2/2/2023 - Economy and Finance

Why Peru?

By jorge santa cruz

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Imagen de portada
Imagen de portada

The crisis in Peru has a local component – the fierce struggle for power between the right and left factions – and another, global: the interest of the two economic superpowers, the United States and China, for the mineral wealth of the Andean country.

Second Mining Investment Guide in Peru (2022-2023), co-edited by the Ministry of Foreign Affairs of Peru and the company EY Peru, the Peruvian nation occupies the second world place among the producers of copper and zinc, and the third among the producers of silver and tin. In Latin America, Peru is the first producer of zinc, tin, lead and selenium.

The above-mentioned publication brings other significant data: only 1.07 % of the Peruvian territory is exploited by the mining industry (which is dominated by foreign companies) and was only exploited 0.28 % more.

The main foreign mining companies based in Peru are as follows:

  • Freeport-McMoran (Green Hill)
  • MMG Limited (Las Bambas)
  • BHP Billiton (Antamine)
  • Southern
  • Glencore (Antapaccay)

United States interests

[caption id="attachment_ 7509" align="alignleft" width="240"] General Laura Richardson, head of U.S. Southern Command. Photo: US Embassy and Consulate in Ecuador[/caption]

On January 19, the head of the U.S. Southern Command, four-star general Laura Richardson, stated in the Atlantic Council that Latin America is important to its country for its mineral wealth:

“With all your rich resources and rare earth elements, you have the lithium triangle, which is today necessary for technology. 60% of the world’s lithium is in the triangle of lithium: Argentina, Bolivia and Chile”.

The head of the U.S. Southern Command included in its inventory the oil reserves discovered in front of Guyana, as well as the oil, copper and gold of Venezuela. Also, to the Amazon forest that has – according to its words – 31 % of the fresh water of the world.

The Peruvian connection

The President of the United States, Joe Biden, is the main visible promoter of the energy transition based on the production of clean energy, such as solar and wind.

Energy transition technologies need metals like lithium, copper and silver. Peru is the second world producer of copper and the third, silver. Also remember that 98 % of its territory has not yet been exploited by the mining industry.

In the previous, suppose you, kind reader, that the deposed Peruvian President Pedro Castillo had the purpose to consult the citizens of your country if they agreed to give Bolivia a way out to the sea.

Let us form a logical inference: if the government of Bolivia – currently in charge of leftist Luis Arce – could do business with lithium through the Pacific Ocean, would do so with China, not with the United States.

The Arce government sent a clear signal to Washington on January 20 – one day after the U.S. Southern Command leadership, Laura Richardson, in the Atlantic Council – authorizing the Chinese company CATL BRUNP & CMOC (CNC) to extract lithium in the Andean regions of Oruro and Potosí.

China, on the other hand, already has an important presence in Argentina and Chile through specialized lithium processing companies such as Ganfeng Lithium, Tianqi Lithium and Zijin Mining.

Why Peru?

Because the mineral riches of the South American country interest both Washington and Beijing.

Peru is the victim of destabilization not only by the ambitions of the internal factions, but because external interests want to control their mineral wealth. Peruvians put dead, wounded and divided families, while magnates from other latitudes rub their hands. It's a story that repeats itself.

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jorge santa cruz

jorge santa cruz

Hello, my name is Jorge Santa Cruz, I am an independent Mexican journalist, university professor and communication consultant. I started my journalism career in 1981 and my teaching career in 1991.
I have witnessed how my country passed from the rule of the single party to the empowerment of right and left parties; also, how it moved from the government-controlled economy to the market economy. Currently, the Mexican government intends to return to the socialist economic model.
As a journalist, I have seen how the rule of law in Mexico has been weakened for the benefit of organized crime.
At the international level, I have shared information and analysis about, for example, the Chernobyl tragedy, the fall of the Berlin wall, the dissolution of the Soviet Union, the neoliberal empowerment, the two wars in Iraq, the two recent wars in Afghanistan and the emergence of multipolarity.
I have the vocation to deepen the meanings of the news so that those who have to read me can, at a given time, broaden their points of reference.

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