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PANAMA CITY—Massive Indigenous mobilization in Panama recently brought down a contentious law that made it easier for multinational mining corporations to gain entry into the Central American country. Law 8, a revision of Panama's 1963 mining code, enabled foreign, state-owned companies to directly invest in large-scale mining projects.
While seen as a tentative victory for the Indigenous Ngobe people, who strongly opposed the law, international corporations continue to scramble to win concessions to Panama’s mineral wealth. Canadian companies are at the forefront of international mining interests in the country.
The new laws granted foreign, state-owned companies the right to acquire concessions to vast tracts of land in Panama, a change many deemed a threat to national sovereignty. “It is a very good time in Panama for international mining corporations, as foreign governments will be permitted to buy national territory. This is impossible and prohibited in Panama’s constitution,” commented Julio Yao, a professor of international relations at the University of Panama.
Panama contains several major copper and gold deposits. The two largest copper deposits are Cerro Colorado and Cobre Panama. Canada’s Inmet Mining Corporation, a publicly-traded company listed on the Toronto Stock Exchange, owns 100 per cent of the Cobre Panama concession, located in north-central Panama. The proposed open-pit mine site neighbours several Indigenous Ngobe and campesino (peasant) communities. The Cobre Panama project is expected to begin operations in the near future, pending approval of its Environmental and Social Impact Assessment.
Covering approximately 630 square kilometres, Cerro Colorado is the world’s fifth largest untapped copper reserve. The deposit lies in the heart of Ngobe territory in the rugged mountains of Panama’s interior.
There has been much speculation that Inmet’s need for financing for its Cobre Panama project underlies the introduction of Law 8. The stipulations of Law 8 would allow Inmet to obtain the massive start-up capital necessary to begin operations in Cobre Panama through previously illegal investment from foreign, state-owned companies. Prior to Law 8’s approval, state-owned LS-Nikko Copper Inc. of South Korea and Temasek Holdings Ltd. of Singapore expressed interest in backing the Cobre Panama project.
“Singapore corporations are putting pressure on [Panamanian President Ricardo] Martinelli, threatening that they won’t invest in Cobre Panama, worth millions of dollars, if Law 8 is not put in place,” commented Yao.
Due to the cancellation of the mining code revisions, neither LS-Nikko Copper Inc., nor Temasek Holdings Ltd. will be permitted to directly invest in the Cobre Panama project. Inmet must now seek alternative funding.
Indigenous and campesino communities surrounding Inmet’s project are divided on whether they support the copper mine. While some community members feel mining development would create jobs and increase community welfare, a strong resistance movement emerged as Law 8 was debated in the Legislative Assembly of Panama. Roadblocks were established and marches held on the road leading to the Cobre Panama project site.
The Cobre Panama project lies adjacent to the Molejon Gold mine owned by Petaquilla, a Panamanian corporation. This is the only mine currently in production in the country and is reputed for its poor environmental track record; community members have suffered from contaminated water. They have also endured harassment from company employees and fear similar fall-out from the Inmet project.
Due to the rejection of Bill C-300 (The Corporate Accountability of Mining, Oil and Gas Corporations in Developing Countries Act) by the Canadian parliament in October 2010, Canadian companies operating in Panama, such as Inmet, are not obligated to meet Canadian standards of operation. Given the history of Canadian mining injustices across Latin America, and the poor precedent set for mining regulation in Panama, it comes as no surprise that communities fear Inmet’s project will have a negative impact on their livelihoods.
Although Law 8 was most directly related to the development of the Cobre Panama project, the focal point of resistance lay in the Ngobe–Bugle territory surrounding the Cerro Colorado copper deposit. Ngobe leaders feared that opening Panama’s mining concessions to foreign enterprises would accelerate development of the Cerro Colorado project, violating their territorial rights.
"These mega-projects put at risk our territory and our natural resources. This has not been co-ordinated with the leaders of the Comarca [Ngobe territory] or with traditional authorities. They are violating our Comarca legislation," explained Celestino Mariano, traditional authority of the Nedrini region in the Ngobe Comarca.
The Ngobe are the largest Indigenous group in Panama. They have been fighting to protect their traditional territories from mining since prospecting began in the region in the early 1970s. Today, rising copper prices have renewed interest in the development of the area, including from Canada's Corriente Resources. According to Ngobe leaders, Corriente has been present in the community promoting sustainable mining opportunities through community capacity-building programs.
