Excerpts From :

Harper’s Free Trade Mantra: Hush, Rush, and Sign
Written by Dawn Paley
Tuesday, 01 July 2008

Canada’s Business Sector: Precious Interests

The mining sector, along with the financial and oil and gas sectors,
is among the major Canadian business interests in Latin America.

“Mining is the single activity in which Latin America and the
Caribbean is the most prominent region for Canadian Outward Foreign
Direct Investment,” reads a recent report from the UN’s Economic
Commission for Latin America. [3]

Chile, the world’s largest producer of copper, was the first Latin
American country to sign a bilateral Free Trade Agreement with Canada.

In a presentation to the International Trade Committee, Trade Minister
David Emerson explained that after the Canada-Chile Free Trade
Agreement was signed, “Canadian mining companies in particular
invested massively in Chile, [and] brought the resource or
semi-processed resource product out of Chile into Canada… creating a
stronger mining sector and opportunities for value added in the
Canadian economy.” [4]

In Colombia and Peru, the majority of Canadian investment is in the
extractive industries.

Peru is an extreme case. In 2006, the top five exports from Peru to
Canada break down as follows: gold made up 57.5%, raw copper accounted
for 10.8%, refined copper for 8.7%, zinc for 8.1%, and unleaded
gasoline for 6.0%. [5]

A large part of the production of these raw materials exported from
Peru to Canada is in the hands of Canadian companies, including
Barrick Gold, Yamana Gold, Teck Cominco and Iberian Minerals
Corporation.

More than two thirds of the estimated $3 billion invested by Canadian
companies in Colombia is in the extractives sector. The Canadian
companies with the largest estimated investments in Colombia in 2007
include Nexen Inc and Petrobank Energy and Resources, both based in
Calgary, and Toronto’s Pacific Rubiales Energy.

The on-going armed conflict in Colombia, combined with a history of
small-scale mining activity, has thus far prevented the country from
being transformed into a metallic metal producer on par with Peru, but
that trend is changing, and fast. South African gold giant Anglo Gold
Ashanti and their partners have secured more than 10 million hectares
in mineral concessions in Colombia since 2004.

Colombia is already a major producer of coal, and new changes in the
Mining Law as well as President Uribe’s policy of ‘Democratic
Security’ and guarantees to trans-national companies, are being made
to facilitate the start up of large-scale, metallic mining projects in
Colombia.

Canadian junior mining companies are present in scores. Of note are
B2Gold Corp, Bandera Gold Ltd., Blue Sky Uranium Corp, Colombia
Goldfields, Greystar Resources, Latin American Minerals, and Mega
Uranium Ltd, all of which are carrying out exploration for gold or
uranium.

Mining Industry Pushes for Protection

The push for Free Trade Agreements has been strong from businesses and
business lobbies representing the extractive industries. At a
presentation on Canadian mining investment on March 6, 2005, Christian
Côté from International Trade Canada pointed out to his audience that
there exists “pressure from natural resource community for government
to improve investment climate for target countries.” [6]

Canadian companies stand to benefit from Free Trade Agreements because
they remove the possibility that host governments will raise taxes,
change their laws, or expropriate properties.

By way of example, the FTA with Peru eliminates the possibility that
Peru would enact such a thing as the recent “Mining Mandate” passed in
Ecuador by the Constituent Assembly, which suspends all large scale
mining activity (exploration) in Ecuador for 180 days while a new
Mining Law is written.

According to Foreign Affairs Canada “An investment chapter in the
Canada-Peru FTA locks in market access for Canadian investors in Peru
and provides greater stability, transparency and protection for their
investments.” [7]