The country’s mining sector presented to the Government its proposal for actions called “Accelerate development through the responsible use of resources”, which is made up of three specific points focused on this activity and covered by a reform of the mining policy.
The executive director of the Union of Natural Resources, Mines and Quarries (Grenat), Valery Zurita, explained the three actions that consist of:
Mining fund:
Create a mining fund that can be used to capture the funds that mining projects contribute to the State and be able to transfer them in a more transparent way to the mining communities.
The proposal is that the fund be administered by the Ministry of Energy and Mines (MEM) and the Ministry of Finance. That is to say, mining companies pay royalties to the State; the MEM determines the final income estimates. Then the Minfin receives that report and calculates the distribution of the funds to the beneficiaries, which would be two: the Departmental Development Councils and the public entities that are defined at the time of creating the Fund.
Zurita said that on one occasion, the head of the MEM told them that they did not have funds to carry out on-site visits or inspections and this proposal would help because currently the funds enter a common account and there is no control of where they go.
Implement standards:
The second point is the issue of sustainability and the proposal is that the Government can also join the mining sustainability standard that the sector has adopted. The Minister of Energy and Mines, Víctor Hugo Ventura, has spoken of the intention to have sustainable mining and this standard is already being worked on in more than 13 countries around the world successfully, so they consider that it would be important for the government to also implement it.
Verification and transparency:
And the third point refers to the issue of transparency, for which it is requested to strengthen the Extractive Industries Transparency Initiative (Eiti) to which the country joined years ago and for this the government agreement that establishes must be renewed. its implementation in the country. And the second request is that on-site verifications be established in each mining project.
“The mining projects themselves are asking that there be MEM and SAT personnel in each project so that they can verify and help us make a correct classification of the minerals,” said the Grenat executive, since currently these types of verifications It is sporadic and is not done on site but from the company headquarters in the capital city.
The proposal was presented to the Minister of Energy and Mines at the second National Congress of Responsible Mining held on Thursday, March 14.
During the activity, the Mining Industry Sustainability Guide was also presented by Grenat and Centrarse, and the Mining Commitment based on 10 principles.
What does mining depend on?
The results of the La Brújula Minera survey carried out in 10 Latin American countries were also presented.
Regarding the issue of what depends on whether mining is possible in Guatemala, six aspects were identified, but of these, three are the most influential, explained Jaime Arteaga, general director of Brújula Minera and the firm Jaime Arteaga y Asociados (JA&A). who developed this survey.
- The main one, he said, is the issue of transparency or corruption. “Those who believe that royalty money is wasted on corruption or stolen are 22.5% less likely to have a positive image of mining companies.
- The same happens with those who believe that the sector affects the environment (15.3%).”
- While regarding the vision one has of the environment, or coexistence, it was mentioned that those who believe that mining helps the growth of other sectors such as agriculture are 12.1% more likely to have a good image of mining.
- Other issues that have less impact are the generation of employment, which generates resources for the country and which is a source of taxes.
“The three variables on which Guatemalans’ trust in mining companies depends are the following: believing that mining helps agriculture strengthen and grow; that the mining company demonstrates the same values regarding the environmental concern that people have; and the perception that mining resources are not stolen or used for corruption,” he expressed.
“The enemy of mining is not environmentalists, but corruption,” and that is one of the aspects that must be worked on to change the image, Arteaga added.
Government position
According to the director of Grenat, what was mentioned by the Minister of Energy and Mines during his participation in the Mining Congress, generates positive expectations in the sector for the resumption of the operation of mining projects, which in some cases have had their operations suspended or made procedures need to be finalized to operate or export.
“It is the concern of the President (Arévalo) to achieve these agreements and consensus to, in a first phase, advance the projects mentioned by the director of the Chamber of Industry, to relaunch and have an important presence in the mining sector of Guatemala. That is a great effort to make and one of the messages that I am the bearer of on behalf of the president,” said the official in his speech.
He added that they understand the global and international environment of metallic and non-metallic mining, which are two different realities. “We know that material flows must be understood within the framework of sustainability and that they are the pillar of the global economy, intimately connected with all other socioeconomic activities.”
He added that the challenge must be faced of modernizing the legal frameworks in this matter and converting them into legal models of sustainable development, since today, mining activities are required to perform with higher standards of transparency.
Asked regarding the aforementioned position, Minister Víctor Hugo Ventura responded that “the worst scenario is not reaching any agreement and entering into arbitration processes; The best scenario is to achieve consensus.”
Regarding the export credentials of CGN and Pronico, he said that they are making progress, pending inspections are being scheduled and that the United States has already answered their query regarding the situation of these companies. Regarding Cerro Blanco, he said that they have not yet received the report from the Ministry of the Environment.
Zurita added that it is expected to resume four projects that are currently suspended, which, according to studies, might contribute the equivalent of 1.3% of the gross domestic product (GDP), generate 39 thousand jobs and more than Q800 million to the State in taxes. .
The four projects referred to by both Grenat and the Guatemalan Chamber of Industry (CIG) are Fénix, in El Estor, Izabal (nickel); Escobal, in San Rafael Las Flores, Santa Rosa (silver); Sechol, in Alta Verapaz (nickel), and Cerro Blanco in Jutiapa (gold). Apart from these, the Progreso VII Derivada project, known as La Puya, also remains suspended.
“We have already seen it and the data does not lie: in 2014, with a total production of Q5,956 million, the mining sector demonstrated the potential of this sector, with record figures. It is time to rethink the future of the industry and its importance for the country, having clear examples of great countries that managed to take advantage of this potential and understood that we cannot achieve the long-awaited development by stopping an industry, but that it must be promoted. And we know that this is only possible through a national dialogue that allows us to chart the future of mining, promoting sustainability and transparency practices in its operations, and by guaranteeing legal certainty,” commented Juan Suárez, vice president of the CIG Board of Directors.
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