According to BNAmericas, mining investment in Peru is now less than half of what it was 10 years ago.
Former Economy and Finance Minister Luis Miguel Castilla said in an interview with local media that the development of the $53 billion mining investment project is not going well and Peru is missing out on the opportunities brought by increased copper demand.
A decade ago, mining investment in Peru was $9.5 billion to $10 billion a year, Castilla said.
According to the latest statistics of Peru's central bank, the country's mining investment in 2023 fell from $5.4 billion in 2022 to $4.6 billion, a decline of 14.1%.
"It's a bit of a paradox, prices are still high, there's a proven need for copper to accelerate the energy transition, and we don't have new projects and we don't have good due diligence," Castilla said.
While the market is expected to rebound this year as projects delayed by 2023 are likely to move forward, reducing bureaucracy and curbing informal mining and policies remain key.
"We have 85 million hectares of land occupied by organized crime. Similarly, we have a Congress that values land planning but does not intend to expand land development, but seeks to exclude it. The establishment of exclusion zones has led to illegal mining activities and we are condemned in our hearts ".
He added that about half a million people depend on illegal mining for their livelihoods, so the final solution cannot be left to emergency treatments alone, such as those in Pataz in the Lalibertad region.
"People are worried that informal mining is starting to spread to formal mining areas. The neighbouring region of Cajamarca, which is in the vicinity of Laliberta, may suffer from this situation as a result of the state power vacuum, as it is home to a large number of transnational criminal groups."
Some projects depend more on consensus among authorities, communities and companies than on environmental permits, he said. Southern Copper has all the permits for its Tia Maria project in Arequipa, but has been held up by a lack of social recognition. Regional governments will play a key role.
"The President of Arequipa region may support the project. Companies are creating conditions for water use, but need to remove the fear of decision making. The indecision of many central or regional governments has taken its toll and investment has been delayed and/or kept at relatively low levels, "Castilla said.
