Bolivia: Indigenous rioting threaten Canadian mining company with nationalization
Bolivia will consider nationalizing Canadian miner South American Silver Corp's silver property, President Evo Morales said on Sunday, following violent indigenous protests against the mining project.
Morales, who last month took control of global commodities giant Glencore's tin and zinc mine in Bolivia, said he hadn't taken a final decision on whether to revoke the Canadian miner's concession.
”Nationalization is our obligation, I already raised the issue of nationalizing (the Malku Khota project) last year, and I told (local residents) to reach an agreement, because when they want we're going to nationalize,“ Morales told a farmers' gathering.
Exploration work, in which South American Silver plans to invest some 50 million dollars, is expected to end within three years. The company describes it as ”one of the world's largest undeveloped silver, indium and gallium deposits.“
A Bolivian man died and at least four others were hurt as protesters occupied the property, local media reported on Friday. An increase in social unrest and anti-government protests are testing Morales, the country's first leader of indigenous descent.
Mining is also coming under fire in neighbouring Chile and Peru, where many citizens feel they haven't profited from a metals-led economic boom.
Bolivian peasant farmers over the weekend released five local South American Silver workers, who had been held to demand the company leave.
Three of the hostages were freed on Saturday in a police operation and the other two were released on Sunday afternoon, sources said. A police officer held hostage since Thursday was also freed.
”There are no more hostages in Malku Khota, the last liberations happened due to negotiations,“ deputy interior minister Jorge Perez told state television.
The Erbol radio network said the engineers freed on Sunday were ”accused of spying and violating traditions or customs of the (local) peoples during an indigenous hearing.“ They were ordered to complete ”a community punishment” of making 1,000 adobe bricks before 30 days, the network reported.
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12 comments Feed
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www.soamsilver.com/july-8-2012-news-release.asp
National machosistic pride abounds in these LATAM countries, but their income per head of capita is well below that of the Falkland Islands. The inability of the LATAM countries to eat humble pie, and re-adjust the real world means they will continue to get shafted as less foreign investors are disuaded from doing the donkey work in discovering resources.
Pete,
Don’t tar us all with the same brush.
Credit rating agencies rating for different countries show the diverse level of risk across the continent. Chile at one extreme is rated as safer than most of Europe. Consequently there is an estimated $100 billion of foreign investment sitting in the pipeline.
They're pretty savvy about Latin American politics.
The mining business totally volatile and variable, but just a guess that SASC will be demanding a lot higher political risk premium for its Malku Khota play in Bolivia than for its Escalones site in Chile, given that the corruption perception index and rule of law is so much more favourable for Chile.
I agree with you. Bolivia is such a rich country bursting with natural resources, it wants for nothing except good leadership.
A fun fact; they are three times the size of Germany but their GDP is smaller than the market cap of Cencosud and Falabella. A couple of retailers. It's hard to believe.
It is hard to believe and tragic. The depth of poverty and the scale of it in Bolivia is truly horrible, especially on the Altiplano. It is depressing that they are sitting on all that wealth and the only thing stopping them from having good schools and hospitals is imbecilic policies brought about by entrenched political positions. They should get Paulmann up there to run the show.
To say its all merely a product of Bolivian poverty is a weak argument, given that Bolivia's Corruption Perception Index score of 2.8/10 is only marginally worse than Argentina's 3/10, and is better than Venezuela's 1.9/10.
Bolivia's Evo Morales re-elected coca growers' leader:
www.bbc.co.uk/news/world-latin-america-18768929
CPI 2011:
cpi.transparency.org/cpi2011/results/
SASC:
“South American Silver reaffirms its cooperation with Bolivian authorities and its strong support for the indigenous people of the Malku Khota communities in their continuing efforts to bring a timely and peaceful resolution to this situation,” said Greg Johnson, South American Silver CEO. “The company looks forward to a constructive dialogue with regional and national governments along with the local indigenous authorities after this situation is resolved in order to agree on an approach to development that is inclusive of all communities in the project area.”
The company continues to insist “the vast majority of the local indigenous communities living in the project area have signed multiple resolutions of support for the project and understand the potential social and economic benefits to their communities through the development of a world class, modern mine at Malku Khota.”
South American Silver said it has “temporarily ceased all field activities while government-led talks proceed to see a peaceful solution.”
www.mineweb.com/mineweb/view/mineweb/en/page32?oid=154705&sn=Detail&pid=102055
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