This article argues that if public policies designed to stimulate clusters incorporate social and environmental concerns they are likely to have a relevant role in improving the performance of small scale gem mining in Brazil. This argument is based on empirical studies of the social and environmental problems faced by the opal cluster in Pedro II, Piauí state. The research has been developed as a case study, including an extensive literature review, consultation of official documents and reports, and interviews with key stakeholders. The results suggest that some issues are limiting the development of the cluster, including labour conditions and remediation of environmental impacts. Nevertheless, there are indications that such problems could be corrected, depending on human resources, money and political will. On the other hand, it is also argued that if decision makers desire to make this cluster really sustainable, they will have to debate a second group of issues, such as balance between different actors of the production chain, economic activities that could substitute mining in the case of resource shortage, redistribution of tax revenues and redesign of licensing procedures.
cluster; mining; gems; local development