In Peru, President Ollanta Humala has courted large foreign mining companies and focused on bolstering exports by forging international economic ties. Rural communities have responded by criticizing the government and clashed with mining companies. They argue that poorly distributed economic benefits have passed them over and that mining companies have polluted and exhausted local water supplies. On September 19, 2012 one person was killed and at least seven were injured in a clash between the police and protesters at the Pierina mine in the northern Ancash region of Peru. This year, protesters and police have also been killed in demonstrations against mining firms Xstrata in Cusco and Newmont in Cajamarca, where the government declared a state of emergency in July.
Condemnations from Human Rights Watch and Amnesty International over the government’s use of unwarranted force against protesters have put additional pressure on Humala to shift his course and seek consensus.
In contrast, Bolivian President Evo Morales has nationalized his country’s mining sector. In doing so, Morales antagonized foreign companies and worried foreign investors in favor of protecting national sovereignty over resources and championing his rural and indigenous support base. In 2012, Bolivia ousted American Silver Corp and Swiss giant Glencore from mines and terminated a contract with Jindal Steel, after a dispute over gas provisions and contract violations.
Yet Morales’ strategy has sparked internal tensions among his supporters. At the recently nationalized Colquiri tin mine in Inquisivi Province, independent mining cooperative workers and unionized workers from the state-owned mining company Comibol have clashed violently over who will control the mine since the government pushed out Glencore. One protester died on September 20, 2012 and others have been injured. The violence at Colquiri has halted the mine’s operations and cost Bolivia upwards of US$5 million since the beginning of September.
Mining is among the most lucrative industries in both Peru and Bolivia and the way each government manages mining crises sheds light on their respective foreign policies, domestic politics and plans for economic development. Humala faces the challenge of engaging foreign investors without allowing the promise of international partnerships to outshine the importance of domestic stability and human rights. For Morales, an internal focus presents its own stumbling blocks as his government will have to balance different local interests as they vie for control over resources.