Lawyers for the National Roundtable on Metalic Mining in El Salvador reacted to the initial hearing, saying that the proceedings ignored the essential role of local communities in determining whether mining projects can or should go forward, and the environmental risks associated with such projects.
Pacific Rim applied for the operating license in 2005 to open a mining project in the department of Cabañas, in the north of the country. It is suing for losses incurred on investments made during exploration work. Pacific Rim filed the suit based on the Central America Free Trade Agreement (CAFTA), specifically chapter 10 on investments and chapter 12 on dispute resolution.
The economic and investment focus of the dispute was heavily criticized by Luis López, a lawyer for the National Roundtable on Metalic Mining in El Salvador. "Environmental issues and the rights of the local communities are not being discussed," he says. "This operating license is being treated as just another permit, without taking into account the fact that this country is very small and densely populated, and those issues [the environment and people’s rights] will only be addressed as secondary issues."
That is why the Roundtable, with the support of Oxfam America and the Center for International Environmental Law (CIEL) will be sending an 'amicus curiae'-- a friend of the court brief-- to the ICSID. This is a way for organizations and people directly affected to get involved in a case of this kind, between a transnational company and a government. "With the 'amicus curiae' we're going to introduce new elements that will have to be taken into account, such as the environmental issue" says López. "We want all aspects of the dispute to be discussed."
A second hearing is scheduled for August, when both parties will produce further evidence to support their positions. The dispute is expected to be settled in August or September of this year.
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El Salvador is a densely populated nation, with over 300 people living in each square kilometer (with roughly 800 people living in each square mile). It is also a country where 96 percent of the surface water is contaminated, and where only 3 percent of the original forest cover still stands. It is for these reasons that Oxfam, the Catholic Church, the Roundtable on Metals Mining, and other sectors of society believe that mining projects are inappropriate for the country under current conditions. With this telephone call to the radio station, the President agreed. His strong and firm position could have far reaching implications for the efforts of various civil society organizations to reform the current Mining Law.
The arrival of mining companies to El Salvador in recent years has provoked tensions and conflicts between affected communities and other sectors of society. Under the rules of the Central America Free Trade Agreement (CAFTA), Canadian mining company Pacific Rim began an arbitration process last December against El Salvador for refusing to grant the company a mining production license. Saca says he would prefer to confront the company and be forced to pay it the US $77 million it says it has invested in the country rather than negotiate with the company and grant the license.
Oxfam America, which has raised concerns about mining activity in El Salvador, its impacts on communities, and its role in the development process, supports Saca's position.
"It's an important step for El Salvador to be the first Latin American country that undertakes a critical analysis of the costs and benefits of these mining projects and exercises its right to say 'no' to mining within its borders," says Andrés McKinley, a program officer for extractive industries with Oxfam's office in Central America. Oxfam America has an international campaign which maintains that both communities and governments have the right to know the full extent of the potential impacts of mining projects and the right to freely decide whether or not they want these projects in the country. (Right to Know, Right to Decide Campaign).
In its desire to turn the words of the highest government authority into a firm commitment, the National Roundtable On Metals Mining presented a memorandum in the legislature on March 3. This correspondence asks the legislators to vote in favor of a bill that prohibits metals mining in El Salvador. The bill was originally presented by the Roundtable in December 2006.
"The position of the president is an excellent one, albeit belated," says Francisco Pineda of the National Roundtable on Metals Mining."After four years in government he proved us—the communities, the church and the studies—correct: mining is bad. That's why we are presenting this memorandum, so that the President's message can become a political position," he said. "This issue was second on the agenda, which means it is considered important. Legislators of different parties and factions that wouldn't meet with us in the past are now doing so. We listened to the speech given by an ARENA legislator and he took the same position as the President. We hope this is not merely because we are in a campaign season, but that they continue to take this position for the good of the Salvadoran people."
Since 2005, Oxfam America has been working on the issue of mining in Central America. Through its studies, such as the recently published report, "Metals Mining and Sustainable Development in Central America: An assessment of Benefits and Costs"; its participation in forums; its dialogue with NGOs and government agencies; and media interviews, Oxfam has promoted public debate on mining. We provide information on mining and its impacts, and provide advocacy training to coalitions of organizations concerned about the possible impacts of this industry. In addition, we help coalitions engage in productive dialogue with the government, to develop concrete proposals, and use non-violent strategies.
]]>The report, Metals Mining and Sustainable Development in Central America: An Assessment of Benefits and Costs, looks at the current debate surrounding mining in Central America and the need for informed public discussion over the potential costs and benefits of aggressive development. Launched yesterday at a regional forum on metals mining, the report focuses on mining projects in El Salvador, Guatemala, and Honduras.
"Metals mining is often associated with vast wealth," said Raymond C. Offenheiser, President of Oxfam America. "Unfortunately, this is not the reality in many developing countries where natural resources continuously fail to contribute to the long-term reduction of poverty and communities have little say in how the industry affects their lands and livelihoods."
Despite a long history in Central America, mining has never played a significant role in the economies of Guatemala, Honduras, and El Salvador. Even if all the resources of these nations were developed, revenue from minerals would amount to only a small fraction of their broadly diversified economies.
