The Risks of NGO Partnerships in Chilean Mining Towns
The presence of Barrick Gold (TSE:ABX) and other mining companies in the northern Chilean town of Copiapó, and the subsequent demand for labor, is expected to increase the town’s population by 45,000 by 2014. The companies’ heavy use of water resources could add to this number, as rural farmers displaced by water shortages migrate to the town. Copiano’s housing infrastructure is not keeping pace with the population increase, resulting in the rapid spread of slums.
In 2008, Barrick partnered with Un Techo para Chile, a local NGO focused on housing issues, to construct a residential complex for 125 families. Critics say the partnership will inhibit Un Techo para Chile’s willingness to publicly critique the company, thus costing the community a key representative in discussions about housing and other social and environmental impacts of the mining industry.
NGOs can be enticing partners for companies undertaking community development projects, due to their expertise in the relevant issues. However, such partnerships are often subject to criticism that they are detrimental to or do not address the needs of communities. Partnering directly with communities provides companies with heightened assurance that the impacts of community development projects will be felt by their intended beneficiaries.
Sources: Corporate Knights