Balancing Economic and Social Development in Peruvian Mining Communities

March 14, 2013

In January 2013, at least a dozen people were injured in clashes between police and members of a Quechua community at Candente Copper Corporation's Canariaco Mine in northwestern Peru. The Peruvian government admits to over 200 conflicts between mining companies and Indigenous communities in the country, many of which turn violent. The Peruvian government’s plans to auction Indigenous territory for oil development in early 2013 will only further exacerbate these conflicts.

The civil unrest spurred by development presents a challenge to Peruvian President Ollanta Humala, who was elected on a social democratic platform that pledged support for communities in such disputes. The social programs promised by Humala’s administration depend on revenue generated from mining and oil development. In August 2011, Ollanta addressed this challenge by passing a law requiring consultation with Indigenous Peoples affected by development, claiming the reduction in social conflict would spur foreign investment. Indigenous organizations declared that for the consultations to be effective, their decisions must be respected.

The delicate balance between economic development and Indigenous Peoples’ rights in Peru poses both risks and opportunities for companies operating in the country. If conflicts with Indigenous Peoples continue to jeopardize the viability of an industry so crucial to Peru’s growth, the country may enact tighter regulations and restrictions on companies that fail to respect Indigenous Peoples’ rights. On the other hand, companies developing best practices towards Indigenous Peoples can take advantage of the country’s desire to prioritize both economic and social development.

Sources: Financial Times, International Press Service

This article was originally published in the Corporate Monitor by First Peoples Worldwide, a nonprofit focused on funding local development projects in Indigenous communities across the world.