Canada encourages Peru to cut mining red tape

Harper supports streamlining of environmental assessment process

LIMA, PERU — Prime Minister Stephen Harper is set to announce Canadian support for the streamlining of environmental-impact assessments for mining projects in Peru.

The move is designed to end what has been described as a major bottleneck when it comes to the Latin American country taking full advantage of its natural-resource wealth, but it could also raise concerns among environmental and anti-mining groups.

Following a meeting here Wednesday morning, Harper and Peruvian President Ollanta Humala will reiterate the growing ties between Peru and Canada, including the signing of a new deal expanding airline services between the two countries, and highlighting a recently signed defence cooperation agreement.

But Peru’s booming mining sector, which comprises a huge part of Latin American country’s economy and in which Canadian companies have already invested billions, will be the focus.

Mining is not only a major economic driver in Peru, it is also a continuing source of social unrest. Peru’s human rights ombudsman reported last summer that there were 168 protests over natural resources in July 2012, and that 17 people had been killed in such protests since Humala came into office in July 2011.

These figures represented a decrease from previous years, including the 191 people killed between 2006 and 2011, but the figures still highlight the ongoing problems facing this country when it comes to managing its natural resource wealth.

In a joint statement, Harper and Humala will highlight “the importance of maintaining an open and stable investment environment in mining and energy sectors.”

They will also agree that “natural resources, when developed responsibly, can lead to sustainable and inclusive economic growth” and “committed to significantly enhance co-operation in the extractive sector and related socio-economic programs.”

Canada already invests more than $25 million a year in foreign aid, which includes funding several controversial projects pairing development NGOs with mining companies.

But Canada will now be turning its attention to Peru’s environmental-impact assessment regime for mining projects.

A Canadian official speaking on background said Peru has a very complex and detailed assessment process that is managed by only a handful of Peruvian government officials.

This presents an obstacle to projects getting approved in a timely manner, which hurts companies and communities that stand to benefit from projects, the official said, as well as Peru’s ability to attract foreign investment.

Media reports indicate mining projects worth as much as $7.5 billion were in limbo at the beginning of 2013 as only 53 per cent of environmental-impact assessments submitted in 2012 had worked their way through the system.

In their joint statement, Harper and Humala will announce “Canadian support to Peru’s efforts to improve the environmental impact assessment process for mining and energy projects as well as support to natural resource governance.”

While reducing the hurdles to getting mining projects approved could benefit affected communities through jobs and increased revenues, environmental concerns have been at the centre of many of the protests that have wracked Peru.