Use of metals is growing steadily, especially in emerging economies, with global metal ore extraction tripling to 7.4 billion tons between 1970 to 2010. 54% of this was used in the five BRICS (Brazil, Russia, India, China and South Africa) countries. Metals are a key enabler of economic development and human progress, and a requirement for the expansion of clean energy.
The increasing use of metals, however, has also caused problems. Mining and smelting are polluting processes, causing local pollution and land-use change. It creates approximately 10% of total global greenhouse gas emissions and 8% of global energy demand, and access to ore is increasingly restricted by the geographical concentration of mines, environmental concerns about extraction, and deteriorating grades of metal ores.
Although the majority of metals are infinitely recyclable in principle, the recycling process is often hampered by social behaviour, product design, lack of separation and sorting facilities, and inadequate technologies.
Affluence measured as per capita gross domestic product (GDP) has been identified as the main economic driver of domestic metal use, but reaches a plateau when gross domestic product reaches US$15,000 per person, suggesting an increasing resource efficiency in high-income economies. Indeed, the environmental Kuznets curve (EKC) hypothesis, tested using panel data, cross-sectional data and single-country samples, postulates a peaking and eventual decline of metal use over the course of economic development.
Researchers have highlighted that the sole consideration of domestic metal use can lead to misleading interpretations of national metal demand, with studies showing decoupling of material use from economic growth in some consuming countries to be overestimated, as resource-intensive industries are outsourced to other countries.
A correction for this inaccuracy is possible with the use of global multiregional input–output (MRIO) models that are able to allocate the use of production factors through trade to final consumption. The metal footprint (MF) based on MRIO models accounts for the supply-chain-wide use of metal ores associated with the domestic final demand of a country or region. A cross-sectional analysis of the MF of 186 countries in 2008 found an elasticity of 0.9 – that is, a 1% higher GDP per capita was associated with 0.9% higher MF per capita. However, cross-sectional analysis provides only a snapshot of a specific point in time. Panel analysis of time-series observations of the same cross-section can detect both time and individual variations that are unobservable in cross-sections, and hence gain more confidence about the cause-and-effect relationships.
While researchers have performed panel analysis on domestic metal use, statistical analysis of MF has so far been limited to cross-sectional analysis. This paper presents a quantification of the annual metal footprint – the amount of metal ore extracted to satisfy the final demand of a country, including metals used abroad to produce goods that are then imported, and excluding metals used domestically to produce exports – for 43 large economies during 1995–2013, using the newly established EXIOBASE 3.3 MRIO data set.
Using a panel analysis approach to assess short-term drivers of changes in metal footprint, the authors test the elasticities of per capita MF with respect to various explanatory variables (that is, the percentage change in per capita MF in response to a 1% change of explanatory variable(s)).
The explanatory variables include GDP per capita adjusted for purchasing power parity (the affluence level), share of GCF in GDP (investment rate), the share of industry value added in GDP (reflecting the structure of the economy), urban population share, population density and domestic ore extraction (reflecting domestic resource availability). The authors also tested whether the MF– GDP relationship varied at different affluence levels, during economic expansions and recession, and with the composition of final demand.
The authors found that a 1% rise in gross domestic product raises the metal footprint by as much as 1.9% in the same year. Further, every percentage point increase in gross capital formation as a share of gross domestic product increased the metal footprint by 2% when controlling for gross domestic product. It concluded that other socioeconomic variables did not significantly influence the metal footprint. Finding ways to break the strong coupling of economic development and investment with metal ore extraction may be required to ensure resource access and a low-carbon future.