Anti-mining sentiment in Peru main barrier to sector’s growth – S&P
Anti-mining protests continue to be Peru’s mining industry main obstacle to its expansion as several projects could be delayed or scrapped entirely if string opposition persists, says experts from New-York based analysis firm Standard & Poor’s.
In a note published Wednesday, the analysts say that despite current challenges, the country’s mining sector is poised for significant growth, “thanks to its large and high-quality metals reserves, reasonable tax regime, regulations that promote private investment, attractive power costs, and a long track record of mining activity.”
According to government figures, Peru’s economy grew an average of 6.4% a year from 2002-12 after adjusting for inflation, a remarkable period of sustained expansion that has made it one of the world’s star economies.
This has allowed Peru’s government to boost savings and cut debt, making the country less vulnerable to a drop in export prices and other external shocks, pointed the analysts in the report.
The analysts predict the nation’s main copper projects will more than double the Peru’s production levels by 2016—exceeding 2.7 million tons a year or 14% of current global copper supply.
Last year Peru’s mining, oil and energy society (SNMPE) said that, as a result of a year of non-stop anti-mining protests in different regions of the country, investors had started looking for greener pastures and so mining investment in the South American nation was expected to fall 33% in 2013.
Behind Chile, Peru is the world's second biggest producer of copper and silver and a major producer of gold, zinc, lead and other minerals.
Image from archives