Page 33 - STRATEGY Magazine (G)

to China, creating increased pressure to expand the drilling in the Amazon, leading to new sectors of the rain forest being auctioned off.
Similar stories are being written in the other Amazon Basin countries. In 2013, the pace of deforestation jumped 120 percent, causing environmental devastation and leading to even more conflicts as local communities struggle to survive after their water sources dry up or become too polluted to sustain human and animal life.
An increasing number of communities and indigenous peoples are expressing their opposition to mining through their own initiatives or those of their lo- cal government. These local initiatives have many different names: a neigh- borhood referendum (consulta vecinal) in Peru, good-faith referendums in Guatemala, peoples’ referendums or popular referendums in Colombia, and community referendums in Ecuador. While these voting procedures are held without the authorization of the federal state, the decisions are closely scruti- nized by the local communities, munic- ipal authorities, federal governments, and the global corporations seeking ever more permits and projects.
GOVERNMENT RESPONSE: REGULATION
In order to keep the gold rush (not to mention silver, copper, oil, and other commodities) underway, each country in Latin America has been slowly but surely increasing regulations on the mining industry in order to support the local communities, appease the environmentalists, and provide the global corporations with the necessary permits and rights to legally and safely mine.
In 2011, shortly after his election as president of Peru, Ollanta Humala took measures to improve consultation with
To reduce conflicts over natural resource projects, governments in Latin Amer- ica and elsewhere will have to address many difficult questions, including how to balance local demands with national interests, weigh industry regula- tion and investment promotion, and maximize local economic development.
local communities aimed at mitigating future conflicts. The law requires the government to seek input from the af- fected communities prior to authorizing the projects.
In Colombia, stricter environmental permitting rules put in place by the government of President Juan Manuel Santos have doubled the average wait for oil exploration permits since 2009 while the government looks at new policies to address the issues.
In Chile, environmentalists succeeded in defeating a large dam project that would have flooded 6,000 hectares of land in the Patagonia region with five dams on the Baker and Pascua Rivers.
While the conflicts continue, the re- cent downward trend in the global price of commodities has somewhat less- ened the encroachment of mining into Latin America. Resolving the tension that arises between natural resource projects that the federal government believes to be in the national interest and the local communities that may be
temporarily or permanently harmed is of vital import to the continued growth of Latin America. Finding the proper balance of regulation is a critical chal- lenge, ensuring that the environment, the local communities, the corpora- tions, and the government are all heard from, respected, and integral to the decision-making process. Important strides have been made, as evidenced, for example, by Peru’s “prior consulta- tion law,” to defuse potential conflicts before they escalate and possibly turn violent—but there is still room to improve.
As the region blossoms into the world’s leader in providing many pre- cious metals, new regulations, smarter corporations, and increased communi- cation between government, the mining industry, and local and indigenous communities promise to decrease the numbers of conflicts as Latin Ameri-
ca deals with the heady benefits and potential ruin that accompany every gold rush.
strategybg.com 31