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Message: From Silvia Santacruz
Firms See Stability as Correa Rebuffs CONAIE
Photo Caption — President Correa visits the northern province of Tulcán prior to winning the Constitutional referendum. Here, locals are seen throwing rose petals at the president as a welcoming gesture. Photo credit — Ecuador's Presidency
By Silvia Santacruz
Ecuador Mining News
Washington D.C., October 16, 2008 — Wearing a poncho, hand-embroidered white shirt, or a panama hat, Ecuador’s President Rafael Correa travels throughout his country bearing gifts for the poorest. The presents vary from a USD 5,000 subsidy to build new houses, to agriculture micro-credits, to new police patrols, to a simple wave to the masses while standing up through the sunroof of a pickup truck. The president is campaigning for reelection.
The recently approved Constitution permits Correa to run for reelection for two consecutive terms, beginning with the national elections in February 2009. If he wins – as is expected due to his high popularity — the Andean country may finally enjoy political stability not seen in a decade. Prior to Correa, three Ecuadorian presidents failed to complete their terms, having been forced from office.
Keeping an executive in power – and this administration, in particular – is the most important challenge for international mining companies operating in Ecuador, some of which have been located there for over 10 years, lured by an attractive 1991 mining law. Such firms have seen mining authorities come and go, but under a Correa administration they have optimistically begun to develop a responsible mining industry for the long run.
Correa’s leadership on the mining issue was once again revealed during his most recent Saturday radio address. And following the recent resignation of MMP Minister Galo Chiriboga, the new MMP minister Derlis Palacios has stated preliminary confidence in undersecretary of mines José Serrano and his main advisor, Javier Córdova, the well-known duo that has been dealing with international firms. Nonetheless, Correa’s interest in developing the industry seems to go beyond agency-level leadership, according to Inca Kola News. “The MMP top position will continue to be a figurehead… the real boss of MMP was, is and certainly will continue to be Correa..,” states the reliable blog on its Correa Lays it Out entry.
Some international mining companies operating in Ecuador continue to be positive concerning the prospect of a Correa-driven mining policy.
“The constitutional referendum is an important step in fulfilling president Correa’s commitment to develop a modern, responsible mining industry which will provide an equitable sharing of benefits amongst all stakeholders. IAMGOLD will continue to work proactively with the government of Ecuador to support their stated intention to complete a new mining law and related legislation by the year end,” said president and CEO Joseph Conway, in a statement released a day after the new constitution was approved by a margin of 64 percent. Read IAMGOLD Sept. 29th Press Release
A similar view was released by Cornerstone Capital Resources last September 30th.
“Cornerstone anticipates the government will act quickly to establish the new rules for exploration and mining. President Correa has been a consistent advocate for responsible mining as an integral part of Ecuador’s economic development.”
The Canadian company also specifies the next steps toward the creation of a new legal and regulatory framework for the industry. “The new legislative body, Congresillo, should be in place by mid October, and it appears that the government wants to deal with the new mining law on a priority basis. There is then a 60 day period in which to complete the new regulations, a schedule which may permit resumption of field activities early in 2009.”
Thus, the mining horizon seems to be getting clearer, but the industry must sit and wait a few more months to resume drilling despite the expiration next Saturday of the mining mandate, which halted operations for six months. According to the mandate, if a new mining law is not approved at the time of the mandate’s expiration, the MMP must sign individually negotiated contracts with each firm. The MMP ministry, though, has not yet released any information on this issue.
In the meantime, a vocal indigenous movement assembling in Cuenca called CONAIE is preparing a national indigenous anti-mining protest this month, without specifying the exact date. CONAIE and its allies want the new mining law to be tabled because “it affects the environment, changes the communities’ lives, and threatens to destroy all natural resources,” reported El Comercio.
Correa, however, keeps labeling CONAIE as “childish environmentalists” who only “act that way, using force. Their positions are regrettable and I think they are doomed to failure. The country is tired of that and is now in a different dynamic. I think [the CONAIE] are going lose more credibility with these extreme positions, which often do not come from them, but from foreign NGOs. These people have nothing to lose, and work to convince indigenous leaders with their ideas. These ‘childish’ radical positions are camouflaged in indigenousness or environmentalism,” Correa said during a press conference with international media. Read EMN’s Correa Confirms WFT, Condemns Eco-Extremists
International mining companies in Ecuador are facing a difficult set of circumstances, but they are counting on President Correa’s strong leadership and backing. Such determination on the part of the president may be needed in a country where anti-development NGOs have infiltrated indigenous movements and do not represent homegrown interests. Correa claims to know their true intentions and won’t hesitate in repeating his rebuke in Dayuma, Orellana province. There, he deployed the military to confront extreme leftists, controlling violent protests and imprisoning the most radical ones who were found to be in possession of explosives. Ecuador’s president seems intent on honoring his word to develop a large-scale responsible mining industry. And, on fighting eco-extremists he says want to keep Ecuador underdeveloped and mired in poverty. Read EMN’sCorrea Asserts His Power to Settle Conflicts
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