Chinese mining standards come under scrutiny

18 February 2017

In view of the declaration of a state of emergency for 30 days in Cotobambas (see recent PSG article), a seminar organised by the Congress (in conjunction with Cooperacción, Oxfam and IISCAL) on 17 February provided a timely opportunity to discuss the environmental and social standards applicable to Chinese investments in Peru.

According to Paulina Garzón, director of IISCAL (Iniciativa para las Inversiones Sustentables China – América Latina), these standards constitute a 'win-win'instrument, providing communities with the opportunity to protect their rights, the government the chance to strengthen social and environmental protection, and for Chinese banks and companies to reduce their financial risks and enhance their reputation.

However, such standards involve both strengths and limitations.

Among the limitations is the almost complete absence of public awareness of such standards, the paucity of instruments to monitor fulfilment, and the fact that such standards are not implemented in some instances because they are not laws as such (and therefore legally binding).

At the same time, the recognition that social and environmental impacts are not just the responsibility of countries receiving investments is a plus, as is the increased level of commitment towards implementing such standards.

Emily Greenspan from Oxfam underlined the importance of sustaining public participation throughout the whole life of a project, in particular Free, Prior and Informed Consent. Although the guidelines provided by the International Council on Mining and Metals (ICMM) suggest that national government should have the last word on whether or not a project goes ahead, Greenspan stressed the need for the local population (both men and women) to have their voice heard. Traditional knowledge should be included in the design of mitigation measures and in community development.

China is Peru’s main trade partner and its most important source of investment. This, in itself, underscores the need for greater collaboration between the two governments and companies involved in implementing such standards in effective ways.

But, as many of those present at the seminar from both Cotobambas and from Morococha in Junín (a community close to the Chinese-owned Toromocho mine) were swift to point out, there is a wide gap between the publication of standards and their implementation on the ground. They claimed that they had suffered major social and environmental impacts, and had benefitted little from the development of these massive mining operations.

The problem therefore seems to lie not just with international standards (however enlightened) but with the Peruvian state and its ability to monitor, regulate and enforce such standards. As Richard Arce Cáceres, the Frente Amplio congressman for Apurímac who opened and closed the seminar, put it “the state has to play the regulatory role”. Or as Efraín Arana, who advises the congressional committee on indigenous affairs, noted “the instruments we have [for regulating mining investment] don’t work”.

(A report on the seminar was provided to us by Gabriel Arrieta, for which we are very grateful. The above uses his material.)

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