A year of environmental policy: little to celebrate

05 August 2017

To mark President Kuczynski’s first year in office, the influential NGO, Cooperacción, looks back at a year of environmental policy-making and finds few reasons to celebrate. The core of the government’s approach to stimulating mining investment appears to be the reduction of standards and controls.

Cooperacción lists seven items of policy, or their absence. Four are instances of reduced levels of control or associated penalties (lower air or water standards, the reduced need for environmental studies in some circumstances, lesser penalties for illegal mining). Three more concern institutional roles of the Environment Ministry (Minam): its exclusion from territorial regulation and the management of reconstruction, and its replacement by the Economy and Finance Ministry (MEF) as the national authority relating to use of the UN Green Fund (the principal UN source funding work to mitigate climate change).

Following on from this review, Cooperacción posits that the whole approach is based on a complete misreading of what really deters investment in extractive industries. The real problems, as cited by Cooperacción and based on the Central Banks’s IV Mining Survey (Encuesta Minera) of December 2016, are international prices, corporate strategies, rising costs and maintenance problems – plus ‘social conflicts’ arising mostly from inadequate management of environmental and land issues.

The approach criticised here will be further strengthened by the failure last week to get any bids for the La Oroya smelter on the third time of asking. The Director of Dirige, the consulting firm charged with getting a contract under way, says investors are still worried by the lack of clarity on responsibility for remediation of past environmental damage

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