On Wednesday, during a one day visit to Peru, Canadian Prime Minister Stephen Harper announced a new aid package aimed in part at helping regional governments more effectively reinvest taxes and royalties from mining in programs to alleviate poverty.
During the first official visit to Peru by a Canadian prime minister, Harper met with executives from Canadian mining companies before meeting with Peruvian President Ollanta Humala to reveal the new $53 billion aid package. The package, which more than doubles Canada’s aid to the Andean country, includes funds to develop mechanisms to more efficiently and transparently allocate the $4 billion regional governments have amassed in unspent royalties.
Humala, who campaigned on a platform of social inclusion and poverty eradication, imposed the mining royalties as part of that commitment. But that money lies idle in government bank accounts, while half of Peru’s rural population continues to live below the poverty line and violent anti-mining protests have sprung up.
Canada has a large presence in Peru’s mining sector. Currently 75 Canadian mining companies are engaged in gold, silver or copper exploration throughout Peru.
Canada’s increased investment in Peru is part of a broader initiative rolled out by the Canadian government in fall 2012 to ensure that Canada’s federal spending goes toward efforts that boost the country’s commercial interests and to encourage investment in socially and environmentally responsible industries.
Amid continued crackdowns on anti-mining protesters and growing social unrest, Prime Minister Oscar Valdés stepped down yesterday as part of President Ollanta Humala’s cabinet reshuffle. Valdés, a former army officer, assumed office in December 2011. Two government sources said the president would likely pick as Valdés’ successor Justice Minister Juan Jimenez, a human rights lawyer who has already replaced Valdés in dealing with many controversies.
Valdés tweeted his resignation, thanking friends for their “support and constructive criticism.” In keeping with Peru’s constitution, all other cabinet ministers also offered their resignations. While some, like Finance Minister Luis Miguel Castilla, are likely to be reappointed, Interior Minister Wilver Calle is also expected to be replaced.
Promoting Jimenez may help Humala counter the argument that his government has taken a militant approach toward civilians protesting major mining projects, including the $4.8-billion Minas Conga project operated by the Minera Yanacocha consortium (led by U.S.-based Newmont Mining) in the northern Cajamarca region, where clashes have already led to the deaths of five civilians this month. The conflicts have largely erupted over environmental concerns, with anti-mine protesters contending that mining operations will lead to water, air and agricultural contamination. Regional government leaders who have led the protests also say Humala has turned his back on the rural poor, who largely voted for him in last year’s presidential election but have benefited little from mining activities in their communities. President Humala has said that the Conga project will move forward as long as the company meets certain requirements aimed at mitigating its environmental impact, including ensuring that water in the surrounding area is both available and of good quality.
Oscar Valdés’ predecessor, Salomon Lerner, resigned after five months of serving in the Humala administration. His departure was also precipitated by social unrest, which at that time caused President Humala to declare a state of emergency in the province of Cajamarca.
Humala’s approval ratings fell to 40 percent in July, according to the Ipsos Apoyo survey—down from a peak in February of 59 percent. Analysts attribute the decline in popularity to the growing discontent and social unrest that has claimed the lives of 15 people since Humala took office. The president is expected to deliver a nationwide speech marking his first year in office on July 28.
On Thursday, 1,000 activists arrived in Lima to demand the end of millions of mining operations that they claim are contaminating water and causing pollution. Their nine-day protest began last week in Peru’s northern region of Cajamarca but has now moved to Lima after a journey by bus and foot. Marco Arana, one of the leaders of the protest, said “we are demanding that all mining activities at the source of water basins be prohibited.”
Arana, leader of the left-wing movement Tierra y Libertad and who supported Humala during his electoral campaign, said that “we have to make a decision to choose between mining and water.”
Peru has 200 outstanding social conflicts, the majority of which relate to fears of environmental damage caused by the country’s mining industry--estimated to represent $50 million in investment in coming years. The anti-mining movement has united leaders from disparate mining regions who have distanced themselves from President Ollanta Humala in their “war for water.” Some protests have achieved their goals: in November protesters were able to paralyze the project in the Conga mine under the administration of Newmont, a U.S.-based company.
Analysts fear the eruption of violent protests, which could disrupt up to 60 percent of Peru’s mining exports. Protest leaders will meet members of Congress today to present a legislative initiative that seeks to suspend mining activity.
From Americas Society/Council of the Americas. AS/COA Online's news brief examines the major—as well as some of the overlooked—events and stories occurring across the Americas. Check back every Wednesday for the weekly roundup.
Brazil’s Senate Passes Forest Code Bill as Amazon Deforestation Declines
On Monday, Brazil’s Senate passed a controversial forest code bill with overwhelming support. The bill alters an existing forestry law, and would increase the amount of forest farmers can legally cut down. It would also offer amnesty to those who illegally deforested land before 2008. The bill must pass the Chamber of Deputies before being submitted to President Dilma Rousseff, but still faces still opposition. Environmentalists have rallied support against the bill, and a Folha de São Paulo report today reveals that 50 congressmen received $8.3 million in campaign donations from agribusinesses that would receive amnesty under the new law.
Coincidentally, Brazil’s National Institute for Space Research reported this week that deforestation in the Amazon rainforest in 2011 reached its lowest level ever recorded since 1988. Between August 2010 and July 2011, Brazil lost 6,238 square kilometers of rainforest, 11.7 percent less than the same period last year.
Brazilian Labor Minister Steps Down
Brazil’s embattled Minister of Labor Carlos Lupi resigned on December 4, becoming the seventh member of President Dilma Rousseff’s team to step down since she assumed office, and the sixth on account of corruption. Brazilian press accused Lupi of diverting taxpayer money to NGOs, an accusation he repeatedly denied. In his resignation, he stated: “I leave with the clear conscience of a duty fulfilled, of my confident, personal belief that the truth always prevails.” Hoping to avoid another political crisis, President Rousseff also called on Fernando Pimentel, minister of Development, Industry, and Foreign Trade, to discuss his time as a consultant between 2009 and 2010. Brazilian newspaper O Globo suggested he may be involved in influence peddling and non-payment of services rendered.
Read an AS/COA Online hemispheric update about the Rousseff administration’s attempts to rein in corruption.
State of Emergency Declared in Peru Amid Mining Protests
On Saturday, President Ollanta Humala announced a 60-day state of emergency following large-scale protests against Peru’s largest mining project in the Cajamarca province. Residents oppose the $4.8 billion Conga mine, operated by American company Newmont Mining, since they believe it will cause environmental damage and contaminate the water supply. The state of emergency permits arrests without warrants. On Tuesday, police arrested two protest leaders; Wilfredo Saavedra, head of the Environment Defense Front of Cajamaraca, and Milton Sanchez, the head of a civic association were questioned and detained for 10 hours.