IN THE NEWS ~ Conflicts surrounding Canadian mines 'a serious problem'

But perceptions in Latin America are changing, say observers here and there, as conflicts pitting Canadian mines against local communities become entrenched and spread across continents, and the line between those companies and the Canadian government becomes increasingly blurred.

"Last week, there were demonstrations outside the Canadian Embassy in Mexico. But it's not just Mexico, it's throughout the region," says Daviken Studnicki-Gizbert, a history professor at McGill University and the coordinator of the McGill Research Group Investigating Canadian Mining in Latin America. "What embassy in Latin America has not been the locus of protests because of a Canadian mine?

"As a country and as citizens of this country we have a serious problem."

Canadian foreign direct investment in mining has nearly doubled in the last five years, from $23.8 billion in 2006 to $45.3 billion in 2011, and half of that was in Latin America.

Barrick Gold has spent $3.7 billion just on its Pascua Lama open-pit mine, on the border of Chile and Argentina, and expects to spend another $5 billion there before it's up and running in mid-2014. Then there's Cerro Casale, 130 kilometres north of Pascua Lama, currently on hold, for which Barrick would need to spend another $6 billion.

But as mining investment has exploded over the last decade, so too have conflicts involving Canadian mines, from the Pueblo Viejo mine in the Dominican Republic, where 25 people were injured in clashes with police in September, to the Pierina mine in Peru, where one person was killed that same month. (Both are mines owned by Barrick Gold, but protests are not restricted to Barrick mines.)

All the while the Canadian government's role in defending, even promoting, mining companies' interests has solidified.

Consider the apparent shift in priorities of the Canadian International Development Agency. Long mandated to reduce poverty in developing nations, critics say it is now targeting resource-rich countries with Canadian aid, especially where mining companies and communities are locked in conflict.

Last year it began a pilot project in Quiruvilca, Peru, near Barrick Gold's Lagunas Norte mine, where local residents have accused the company of contaminating the water supply and expropriating communal lands. CIDA has partnered with Barrick Gold, matching its funding for a $1-million World Vision project to provide loans for small businesses and to foster capacity-building for local leaders.

In development circles, the project, announced by then-minister for CIDA, Bev Oda, raised alarms over the mingling of private and public funds in a project whose result might have been to quell protest. In that light, CIDA's contribution - with taxpayers' money - was seen as a disguised subsidy to Barrick.

By April, however, it appeared the program had backfired. In a letter written to Oda, an association of community organizations from the three provinces in Peru affected by the Lagunas Norte project said it felt "cheated by these and other so-called social responsibility activities" and asked CIDA to stop supporting this type of project. Instead, CIDA should "monitor the activities of this company in our country, and coordinate with the state to ensure human rights of those affected by the mine are protected."

Oda never replied. But the new minister responsible for CIDA, former Toronto police chief Julian Fantino, wrote back in September, saying "more, not less, of these projects are needed if developing countries are to successfully transition to highly productive economies that enable free enterprise and empower free people to participate in global value chains and shape a more prosperous world."

It's a position Fantino has since reiterated, somewhat less eloquently. Canada's aid agency isn't getting into the mining industry, he assured reporters in November, but it is working with companies in developing countries so it doesn't have to "continually bail them out, with their food issues, their education, their health issues and on it goes."

In a speech to the Economic Club of Canada on Nov. 23, he called for an increase in support through CIDA of projects tied to Canadian mining companies working abroad.

"It's a new way of tying aid back to our economic interests, and shifting aid toward natural resource-rich areas," says Jennifer Moore, the Latin America program coordinator for Mining Watch Canada, a non-governmental organization based in Ottawa.

"CIDA used to be seen as a great thing," said Studnicki-Gizbert. "Now it's seen as an arm of the mining industry - do we want that?"Perhaps in response to some of the criticism that it has become too cozy with mining corporations, the Harper government in 2009 established a complaints office of sorts for people in other countries unduly affected by a Canadian mine.

Known as the "Extractive Sector Corporate Social Responsibility Counsellor," its role, as an institution reporting to the Department of Foreign Affairs and International Trade, is "to communicate the Government of Canada's expectations regarding corporate conduct, assist companies and stakeholders in the resolution of disputes related to the corporate conduct of Canadian extractive companies (mining, oil and gas) abroad, and assist with the implementation of CSR performance standards." The office has a $650,000 annual budget.

Unfortunately, when it comes to dispute resolution, the counsellor's hands are tied. Marketa Evans, the first director of the Munk Centre for International Studies - built at the University of Toronto and maintained with $41 million in grants from Barrick Gold founder Peter Munk - was appointed CSR Counsellor in 2010. But the government's mandate only gives it the power to investigate complaints as long as the mining company in question chooses to cooperate.

So far, two out of three files the counsellor has opened pertain to mining operations in Latin America, and in both cases, investigations came to an abrupt end when the company refused to participate.

The first involved an Excellon Resources mine in Durango, Mexico, where the company was accused of illegally occupying lands, affecting the water supply and denying workers the right to unionize. The second cited McEwan Mining's Los Azules mine in Argentina's San Juan province - where Barrick's Pascua Lama mine is being developed.

In the McEwan case, two local environmental groups filed a complaint to the CSR counsellor in July, presenting satellite imagery of glaciers being affected by McEwan's exploration activities, including of mining roads cutting across some of the glaciers.

At the end of November, having reviewed the evidence, Evans issued a report recognizing the two groups as legitimate stakeholders, and proposing mediation. That's when McEwan promptly withdrew from the whole process, and the file was closed.

Repeated calls to the CSR counsellor's office were not returned.

Asked to comment on whether the office was an effective means of resolving such conflicts, a spokesperson for DFAIT referred The Gazette to a written statement.

"Through our Government's Corporate Social Responsibility Strategy, we want to help these companies remain world leaders and continue creating jobs and opportunities in Canada and abroad," wrote Caitlinn Workman. "The Counsellor contributes to problem-solving through her review and advisory functions."

Moore, of Mining Watch Canada, doesn't blame Evans per se, but rather the government for not giving her the resources or range of powers necessary to properly address the conflicts arising.

"She can't investigate, make policy recommendations, apply or suggest sanctions," said Moore, who says the government should create a true ombudsman's office that is independent. "The CSR counsellor was a political invention of the Canadian government to give the appearance of having an office of complaints but instead falls far short . especially where egregious human rights and environmental damage are involved."Despite domestic and international calls to bring Canadian mining companies under control, DFAIT, National Resources Canada and CIDA seem increasingly supportive of their interests.

According to Moore, Canadians are both subsidizing the mining companies and profiting from them, through pension plan and group investments in Canada's mining giants - sometimes knowingly, sometimes not.

Following the defeat of Bill C-300 - the Responsible Mining Bill - in 2010, Moore and other advocates are now supporting a private member's bill, introduced in February by MP Peter Julian, that would allow foreign citizens to take their grievances of human rights abuses and environmental degradation to Federal Court.

"A lot of Canadians would be scandalized to think our public sector funds and efforts are directed oversees at some of the most predatory companies," Moore said. "We shouldn't be making our living at the cost of other people's future and well-being."

If we are to salvage Canada's reputation, says Studnicki-Gizbert, the federal government must establish in people's minds the difference between the Canadian government and Canadian companies, and show that the government is holding them accountable.

"Instead they're doing the exact opposite."


[email protected]  Twitter @csolyom Last of a three-part series

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