The impact of mining projects on household livelihoods in the Benishangul-Gumuz Region, Ethiopia

The recent changes in mining policy in Ethiopia have led to a significant increase in mining investments in regions rich in minerals. One such region is the Benishangul Gumuz regional (BGR) state, which has attracted both domestic and foreign investors interested in extracting coal, marble, and gold. However, there is a lack of studies on how mining projects in Ethiopia, particularly in the BGR state, affect the livelihoods of households. This study aims to address this gap by examining the impact of mining projects on household livelihoods in the BGR. To achieve this, we employed quasi-experimental and cross-sectional research designs and collected primary data from 333 households. This included 162 households located near the mining projects (treated households) and 171 households in areas without mining projects (control households). For the analysis, we utilized principal component analysis (PCA) and propensity score matching (PSM) techniques. We used the sustainable livelihood framework (SLF) as the conceptual and analytical tool, focusing on the five livelihood assets as the outcome variable of the study. The results of the Average Treatment Effect on the Treated (ATT) revealed that mining has a significantly positive impact on the financial and physical assets of households. However, it also has a notable negative impact on human, natural, and social capitals, which are crucial for the sustainable development of rural households. Therefore, the research recommends that government institutions and policymakers should address these challenges using a comprehensive approach that balances the benefits of mining with the preservation and enhancement of necessary community assets.