The Americas
Americas view
Natural resources in Peru
The trials of miners
Jun 30th 2011, 11:33 by L.C. | LIMA
SINCE early May protests have simmered in Puno, a large and fairly poor department in southern Peru. They offer a warning to the country’s newly elected president, Ollanta Humala. The ostensible target is a silver mine being developed since 2007 at Santa Ana, in the high Andean plateau close to the border with Bolivia, by Bear Creek Mining, a Canadian company. The local communities favour the mine. But some in the nearby towns along the shore of Lake Titicaca do not. They blockaded the city of Puno, the regional capital, ransacking public buildings and private businesses, demanding the cancellation not just of Santa Ana but of all mining and hydrocarbons concessions and planned hydroelectric dams. On June 24th a stone-throwing crowd of several thousand tried to take the airport at Juliaca; five people were killed by police bullets.
The outgoing government of Alan García backed down. It rescinded Bear Creek’s concession, ordered a clean-up of two rivers polluted by mines, and declared that all mining and hydrocarbons concessions must receive the prior consent of local communities, in concordance with a law approved by Congress but previously vetoed by Mr García. The previous week the government cancelled a $4 billion hydroelectric plant proposed by a Brazilian consortium at Inambari. In April it rescinded a concession for a $950m copper project near Arequipa.
All this has thrown doubt over the future of extractive industries in Peru, the main motor of the country’s rapid economic growth (averaging 7% a year for the past five years). Planned investment in mines, oil and gas and hydro-electricity totals $51 billion over the next five years. But how much of this will now happen?
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