But high gold and minerals prices in recent years have renewed mining companies' interest in Central American metals. The Oxfam report pays special attention to Pacific Rim Mining Corporation's El Dorado Mine in El Salvador, Goldcorp Inc.'s Marlin Mine in Guatemala, and Goldcorp's San Martin Mine in Honduras.
While mining companies and the governments that support new mining proposals have emphasized the benefits of mining, organized sectors of civil society are more concerned with the long-term costs. And there is a growing awareness of the decision-making role of communities near these projects.
"Mining companies must respect local communities' right to free, prior, and informed consent," said Offenheiser. "If they do not, a mining' project's costs will likely outweigh its benefits for local people."
While mining may create great net value, most of that value flows out of the country to the foreign owners of the mining company. Minerals commodity markets are highly volatile, modern open-air pit mining creates relatively few jobs, and the life cycles of open-pit mines are short, offering a small window of opportunity for integration with local economies.
Environmental risks include acid mine drainage and dam leaks. Although some of the worst environmental outcomes are preventable, mining companies have often not been held accountable for obeying environmental rules set out by the government or their mining contracts.
To date, community protests have delayed mining activities in Guatemala, prompted public scrutiny of exploration activities in El Salvador, and generated legislative reform in Honduras. The level and intensity of the resistance to metal mining in these three Central American nations demonstrates that local communities have judged the costs of mining projects to exceed the local benefits.
"Communities closest to the mines almost invariably suffer. This can be prevented if they have a voice in the decisions for the project," said Keith Slack, Extractive Industries Program Manager at Oxfam America. "What the mining industry could contribute to these communities must be balanced with the full scope of its costs, and communities are bringing legitimate concerns about financial, environmental, and personal costs to the table."
]]>Mining has never been a significant part of El Salvador's economy, but modern techniques make it attractive in some areas. The Canadian mining company Pacific Rim is currently exploring for minerals in three areas, and has requested a concession to restart mining at the El Dorado mine in the department of Cabañas where it says it has invested $28 million and can produce 1.2 million ounces of gold and 7.4 million ounces of silver. Pacific Rim is also in the early stages of exploration on its Zamora project, near Texistepeque, Santa Ana.
Farmers near the town of Texistepeque are skeptical about mining, and some have even visited large-scale mines in Honduras and come back opposed to any mining in El Salvador. Salvador Antonio Seseña Rodruígez, 62, is one of the farmers who made the trip to the San Andres mine in Honduras. "I was really impressed by the destruction," he said about the mine. "We saw the main river there was almost dry, and there was no life in the river."
Rodruígez is a father of 10, and makes a living raising cows and growing corn and beans. So he was particularly concerned about the water problems he saw. "We already have a water crisis here," he says. "We can't drink contaminated water. How will we end up if we allow mining here?"
It was through his church and a meeting with the Centro de Investigación Sobre Inversión y Comercio (know as CEICOM) that he participated in the exchange visit. He came back ready to mobilize others in his community.
Oxfam America is working with CEICOM and a coalition of social, environmental, and other civil society organizations pushing for a voice in a real debate about whether mining is suitable for El Salvador, where some estimates say 90 percent of surface water is already polluted. The country has also been largely deforested, leaving many communities at risk of landslides during heavy rains, so many are already concerned about the environment. The Salvadorian Bishop's Conference released a statement saying mining causes damage to the environment and communities in May of 2007.
Civil society organization in El Salvador have proposed a law that would prohibit all hard-rock mineral mining, arguing the country is too densely populated and water is too scarce to support the industry.
Oxfam America's program in Central America, which is based in El Salvador, is working to enrich the debate on this issue, help civil society project its voice and hold the government accountable to the people, and provide information about mining and its effects on communities and the environment that citizens can use to make informed decisions.
The government of El Salvador has said it will not grant any new licenses to explore or operate mines until it does a strategic environmental study to assess the likely impact of open-pit mining in the country. "We feel this study should be done with the participation of civil society," says David Pereira of CEICOM. He said that in 2006 the minister of natural resources came out publicly against mining, saying the government did not have the capacity to regulate the industry. The minister then challenged civil society to change the laws and cautioned land owners not to sell their land to mining companies.
Some members of the senate have written a public letter to government leaders saying that they believe allowing industrial mining into the northern areas of the country will jeopardize development projects supported by the Millennium Challenge Corporation (MCC), a $460-million, US government-funded foreign aid program, to bring sustained economic development in that region.
Pacific Rim continues to explore at El Dorado, which it says is its flagship property. The company is running an aggressive public relations campaign with radio ads introducing the slogan "minería verde" in an attempt to win hearts and minds of government and citizens. It also sponsors municipal soccer teams, and holds community meetings to sway farmers to accept mining in their community.
In the meantime, the Environmental Committee of Cabañas is reporting that 10 natural springs have dried up in the past month in areas close to Pacific Rim exploratory drilling. These reports have been verified by the Ministry of Natural Resources. In one of the cases, cattle-raising communities lost their natural spring four days after Pacific Rim began drilling. The company is now trucking in daily rations of water.
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