Critical minerals are essential for the OECD Members’ green and digital transitions. However, unstable supply chains, heavy concentration of critical mineral processing capacities and the potential for considerable environmental damage caused by a mining surge are all challenges which OECD Members will have to address in order to ensure an efficient but sustainable double-transition. In this respect, Central Asia is a case-example of these new hurdles: the region’s landlocked geography and its proximity to several countries under international sanctions (Russia, Iran, Afghanistan) makes the potential development of new critical mineral supply chains more problematic than in other regions, while an increase in mining would exacerbate environmental issues in an already vulnerable region (drying up of the Aral Sea in the past and of the Caspian Sea in the present, desertification, glacier melting).
The development of mining industries will involve the attraction of international investment, thus generating another set of challenges related to the adaptation of domestic legislations to foreign participation in mining projects, the evolution of existing labour norms and practices to more sustainable mining standards and the upgrading of existing fiscal policies to make sure that the countries concerned benefit from the economic activity on their soil. Here as well, Central Asia is an essential case study for critical mineral policy as the domestic mining industries suffered from under-investment following the countries’ independence, making the aforementioned challenges still relevant and acute.
This policy paper will dive into the current situation in the mining sector in Central Asia as part of the OECD Critical Minerals Initiative, and on the basis of previous OECD work on mining and critical minerals in the region. While studying a specific region, the paper will nevertheless attempt to situate Central Asia’s mining sector and its challenges within a more global context of increased strategic importance of critical minerals.