Global Corporate Intelligence: Opportunities, Technologies, and Threats in the 1990s

By George S. Roukis; Hugh Conway et al. | Go to book overview

uation. Thus, while energy may be a limiting factor locally, the long-term supply of it poses no big problems. Water conservation measures in operation should insure the supply required for mining purposes. Indeed, columbium mining uses mainly recycled water, with additions from a nearby lake. Labor relations in the mining industry are very good, but the work force is comparatively small because a high degree of mechanization has been achieved. Brazil, therefore, appears to be taking its place as one of the major mineral-source regions of the world, and with a more developed transport network, there would appear to be few impediments to its exportation of strategic minerals to the United States.

Government programs dominate the mining industry. A National Prospecting Program has been set up to oversee the development of the mineral industry. While state-owned companies account for about 70 percent of economic activity, government companies account for only 20 percent of total mineral output. The remainder is shared more or less equally between private Brazilian and foreign companies. Government policy can be described as supportive and is particularly active in metallurgical research and development of technology. However, mineral output accounts for only just over 2 percent of the GNP, and while future prospects are excellent, the economy is largely supported at present by other sectors. The mining industry in Brazil is in a strong position.

The fact that such a high percentage of columbium supplies to the United States have their origin in one small isolated area of Brazil must pose problems of vulnerability. In the total mineral portfolio of the United States, this is the most extreme case of concentration, since even in the medium term there appear to be no alternatives. Thus the effects of any constraint on supply, ranging from labor disruption to natural catastrophes, will be considerably magnified.

It can be concluded that geography furnishes a key element to be taken into consideration in any corporate risk assessment. However, owing to the all- embracing nature of the discipline, it is necessary to dissect it into its component parts and to consider each of these on a variety of scales. Unless geography is deliberately factored into the assessment in this fashion, its significant role may remain obscured. As a result, only a partial picture of the attendant risks will emerge.


NOTES
1.
C. De Vore, "Strategic Minerals: A Present Danger," Signal, January 1981, 63- 68; P. Seabury, "Industrial Policy and National Defense," Journal of Contemporary Studies, vol. 6, no. 2 ( 1983): 5-15; E. W. Anderson, "Factors Affecting the Supply of Strategic Raw Materials with Particular Reference to the Aerospace Manufacturing Industry," in NATO, Materials Substitution and Recycling ( Paris: NATO Advisory Group for Aerospace Research and Development, 1984), 2.1-2.20; D. James, ed., Strategic Minerals: A Resource Crisis ( Washington, D.C.: Council on Economics and National Security, 1981).
2.
E. W. Anderson, "The Need to Safeguard the Supply of Strategic Minerals to theWest,"

-245-

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