Law 8 pushed the Ngobe to new levels of opposition. Before the law came into legal effect, it passed through three rounds of debate in the legislative assembly in early February. As the first debate session began, over 500 Ngobe mobilized and took to the streets of San Felix, a small town located just outside the Ngobe territory. As word spread across the Ngobe territory, protests swelled to 3,000.
The Ngobe’s peaceful demonstrations were met by tear gas and police violence, leaving several with minor injuries. “We are a peaceful population,” said Eleto Martin, resident of the Ngobe community of Guabo. “So it was surprising that when 3,000 Ngobe demonstrated their rejection of Law 8, that instead of sending a commission to enter into dialogue with us, the government sent riot police.”
Despite opposition from the Ngobe and other civil society groups, Law 8 was passed on February 11, 2011. Immediately thereafter, waves of demonstrations spread across Panama. Protests in San Felix, a community of roughly 1,200 residents, grew to 10,000 people. Many protestors travelled several days by foot from the interior of the Ngobe Comarca to attend the marches.
Still unsatisfied with the government’s lack of response, the Ngobe intensified their efforts by establishing a four-day roadblock of the Transamerican highway. This effectively blocked the flow of people and goods through Panama.
Government and pro-mining groups attempted to delegitimize Ngobe protests by accusing outsiders of inciting Indigenous resistance. Daniel Esquivel of CAMIPA, a pro-mining lobby group whose member companies include Inmet’s Panamanian subsidiary, explained the uprisings this way: “Environmentalists and other outsiders opposed to mining transmitted these [anti-mining] ideas to Indigenous peoples and incited the Ngobe to rise in protest against Law 8.”
It was on these grounds that Francisco Gomez Nadal, a Spanish journalist freelancing for one of Panama’s national newspapers, was detained by police and deported from the country. The government blamed Nadal of encouraging Indigenous violence at an anti-mining protest held in Panama City on February 26.
The March 3 cancellation of Law 8 by President Martinelli came as a surprise to pro- and anti-mining groups alike. South Korea's government had already committed to help finance Inmet’s Cobre Panama project; Law 8’s repeal prevents such investments from proceeding.
Following Martinelli’s announcement of the repeal, Inmet stock price plummeted. Inmet immediately issued a press release attempting to appease investor concerns. The company claimed the project’s feasibility was not linked to Law 8 and that it would proceed with alternative funding. Industry representatives are certain that this project will become a reality, especially in light of recent core samples revealing higher-than-anticipated copper levels within the Cobre Panama concession.
With Inmet's Cobre Panama project looming on the horizon, the political atmosphere surrounding mining in Panama remains tense. The Ngobe realize that Cerro Colorado is still being eyed by the government for development. Mining in Panama remains an investment priority for Canadian companies. A Panama–Canada Free Trade Agreement was signed in 2009, promoting Canadian involvement in Panamanian industry. The mining industry is one of the major attractions for Canada’s participation in the Free Trade Agreement (FTA).
In hearings of the Standing Committee on International Trade last November, Don Clarke, manager of a consulting group working to promote what Clarke calls “sustainable mining” in Cerro Colorado, stated that, “Canadian industry, in our experience, is generally well received by people in Panama, and particularly in the Ngobe–Bugle Comarca, and we believe this is the biggest case that supports the FTA. In the case of mining, this industry needs to be founded, established, and legitimized in Panama.”
Despite Clarke’s assertions, the Ngobe have strongly demonstrated their opposition to mining development. The cancellation of Law 8 has been adopted as a platform from which they have called for a moratorium on all mining and hydroelectric projects in their territory.
Celestino Mariano confirms this position: “We [the Ngobe] know that consequences of mining are terrible, and we are working within our community to together stop mining projects in our Comarca.”
Dana Holtby and Rosie Simms are Montreal-based students and environmental organizers with a focus on water justice and Indigenous rights. They are currently travelling throughout Panama on a four-month field study semester.
The Dominion is a monthly paper published by an incipient network of independent journalists in Canada. It aims to provide accurate, critical coverage that is accountable to its readers and the subjects it tackles. Taking its name from Canada's official status as both a colony and a colonial force, the Dominion examines politics, culture and daily life with a view to understanding the exercise of power.