Risk and International Environmental Policy: Emerging Issues for the Minerals Sector

Environmental policy is evolving rapidly in the international arena with an increasing number of multilateral environmental agreements being negotiated in a range of forums. The issue of risk management has figured prominently in these processes, with the OECD risk reduction strategy for lead and the Basel Convention being two recem examples of particular relevance to the minerals sector. A common feature of these recent developments is the lack of an economic dimension when considering risk reduction measures at the international level. While considerable effort is being put into the scientific aspects of risk management, relatively little attention has been paid to the economic issues involved in risk reduction. Yet economic concerns are likely to be central to the successful adoption of intenational risk management measures. This is because any policy changes dealing with risk reduction email economic costs and benefits which are unlikely to be evenly distributed across countries. Failure to fully understand and address these economic aspects may result in the introduction of less than optimal policies or the rejection of sensible environmental protection strategies. In this paper, some of the key economic issues involved in the management of risk at the international level are reviewed together with the implications for the development of international environmental policy. The need for economic analysis to assist decision makers in fully understanding the range of implications of potential policy changes is illustrated through a case study of the OECD risk reduction strategy for lead.