42 The Americas The Economist May 28th 2022
D
eep in a valley, at 3,500 metres in the
Andes near Moquegua in southern
Peru, giant terraces are being carved from
the mountainside. Diggers load loose
rock into 320tonne driverless trucks
which carry it to a conveyor belt. They
pass by a dam built to hold back the
Asana river in case it overflows the tun
nel which carries it for almost eight
kilometres beneath Quellaveco. This is a
new $5.5bn copper mine operated by
Anglo American, a Londonlisted multi
national mining company, and part
owned by Mitsubishi of Japan.
The diggers and trucks are “premin
ing”, stripping away surface rock to
expose the copper ore below. Nearby,
workers are putting the finishing touch
es to the plant which will extract the
metal from its ore. In the next few weeks
mining proper will start. It has taken
more than a decade to get to this stage.
With blanket WiFi as well as its driver
less trucks, Quellaveco is perhaps the
most technologically advanced mine in
Latin America. It is also a test of whether
big mining has a future in a country and
region in which social conflict threatens
to banish extractive industries.
Channelling the river past the mine,
so that it emerges untouched down
stream, was a condition for Quellaveco to
gain an environmental licence and local
consent. So was a new reservoir, built by
Anglo at 5,500 metres on the headwaters
of another river 90km away. The mine
will use just 4m of the reservoir’s 60m
cubic metres of water. The rest will go to
farmers lower down, providing them
with a reliable water supply they previ
ously lacked. The mine will depend upon
water from a third river which is natu
rally suffused with heavy metals.
Other commitments came from 18
months of talks between the company,local officials and community groups
convened in 2011 by Martín Vizcarra, the
governor of the Moquegua region, who
later became Peru’s president. Anglo
agreed to pay for a $1bn development
fund, to be spent over the 30year life of
the mine, and to fund small community
projects. Perhaps its most important
commitment was to hire local people,
many of whom it has trained, and to give
opportunities to local suppliers. Of the
mine’s permanent workforce of 2,500, the
company says 71% are from Moquegua and
28% are women (compared with an aver
age of 10% at mines in Peru).
“The key is that people can see some
thing beyond tomorrow,” says Hugh El
liott, a British diplomat who worked for
Anglo American and was involved in the
talks. “You can build sustainable liveli
hoods if you do it right.” That is where
other big mines have run into problems.
Chineseowned Las Bambas has been shut
for weeks after local communities occu
pied parts of it. When they surrendered
their land for the project, they received
new houses, plots elsewhere and at least$100,000 in cash per family. Now the
money has been spent and they find it
hard to adapt to a more urban life.
That is one explanation. The other is
that activists are attempting to extort
more money from mines, egged on by
Vladimir Cerrón, an ally of Cuba whose
Free Peru party controls Pedro Castillo,
the president. Under Mr Castillo, con
flicts over mining have increased sharp
ly. Protesters recently forced a two
month closure at Cuajone, a much older
copper mine near Quellaveco. They were
demanding $5bn.
Mining is vital for Peru. Over the past
decade it has provided 59% of export
income and 10% of total tax revenues,
according to the Instituto Peruano de
Economía, a thinktank. Quellaveco will
boost its output of copper by 1012%. The
metal is vital to greeneconomy products
such as electric cars.
Mining companies have often been
insensitive to their surroundings. But
many of their problems stem from the
weakness of government, both national
and local. Their taxes don’t necessarily
translate into benefits for local commu
nities. Anglo was fortunate that Mr Viz
carra, a poor president but an effective
governor, was determined to make dia
logue work. That created stakeholders
with an interest in the mine’s success.
But Quellaveco now faces the tricky
transition from construction, which at
its peak involved 15,000 workers, to its
much smaller operational staff. “It’s very
different from ten or 30 years ago, it’s not
just about a mining business where you
try to be efficient,” says Adolfo Heeren,
Anglo American’s boss in Peru. “You have
to renew your social licence every day.”
That costs more upfront. But if it allows
continuous operation, it saves money in
the long run.A test of whether big mining can be socially sustainableBelloThe wealth of the Andes
Like other candidates he promises to
implement the peace deal in full, even
though his father was kidnapped by the
farcand had to be ransomed. He even
wants to negotiate peace with the eln, an
extant leftist guerrilla group that is
thought to have kidnapped his daughter in
2004 (she has never been found).
Some of Mr Hernández’s bluster has au
thoritarian overtones. He plans to hold
daily press conferences at which suppos
edly corrupt politicians will be named and
shamed. Colombians who inform against
corrupt officials will, he says, get 20% ofany money that can be clawed back as a re
sult. He has expressed fondness for Nayib
Bukele, El Salvador’s autocratic president,
who rules through Twitterdiktat.
The most pressing concern is what will
happen right after the vote. “Colombia is at
risk of entering a new cycle of violence,”
says Alejandro Gaviria, a centrist who ran
unsuccessfully in the March primaries. Mr
Petro is likely to cry foul if he loses, and
start whipping up his supporters. The
ground is prepared for this; after making
claims of fraud in the legislative elections
in March, a recount allowed Mr Petro’s coalition to secure at least three extra seats. A
victory for Mr Gutiérrez is likely to bring
protesters to the streets, unhappy with the
status quo he represents.
And like leftist candidates before him,
Mr Petro’s life is at risk. He and his vice
presidential candidate, Francia Márquez, a
rare black politician, have received death
threats. They have campaigned behind
bodyguards wielding riot shields. Such
campaign tools attest to the possibility of
violence. Colombianshope for change. A
spiral of postelectionmayhem is not what
they have in mind.n