Business & Economy

Chile’s new constitution promises transition to green mining

By Patricia Nieto Mariño

Santiago, Jun 29 (EFE).- Chile’s powerful mining sector has destroyed glaciers for decades, contaminated water supplies with heavy metals and spewed pollutants into the air in so-called “Sacrifice Zones,” but a draft constitution could usher in a new, more environmentally friendly reality for that industry.

The new charter, which will be formally presented on Monday and put to a referendum on Sept. 4, for the first time proposes restrictions on the country’s leading industry, one that accounts for 10 percent of the country’s gross domestic product.

The text provides a blueprint for a shift to a green economy and aims to bring a halt to the current model of extractivist mining, which took root during Gen. Augusto Pinochet’s 1973-1990 military regime and was underpinned by the current 1980 constitution.

Jose Piñera, a conservative economist who served as mining minister from 1980 to 1981, said Chile’s Mining Code and Organic Constitutional Law on Mining Concessions guaranteed free access and legal certainty to private investors by offering exploitation concessions with no time restrictions or depth limits.

According to environmentalist Carolina Vilches, a member of the Chilean Constitutional Convention, that regulatory framework paved the way for veritable environmental “atrocities.”

Over the past few decades, a score of mine sites – including Barrick Gold’s controversial, open-pit Pascua Lama site and Anglo American’s Los Bronces copper mine – have damaged more than 3.3 kilometers (2 miles) of glaciers, threatening valuable water reserves in a country in the grips of a decade-long drought.

“The new constitution aims to reverse this ecocide and put Chile on a path to a sustainable model where industry is compatible with social development,” Vilches said.

The draft constitution bans mining in “glaciers and protected areas” and requires that the mining industry take into consideration the need for “environmental and social protection.”

It also makes the government responsible for regulating that sector’s impact and grants it the power to close mines or temporarily halt their operations.

But the convention voted down articles that would have given the government a majority stake in all copper mines and exclusive mining rights to lithium, dubbed “white gold” because of that ultra-light metal’s importance for the development of electric vehicles.

According to Gustavo Lagos, an economist at the Pontifical Catholic University of Chile and member of the Center for Copper and Mining Studies (Cesco), the new constitution “encourages the drafting of laws to nationalize minerals.”

“Leaving the future of mining to the mercy of parliament provides no guarantees to private investors and could push away significant capital,” the expert said.

Approximately 30 percent of Chile’s copper, that nation’s most important resource and main export, is currently nationalized through state-run producer Codelco, which accounts for one-tenth of global output of the red metal.

Mining companies also have expressed skepticism about the new constitution, with the president of the Mining Chamber of Chile, Miguel Zauschkevich, telling Efe it does not provide legal certainty for an activity that “requires great stability.”

“The country can’t allow so much uncertainty in its most important economic activity,” he said.

But Felipe Roman, president of the Chilean Mining Federation, which comprises the large private-sector mine workers’ unions, said the constitution can serve to ensure the mining industry adapts “to the needs of the 21st century,”

“There’s a minority that has devoted itself to spreading rumors about the apocalyptic effects the constitution will have on our activity,” he said. “But the draft just points to consolidating a more modern, committed industry.”

“We’re in a very worrying environmental situation, especially in terms of water scarcity, and mining also has to do things the right way,” Roman said. EFE


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