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Canadian Mining Policy in Practice

Jen Moore Jennifer Moore worked as MiningWatch's first full-time Latin America Program Coordinator from 2010 to 2018.

Presentation for the 2011 Community Movements Conference at Trent University

Jen Moore

February 12th, 2011

Trying to understand Canadian foreign policy or our mining policy in practice was one of the aims that I had when I set off to Ecuador several years ago, so I'm happy to see that it's a main focus of this conference. I want to share just a few insights into what I see happening, and try to contribute to the discussion about how we might respond.

First, a bit of an overview. Canada is an important player in the global mining industry. Nearly a quarter of the top forty mining companies in the world are Canadian-owned and roughly 60% of the world's publicly traded mining companies are listed on Canadian stock exchanges, far more than any other stock exchange. In Latin America alone, a region that we have made an economic and foreign policy priority, Canadian financed companies hold about 1,400 metal mining properties from Mexico to Argentina.

But companies don't just obtain financing in Canada. Canadian-financed companies, which dominate the mining sector in some countries - such as Guatemala or Ecuador – are able to sustain strong lobbies regarding mining policy changes, often receiving substantial support from Canadian embassies abroad.

Today, with prices for commodities, like gold, booming the pressure is on to expand old mines and to open up new ones. While you might hear a lot of talk from industry and its promoters about the importance of mining for development, the national interest, or jobs and community well-being, it is worth keeping in mind that it is not the participation and interests of local people and their institutions that drive this industry, but rather the piles of profits that an operating mine can pull in as it tears down mountains, builds deep tunnels near precious headwaters, or opens up roads and pits in remote and sometimes sacred lands.

To give an example of how this works, I'm wondering if some of you heard about the Wikileaks cables from the US Embassy in Lima that were revealed at the end of January?

To summarize, the leaked information refers to an August 2005 meeting hosted by the Canadian and US Ambassadors with representatives of major mining companies operating in Peru. The intent was, I quote, “to review their operating difficulties... and to coordinate efforts to improve the investment climate.”

Representatives from major companies such as Newmont, BHP Billiton and Toronto-based Barrick Gold were present, and Swiss, Australian and British diplomats also attended. The South African Embassy was invited to participate, but reportedly couldn't make it. The US cable calls this set of embassies, a “diplomatic mining group.”

The immediate backdrop to these diplomatic cables was violent police repression against peasant farmers protesting a copper-molybdenum mine in northwestern Peru, close to the border with Ecuador. Three protesters were shot and one died. This same incident also gave rise to allegations of “torture, inhumane and degrading treatment, and false imprisonment” that have since been filed in proceedings going forward in a British high court. Back in 2005, this project was fully-owned by a British junior mineral exploration company, Monterrico Metals. Zijin, a Chinese consortium, has now bought out most of the company; Monterrico is currently unable to divest of its final 10% share due to a court injunction. The company denies any involvement in the alleged abuses. [1]

But this was just the most violent of several persistent conflicts in the country. To read these diplomatic cables, however, you would think the victims were the corporate elite.

According to the leaked cables, the company representatives described their projects as under attack, blaming leftist political parties, local campesino organizations, as well as drug traffickers and NGOs. In no way do the records of this meeting indicate any recognition of local community concerns for the future of their water supplies, lands, or livelihoods.

Most disconcertingly, the company reps asked the group of diplomats to urge the Peruvian government to encourage a rotation of teachers in conflictive mining communities, and for the Catholic Church to rotate bishops in these regions as well. They further complained that political parties had not spoken out about what they described as “anti-mining violence.”

Without showing any hint of concern for the violence that local communities were facing, the “diplomatic mining group” signalled that they could help out. The US Ambassador said embassies could do more to promote the benefits that mining brings to the country and that, “pending key information from the mining companies,” that they were “ready to meet as a group with the [government of Peru], the Catholic Church and political party leaders.” [2]

Dr. José De Echave, a highly respected advocate for more just mining practices in Peru, points out that evidence indicates they might have followed through. He notes that since this time, laws have been tightened to raise penalties against those who protest, hundreds have had to face serious charges for questioning actual and proposed mining projects, while teachers have reportedly been harassed and moved, NGOs have had their telephone conversations and emails monitored, and the highly regarded priest and environmental defender, Father Marco Arana, has been pursued. [3]

We also know that shortly after this meeting that the Canadian Embassy approached at least one Canadian NGO working in Peru. According to one account reported on by a research team assembled in 2006 by the Peru Support Group, the Embassy notified Canadian Lutheran World Relief that “it had to end its funding of Peruvian NGOs that questioned forms being taken by mining development, and that did legal defence work for affected populations. This work, it was told, was a foreign relations problem for Canada. If CLWR did not end support to these NGOs, it would lose its co-financing support from the Canadian government. Peruvian NGOs receiving this support were informed of this termination in October 2005.” [4]

Such silence from diplomatic representatives when serious allegations of egregious harms have arisen and an uncritical backing for corporate interests, contributes to polarization in countries like Peru. And the situation in Peru is polarized.

On June 5th 2009, following 58 days of protest along a stretch of highway called the Devil's Curve, which connects the northern Peruvian highlands with the Amazon, a police operation was ordered resulting in the deaths of twenty three police officers, at least five indigenous people and five residents from the nearby town of Bagua. Another 200 people were wounded. The protest arose in opposition to a series of decrees that President Alan García had passed presumably - although apparently going much further than necessary - to implement the US free trade agreement with Peru. [5]

That same month, the National Ombudsman's office registered 128 socio-environmental disputes across the country, nearly double from the same time a year earlier.

