ABSTRACT
In the mid and late 1960s, the Zambian government captured a very high proportion of mining company profits, reducing the expected rate of return below that required to attract new investment. That rate was certainly high, reflecting the degree of risk attached by foreign mining companies to investment in Zambia. The foreign mining companies encountered in the case studies did display a tendency to purchase goods and services from suppliers of proven reliability, which frequently meant suppliers from their home countries. The geographical location of mineral deposits in Australia, Papua New Guinea and Zambia meant that its impact in this regard was highly localised. Foreign-financed mineral development did create or help to create problems of economic management, but the outcomes were not perceived by host country authorities as resulting from avoidable actions by the companies concerned. Australian governments over-estimated the likely extent of direct economic benefits from mineral development.
