Determinants of Foreign Direct Investment in the Mining Industry

  • Vlado VivodaEmail author
Part of the The Political Economy of the Asia Pacific book series (PEAP)


A range of social, political, and economic factors determine where mining companies invest their scarce capital. This chapter identifies nine areas of risk that investors need to consider before investing in the sector. These include high sunk costs, the finite life of a deposit, and the long period to achieve a positive financial return. Add to this, legacy issues and it is clear that mining is a high-risk venture. This chapter argues that increased attention to the nine areas of risk may benefit mining companies in the future.



Bilateral investment treaty


Extractive Industries Transparency Initiative


Environmental Performance Index


Foreign Direct Investment




Geographical Information System


Guided Uniform Criteria Assessment System


International Centre for the Settlement of Investment Disputes


Internal Rate of Return


SNL Metals Economics Group


Non-governmental Organisation


Net Present Value


Prime Minister’s Science, Engineering and Innovation Council


United Nations Conference on Trade and Development


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Copyright information

© Springer International Publishing AG 2017

Authors and Affiliations

  1. 1.Centre for Social Responsibility in Mining, Sustainable Minerals InstituteThe University of QueenslandSt LuciaAustralia

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