Mining minister Ivan Merino said that Peru’s government intends to rewrite mining laws in general and legislation that establishes royalty payments.
The country of Peru is the world’s second-largest producer of copper. President Pedro Castillo, a socialist, wants to increase mining company taxes to pay for social initiatives, but he has provided few specifics since taking office in July. Peruvian miners’ stock prices have dropped because of concern about the potential effects of these developments.
According to Minister Merino, who spoke at the mining industry’s Perumin conference, the country’s “General Mining Law,” the legislative framework that governs the industry, has to be redrafted. Without specifics, Merino stated that any new mining operations in Peru’s Andes should have a “neutral impact” on the people near the mines, typically indigenous populations. Merino said that he wished to increase the adaptability of such resources.
Peru’s fractured Congress must approve either change, and experts predict that this will lead to stalemate rather than transformation. The Peruvian government plans to build a railway to carry metals from the Andes to the coast, with $50 billion.
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The government wants miners to concentrate on “social profitability,” which he repeated, and many CEOs have indicated they support.
When asked about Peru’s “historic potential” to profit from the increasing demand for copper, Rag Udd, the American president of BHP Group Ltd, which has a stake in the Antamina mine there, said: “Peru confronts a historic opportunity.”