Investigating the Environmental Effects of Minerals Production and its Role in Sustainable Development

Mining and processing of minerals has always been associated with high environmental impacts. Sustainable development is impossible without paying attention to environmental conditions; therefore, the present study aims to investigate the environmental effects of minerals and the role they play in sustainable development. For this purpose, generalized Dickey-Fuller unit root test was used for reliability of variables and two-way Granger causality test was also applied to examine the bidirectional causality between variables using time series data associated with 1991-2014. Then ordinary least squares method (2SLS) was used to estimate simultaneous equations. Given the findings of the study, the effects of minerals production coefficient on gross domestic production is positive and significant. However, the effect of copper ore and coal was higher in increasing gross domestic production compared to other variables. Coefficient of CO2 emission in tons was negative and significant associated with gross domestic production. Moreover, coefficient of gross domestic production and governmental expenses to protect environment were calculated positive and significant. The results indicated that there is a mutual causality between minerals production and environmental pollution due to their production. Considering that CO2 emission affects gross domestic production significantly and negatively, it can be concluded that reduction in gross domestic production is due to mining environmental pollution. Moreover, the effect of gross domestic production and governmental expenses for environmental protection on environmental pollution id positive and significant which means that environmental degradation leads to high expenses for the government as well as low levels of gross domestic production. Therefore, development of a comprehensive plan along with strategic policies will be required to protect environment and optimize mining processes so that minerals production can be increased, while the environment is protected against destruction and sustainable development becomes possible along with economic growth of the country.