Like water for gold: The Peruvian town taking on a mining giant and the government
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Like water for gold: The Peruvian town taking on a mining giant and the government

The city of Cajamarca, nestled in the northern Peruvian Andes, is no stranger to gold — and the violence that can come with it. It was here, nearly 500 years ago, that the Inca emperor Atahualpa was captured after the slaughter of thousands of his unarmed followers by 168 Spaniards. Still standing is the room which he filled with gold to be freed. The Inca paid his ransom, but was executed anyway.

Now, centuries later, Cajamarca is witness to a new battle between locals and outside forces beyond their control. A US$4.8 billion gold and copper mining project, Minas Conga, was announced in 2010 to replace the exhausted Yanacocha facility nearby. Majority-owned by U.S. mining giant Newmont, it was due to open in 2015 and produce more than 350,000 ounces of gold and 120 million tons of copper annually during its 19-year lifespan.

Water yes, gold no

Locals, however, have other priorities. In 2011, the administration of President Ollanta Humala was forced to backpedal in the face of fierce community resistance to Conga on environmental grounds. Many feared that the project would divert and pollute already scarce water resources, threatening the key local dairy industry and the viability of rural communities.

“We used to call it The Nile,” says one local woman, gesturing to a river bordering a poor neighborhood in southeast Cajamarca. “Only a few years ago, women would come here to wash clothes, and children played in it.”

‘The Nile’ is now a trickle of water over rubbish-strewn rocks. Campaign promises in the hilltop barrios during October’s municipal elections often consisted of simple murals of plumbing and taps. “Water and cheese yes, gold no” goes the slogan visible around the town.

Following the elections, Newmont announced its intention to work with local authorities to restart the project, something that — especially if reelected regional governor and Conga opponent Gregorio Santos is found guilty of corruption and murder charges — is likely a matter of when, not if.

The mining conglomerate and its subsidiaries have held extensive consultations and poured millions into improving local water supplies. Independent reviews have green-lighted operations and President Humala has promised billions of dollars’ worth of investment in the region to placate protesters.

If that fails, the martial law that was deployed against previous violent protests could be rolled out again. Heavy-handed tactics by local police were brought into the spotlight last week with the fatal shooting of a householder during an eviction.

Tread carefully and listen

The picture is similar throughout the region: governments keen to boost national development ally with multinationals to exploit mineral resources, only to be checked by legitimate local concerns.

Dr. Elizabeth Adey, a social specialist working with multi-sectoral consulting firm Wardell Armstrong, explained that, in her opinion, mining firms are cautious about the potential risks to community and individual rights which “need managing carefully to avoid creating actual impacts.”

However, Adey suggested that mining companies worldwide are beginning to pay closer attention to rights considerations, as evidenced by a October 20 conference in the U.K. Parliament on integrating human rights into mining, hosted by WA and attended by industry representatives as well as Aurora Williams Baussa, Chile’s Minister of Mines.

“I believe that there are many people within the mining industry who are genuinely interested in creating positive changes to embed human rights considerations within all aspects of projects,” Adey said. She clarified that she was voicing her own personal opinions, not those of her employer.

Governments and company executives have a role, but local pre-project evaluation and ongoing monitoring is key.

“Whilst large multinational corporations potentially have more capacity to develop human rights policy and company-wide strategy, I consider that it comes down to what happens on the ground, how effective management measures are at a site level,” she said.

“In my role as a social specialist I work at a site level on projects and often find that people tell me things that I know wouldn’t get told straight to company personnel. Listening to local people and understanding their lives and how a project can affect them…is essential to avoid impacting human rights, and to identify and resolve potential impacts before they become major,” Adey concluded.

Diversify or die

The reputational costs of rights violations in the age of social media and improved monitoring procedures, may give mining companies an incentive to work harder to reduce the risk of damage to individuals and communities.

But ultimately, with global prices for metals set to decline steadily in coming years —  as pinched consumers buy fewer of the products that need them — Peru and other Latin American nations will increasingly need to invest in other sources of sustainable growth that don’t jeopardize the wellbeing of their citizens.

In Chile’s arid Atacama region, the remains of mining villages crumbling back into the desert — relics of previous commodity booms for nitrates and silver — offer a lesson about the impermanence of growth based on raw materials and metals.

In Cajamarca, Atahualpa’s ransom room also has a message from the past: freedom, and progress, are unlikely to be bought with gold alone.