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Mining in Latin America 

January, 2014 - RAFAEL VERGARA

Governments are placing pressure on mining companies to take a greater role in supporting the broader community through social and logistical infrastructure, community developments, local hiring, and procurement and training practices. 

 

Latin America slips but stays on top 

 

In the last years, the region maintained its leading position in attracting mining investment, with 28 per cent of the total investment pipeline (source: Engineering and Mining Journal 2012), though the mining exploration has declined and new exploitation projects or expansions have been slowed by global economic uncertainty, volatility of markets, softening commodity prices, and higher input costs. 

 

Notwithstanding this, the region is being targeted for inbound investment; this is partly due to the scale of opportunity where much of the region is yet to be subjected to vast exploration and partly a result of the relative attractive regulatory environment of countries such as Chile, Peru, Colombia and Mexico, which are well positioned to supply the global market. 

 

The region has also benefited from these facts and continues being a very important target of many international mining companies. Thus, 25 per cent in 2012 of the world’s total investment in nonferrous exploration were spent in our region, keeping its position from 1994, as “the most popular exploration destination” (source: Metals Economics Group). New high-grade deposits are being discovered and new resources and reserves are being identified in the mines under exploitation. Even though most of the projects that were frozen in 2008–09 were back on track in 2010--–11, and a quarter of world investment is attracted to this region, it is perceived that the construction and expansions of projects are slower and more difficult, mainly due to the factors mentioned below.

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