MINES AND THE POLITICAL ENVIRONMENT OF PERU

By Joseph Armenta
Staff Writer

Protests have erupted in response to an American-led mining project in the highlands of Peru. In November, disgruntled residents in Cajamarca, Peru took to the streets to denounce a proposal by Newmont Mining Corporation, a Colorado-based mineral extraction company, to build a Gold and Copper mine, called Conga Mine. As relations between the two parties intensified, the federal government stepped in to ease tensions. However, negotiations failed and President Ollanta Humalla instituted a state of emergency in December that sent federal troops into the region to quell the demonstrations. As the government’s actions were lifted in January, protests continued. In his most recent attempt to dissolve protests, President Humalla ordered Newmont to make some changes to its project, including a set of demands for the company to meet.

The underlying issue of the situation is concern over the region’s natural water sources. Residents fear that the project will drain and pollute the lakes and streams that much of the population depends on for its sustenance and agricultural needs. They are also concerned that runoff from the mine will have a drastic impact on the already fragile local environment, causing deforestation and bio degeneration.

A report published on Newmont’s website states, “the project has the potential to generate impacts on the environment,” but later concludes that “the envisaged mitigation measures, including the release of compensation flows from reservoirs, the effective containment of poor quality seepages through implementation of appropriate engineering measures, water treatment, and proper surface water and groundwater management, will allow adequate environmental protection.”

Activists are skeptical of the company’s ability to fulfill its promises given its spotty record in complying with international environmental restrictions. Newmont is one of the largest gold producers in the world and operates in various countries, many of which have had legal disputes with it. In 2009, Ghana accused Newmont of dishonesty when it tried to cover up a cyanide spill that polluted a lake. Later in 2010, the government of Indonesia pursued legal charges against the company for its alleged pollution of a body of water known as Buyat Bay.

Furthermore, Peru has also experienced many environmental disasters caused by foreign mining companies. One of the most famous examples occurred in 2000 when a truck carrying chemicals to the Yanacocha mine, located just south of the proposed Conga mine, spilled gallons of mercury onto a local village. The spill spawned protests after it poisoned over 1,000 people and had lasting environmental damage.

Despite these risks, the Peruvian government has been actively encouraging international mining companies to invest in the country. President Humalla ran on a platform of providing public programs and social services for the poor. But in order to fund these programs, the country needs a source of revenue. Thus, it has embarked on a largely successful campaign to attract as much foreign capital as possible into its realm. A recent article in the Peruvian newspaper El Comercio reports that mining investment has increased by 60 percent since last year, totaling over $1 billion in the first two months of this year alone.

Mining has contributed to the high economic growth rate of Peru in the past couple years. As a result of the most recent global financial crisis and the fluctuation of currency values, the price of gold is at a record high. This is largely due to the fact that when people cast doubts over the long-term stability of their currency, they turn to precious metals for assurance, creating a higher demand for gold. Newmont’s financial reports show record high revenues that amount to $10.4 billion.

The mine also plans to act as a stimulant for economic development in Cajamarca. It will do so by providing natives with alternative sources of income that offer more stable employment. However, the majority of people living near the proposed project site rely on small-scale agriculture to generate personal income. Knowing this, the issue regarding water becomes apparent. Agriculture relies on a steady source of clean water to harvest crops and maintain the upkeep of livestock. The fear of chemicals running off site into valuable water supplies brings about more than just concerns about environmental degradation amongst protesters. Activists are not radical environmentalists fighting for a green revolution. Rather, they are people invested in the land who are afraid of losing their endowments and sources of income. The thought of the proposed mine’s environmental impact threatens the stability of their future and interrupts their daily lives in ways that go beyond environmental protectionism.

Environmental conflicts similar to the Conga Proposal are at the forefront of political debates in many Latin American countries. The situations all follow a similar pattern: a progressive government will come to power with the intentions of building social institutions to cater to its poor base. At some point the new government comes to the conclusion that the export of raw materials are the only way to generate enough income to launch these social programs. Thus, they embark on heavy infrastructure projects that have spillover effects into local communities dependent upon fragile ecosystems to maintain their livelihood.

In Bolivia, a project set to build a highway cutting though the Amazonian basin ignited a nationwide protest, which resulted in thousands of people marching to the capital demanding an end to the construction. An agreement between Ecuador and China to mine in the Amazon sparked outrage amongst many Ecuadorians in March, which again, resulted in a nationwide protest. During the same month, thousands of protesters throughout Guatemala marched to the capital demanding their government place environmental restrictions against mining and damming companies in the country’s rural regions.

The protests in Cajamarca are only a part of a broader phenomenon of reactions against state-sponsored foreign investment. Many of the primarily indigenous communities throughout Latin America find themselves in an awkward position. On one hand, the extraction of raw materials is a dirty process that destroys the local environment and has a drastic impact on the natives’ livelihoods. On the other side, the proposed projects bring a source of income into the nation that can be dispersed to improve the quality of life of people throughout the country. Thus, reactions against mining projects are seen as the reaction against the wellbeing of the nation. The protesters become framed as a hindrance to development and are commonly referred to in a derogatory manor by other members of society. In the background of the tense societal relationship in Peru lies Newmont, a private company with interests that rest thousands of miles away from the conflict. What the Conga Project provides is an example of how decisions made to appease a private entity can affect the politics of an entire nation.

Moreover, social unrest in Cajamarca has little to with a green awakening seeking to uphold the preservation of natural ecosystems. Both Newmont and the protesters want to exploit the land for its resources in some form, whether it is for mining or agriculture. However the Conga Mine is also creating a mess out of the region’s political environment. It lies at the intersection of differing social imaginaries between multinational companies, a developing nation, and a way of life.

Image Courtesy of F e F e

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