. Will MSDs be periodically updated?
The World Bank is available to update MSDs upon request. A country that has undergone an initial MSD may find it helpful to undergo a second assessment, once targeted interventions have been implemented and time has passed to assess impact.
Information on good policy practices in natural resource management can be found in a variety of sources:
Frameworks of mining governance
Natural Resource Charter (NRC), 2nd edition
Methodologies of evaluating mining governance
Voluntary and mandatory principles