The announcement of the new cabinet has generated a wave of speculation, both optimism and concern, around the way it will frame reactivation policies and the role the mining sector will play in it.
As we have seen above Confiep has welcomed Prime Minister Pedro Cateriano´s initial statements about the need to “unlock” large-scale investments that have yet to obtain the necessary social or environmental licenses, or both.
In one of his initial statements Cateriano declared that “this is a blessed country where nature has given us a wealth that we keep buried”. Cateriano is well remembered in the Arequipa region for imposing a state of emergency in the province of Islay in response to protests against the Tía María mining project when prime minister back in 2015. Unsurprisingly, civil society organisations have expressed concern about what he may bring to the table now.
Cateriano’s appointment is consistent with the pro-mining stand adopted by President Martín Vizcarra since well before the present crisis. As Moquegua’s regional president, he championed the Anglo American owned Quellaveco project. While the now former prime minister, Vicente Zeballos, had declared that the mining sector was non-essential and should go into lockdown, his decision was reversed in response to the outcry by business pressure groups. Large foreign-owned mining companies have since benefited from cheap loans under the Reactiva Perú program.
But on the specific case of Tía María, Vizcarra has consistently declared that the project will not move ahead until it obtains a social licence. This has been repeatedly denied by social organisations and authorities in the Tambo valley, in Islay province and in the Arequipa region more broadly. As recently as January he stated that the “conditions are not there” for the project to move ahead.
So what Cateriano will do about Tía María is a key question. On the one hand, the project involves an investment of around US$1.4 billion and some 7,150 construction jobs which would come in handy in terms of economic reactivation. It would also open the way for additional mining investments in the area, notably the Zafranal project, as underlined by Romulo Mucho, ex-vice minister of mining. On the other hand, local and regional social opposition persists unabated and Vizcarra´s own personal credibility and his relations with regional authorities in the south are at stake.
If the new minister of mines and energy, Rafael Belaunde, seeks to unlock Tía María, we will see if his skills as a consultant on mining issues, including in ‘community negotiation’ are good enough for the job. Belaunde, a grandson of the former (twice) president, is seen as someone who will smooth relations between Congress and the private sector.