Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Thousands of informal miners suspended their indefinite protest in the gold-rich Peru’s Madre de Dios region after three people were killed in clashes with police yesterday.
According to State-run Andina news agency, illegal miners’ representatives have agreed to meet with government officials on Monday.
“We are open to discussions … and we will search for a solution,” union leader Luis Otzuka said, reports Andina.
Informal miners have been protesting since beginning of March, demanding the government to revoke a new decree that regularizes small-scale and artisanal operations.
Under the new regulation, miners operating deposit illegally or breaking environmental rules now face up to 10 years in prison.
President of the Madre de Dios chamber of commerce, Roman Meza, said earlier last week that the demonstration was causing Peru loses of about US$560,000 a day.
“All businesses have been forced to close. Police surveillance is limited. The two most important markets have been closed. The miners threatened to take over the main road which would worsen the situation much more,” said Meza last week.
The polemic new law establishes a system to control and monitor chemical inputs used in illegal mining activities. It involves the involvement of a few state institutions. Tax agency Sunat will control tax and customs aspects; energy and mining investment regulator Osinergmin will oversee fuel sales, and production ministry will control chemical inputs.
The regulation also involves the armed forces and the public prosecutor’s office contribution.
According to Peruvian Times, illegal mining in the conflict area involves about 30,000 people, who earn more than five times the national minimum wage.
(Photo: Screenshot of a TV report showing Peruvian police throwing tear gas bombs at miners)
4 Comments
Cecilia_Jamasmie
I agree with Mrkhrdr on that “regulation” as opposed to “prosecution” is the key to try managing this complicated issue. Poverty is, without a doubt, the main driver for these people, who live in precarious conditions. However, along with their unregulated digging comes a trail of deforestation and chemical contamination that is damaging one of the most bio diverse regions on earth.
In addition to the negative environmental impact, there are also many social problems in the boom towns that have emerged in the region.
In October last year, for example, about 200 women and girls were rescued by police from brothels in Madre de Dios.
And, while there is not evidence of informal gold mining in Peru being run by criminal organizations in the same way that Colombia (mainly by the Revolutionary Armed Forces of Colombia (FARC)), there is a link.
Security analyst Ruben Vargas told Andina that there were “undeniable ties” between illegal mining and drug trafficking in Peru, and that traffickers used the business to launder their profits.
Mrkhrdr
Just say no, you shall not pass. That’s a strange concept of “regularization” to my ears. How about “regulation”? Recognize the fact that an opportunity to earn 5x the minimum wage working for yourself is not going to be turned down in a country full of poor folks with no future otherwise. So minimize the environmental damage: allow and require claims to be filed, keep records, enforce environmental laws – ban mercury, cyanide, and other toxic chemical use by small miners. Oh, yeah I just thought of one big hitch: government workers on the take all over the place. Bribes to expedite paperwork, bribes to look the other way… The mind reels. Too bad.
Bill Jackson
The use of mercury to recover gold, followed by boiling the mercury away to leave a d’ore mass is dangerous to the environment and to the worker. Why do they do it? To get the gold as a cashable item to the thieves who buy the d’ore now. The only way to stop it is to put an easier cash method in front of the worker. The thieves who prey on the workers and buy their d’ore for half price do not want it. The government would take more than the thieves now take in terms of taxes etc., so this problem can only be solved by government purchasing agents who pay full value to the worker, and the government must accept the general betterment of the economy and the workers lives as their “tax”, in other words, do not steal. The government is a sea of thieves as well, and they have soldiers, so I see little hope of change?
3051001
Mrkhrdr – you forgot the main reasons – miners do not want to follow laws, do not want to do as they are told, they want what they want – $$$ – I have worked with these people trying t educate and show better ways to do things. If it requires extra work or cost it generally doesn’t happen – sad but true