At the demonstration near Bagua, however, the large number of Awajun and Wampi indigenous people present bore direct relation to a conflict associated with a Canadian-owned mine project on the Amazonian side of the border with Ecuador. [6] Owned by Dorato Resources, a junior mining company, local communities allege that the Peruvian government has given the company favourable treatment by reducing in half the size of a national park that they had been negotiating in order to protect indigenous territories and important headwaters from mining activities. [7] Less than two weeks following the Bagua massacre, the Canadian government ratified the Canada-Peru Free Trade Agreement, remaining silent [8] and then denying [9] any connection with the violence.

Rather than blame teachers, priests, peasant farmer organizations or leftist political parties, however, the National Ombudsman's office and other international human rights organizations attribute such conflicts to a lack of any real regard for the participation of affected communities in decisions being made over development projects taking place on their lands and in their watersheds.

But attempts to address this in Peruvian law have been stymied, leading some to fear that another Bagua could be just around the corner. [10]

In the meantime, corporate rights are firmly in place. In addition to free trade agreements with the US and Canada, Peru has signed similar agreements with Chile, Mercosur, Singapore and China. [11] And at least one US-based mining company, the Renco Group, which owns the U.S. mining and metallurgical company Doe Run, has threatened to start an international arbitration process invoking protections available to it under the US-Peru FTA. The company's smelter in the town of La Oroya, known as one of the most polluted places on earth, has been at the centre of disputes over whether the company or the state must pay to clean up contamination and compensate families of more than one hundred children with lead poisoning. [12]

International agreements have been used in similar ways in El Salvador. Vancouver-based Pacific Rim Mining opened a shell company in Nevada in order to take advantage of the US Central America Free Trade Agreement and has sued the Salvadoran government for $77 million for having not granted it a licence to extract in the headwaters of the country's most important river system. With serious disputes arising right now in relation to Canadian-owned operations in both Colombia and Panama - two more countries that we have free trade agreements with - one might be concerned about how such agreements could be enacted if corporate interests are curbed - for instance if Colombia's Ministry of the Environment, Housing and Territorial Development applies its current mining code, which says that companies like Greystar Resources, should not be operating in high altitude wetlands where most of the company's operations are currently situated. [13]

The point is that what's coming to light as we take a critical look at Canadian interests in the hemisphere is that Canada's foreign policy is largely designed to protect our own interests. I think this is perhaps most surprising to Canadians more than anyone else in the world. But the central issue here is not our reputation, so much as looking at what we can do. And certainly, affected communities are not hanging around waiting for Canada to clean up its act.

Considering mining's dirty legacy and the corresponding lack of capacity within weak Latin American states to deal with the implications that such industrial operations could have on water, land and livelihoods, broad coalitions are forming in opposition to mining as it is currently taking place, giving rise to tough demands.

From provincial legislation to ban open-pit mining to federal legislation to protect the glaciers in Argentina, to mining code reforms in Colombia to protect high altitude wetlands, or an attempt to revoke all mineral concessions in Ecuador based upon overlap with sources of water, protected natural areas, and where local populations have not been consulted, communities and their elected representatives are making diverse attempts to apply the precautionary principle.

Costa Rica's president has also just signed a law into effect prohibiting open pit mining, and El Salvador maintains a suspension on all large-scale mining. In rural Guatemala, although their decisions have yet to be respected, quite literally hundreds of thousands of rural people have voted against metal mining in municipally organized votes. And we've been watching demonstrations in favour of a moratorium on mining in Panama grow in recent weeks.

In other words, the people of Latin America are not mere victims of the abuses of our companies, they are leading critical processes of resistance to ultimately determine what's in their best interest.

It's been over five years, now, since the Standing Committee on Foreign Affairs and International Trade issued recommendations to parliament to create legislation to address serious human rights violations and environmental destruction associated with Canadian extractive industry overseas. And while current measures to strengthen regulations and hold corporations to account, like Bill C-300, have been shut down, thanks to the our well-heeled industry and the politicians that support it, I think we can build upon growing awareness.

There is a clear role for Canadians to continue denouncing abuses, to better understand and respect the serious limits that people in Latin America are trying to put in place on mining expansion, and to ensure that we have strong independent institutions and a responsive judiciary that can apply punitive sanctions, revoke financial support when deserved, ensure full cost accounting, and bring the authors of egregious abuses to account.

[1] Guardian, “UK firms' partner 'wanted Peru to curb priests in mine conflict areas',” January 31st 2011
[2] Guardian, “US Embassy Cables: Mining companies worry about security” January 31st 2011
[3] Cooperacción, José De Echave C., “Peru:Wikileaks, Empresas Mineras y Embajadas,” February 2nd 2011
[4] Peru Support Group, “Mining and Development in Peru with Special Reference to the Rio Blanco Project, Piura,” March 2007
[5] Upside Down World, “Peru and Ecuador: A Common Enemy.” Jennifer Moore, July 30th 2009,
[6] Interview with lawyer Marco Huaco, Macas, July 2009
[7] Servindi, “Reports document alienation of land in Cordillera del Condor, Peru for mining,” March 8th 2010
[8] Georgia Straight, Dawn Paley, “Canada ratifies Peru free trade agreement, stays silent on Amazon massacre.” June 18 th 2009
[9] Embassy Magazine, Michelle Collins, "Peruvian Violence Prompts Concerns over Canada's Push for Free Trade Deals," June 24th 2009
[10] Servindi, “Is another Bagua massacre just around the corner?.” January 7th 2011
[11] IPS, Milagros Salazar, “Free trade undermining rights in Peru,” March 25th 2011
[12] IPS, Milagros Salazar, “Doe Run's Latest Move,” January 5th 2011
[13] Colombian Network Against Large-Scale Transnational Mining (Reclame), "Urgent Action: Protect Vital Wetlands in Colombia from Canadian Mining Project," January 21st 2011