Implications of Chinese overseas mining operations for community-level social conflict

Abstract

In the context of increasing foreign mining activities and their impacts, and the growing number of social conflicts resulting from mining operations, this paper investigates whether Chinese multinational corporation (MNC) investment is positively associated with social conflict, and if so, whether that relationship is a result of MNC practices, and/or other factors. Broadly speaking, scholars paint a picture in which China's political regime together with its national culture and its economic development path influence Chinese extractive MNCs’ activities abroad and might contribute to more social conflict. At the same time, scholars writing on extractive conflicts have argued that conflicts result from companies’ inadequate performances, especially regarding community engagement practices. That is, in this second view, social conflict is due to mistakes that any company could make; that is, there is no “Chinese way” of operating abroad. The paper asks: Are Chinese mining MNCs’ operations more prone to social conflict than non-Chinese MNCs’ operations? If so, how? To what extent do firm practices explain variation in conflict? Through quantitative and Geographical Information System (GIS) analysis of an original database of 1001 mining properties worldwide, this paper finds that Chinese MNCs do not confront more conflict than other foreign-owned MNCs. This finding has theoretical contributions as the results that Chinese mining MNCs do not perform worse threaten to falsify much of what has been discussed about Chinese mining firms, that they behave worse and cause conflict. The study contributes to our understanding of extractive conflict, with implications for the trajectory of extractive sectors and, in turn, alternative or sustainable development options.