The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
https://www.eltelegrafo.com.ec/noticias/economia/4/reformas-ley-recursos-hidricos-industria-minera
Apparently there are changes in the offing to the organic law of water resources, uses and exploitation of water. According to members of the Countries mining industry this would impact on legal and responsible mining activities.
There is then a load of stuff about why the change is wrong.
Then someone from the Ecuadorian Chamber of Mining said that through this reform the Constitution would be modified. Article 407 establishes that mining cannot be done in protected areas. The initiative intends to expand the restrictions in an antitechnical, whimsical (i had to check this one with my wife as Ive never come across it before in Spanish) and discriminatory manner. It would also creating legal chaos by generating contradictions in regulations.
It concludes with. If these reforms are materialized, investment and the entry of foreign currency would be stopped and the damage to the industry would extend to other productive sectors and may even open the door to the proliferation of illegal mining activities.
I had a look through other newspapers and couldn't see any other mention of this.
No specific mention to SOLG but might be of interest.
https://www.eltelegrafo.com.ec/noticias/economia/4/expertos-perspectivas-sector-minero-pais
The sub heading basically says mining is going from the future of the economy to being the most important thing today.
The rest is talking about the importance of the mining sector in terms of FDI and employment. Also talks about mining being important in marginalised remote areas where formal employment and the state dont really exist.
Talks about the next govenment needing to review investment protection treaties to better able to compete with Mexico, Chile etc. (The person talking at that point has skin in the game as he is trustee of the Ecuadorian chamber of mining).
https://www.eluniverso.com/noticias/2020/02/23/nota/7753641/asamblea-alista-nuevas-reglas-concesiones-mineras#cxrecs_s
If I get a chance later Ill translate properly. But basically its talking about changes to the mining law and to make new rules for awarding mining concessions. Its to make the process more transparent and cant see it being to SOLG detriment.
Apologies if already posted - been busy and not keeping up with whats posted.
https://www.eltelegrafo.com.ec/noticias/judicial/12/mineros-desalojados-buenosaires-marcha
The illegal miners from Buenos Aires have been protesting about them being botted out and demand to be allowed to continue as artisanal miners in an area. The government then tells them to take a running jump.
https://www.elcomercio.com/video/cronologia-fiebre-oro-buenos-aires.html
This is a timeline of whats happened with the illegal miners. Im afraid if you have no Spanish this wont be of much use as google translate wont work for you.
The local press report it a bit differently (more extensively).
The state of emergency will last for 60 days. The numbers of police, soldiers and prosecutors differs depending on the newspaper but its always large numbers.
They have removed -1200 people (again depending on the paper) but have 11 thousand to find and remove. The strategy is to cut off supplies to the miners to bring them out of the mountains.
Couple of videos
https://www.eluniverso.com/2019/07/02/video/7406877/2700-militares-policias-entran-zona-minera-imbabura#cxrecs_s
https://www.elcomercio.com/actualidad/buenos-aires-desalojo-mineria-ilegal.html
https://www.eltelegrafo.com.ec/noticias/judicial/12/mineroinformal-salariobasico-soldgold-arcom
An article on illegal mining in Equador from todays paper. It refers to SOLD GOLD which I assume is a typo :-)
This part of the article mentions 40 illegal miners being removed from El Cielito following a request from the concessionary company Sold Gold. This happened in April.
xraytom12 - thats standard for China they did something similar in Sri Lanka. Lent a ton of money to build a port, Sri Lanka cant pay so port now owned by China.
In relation to the chinese comment I was more talking about them losing the referendum. If it was a western company who treats the locals well who had lost then I would be more concerned.
In regards to having faith the government can overturn the decision as I said yesterday there is a process to follow. The fact China is involved wont change anything. As an example in Costa Rica there was a Project for the government to build a port. Im sure the government would eventually be able to overturn something it would just take time.
https://www.eltelegrafo.com.ec/noticias/economia/4/andresycaza-nueva-politica-minera-comunidad
Again this is more of an interview - this time with the vice president of the chamber of mining. As you would probably expect its on the side of SolG. Doesn't really offer anything new to be frank - other than setting out the new rules for consultations set out in the mining policy which was presented a few weeks ago.
I just had a very quick look as its lunch time.
The highest Judicial court is the National Court of Justice. Then separately the Constitutional court of Ecuador.
We are dealing with the latter. There judges are political appointees and there are 9 of them.1/3 renewed every three years. Wikipedia seems to think they are ignored. https://en.wikipedia.org/wiki/Constitutional_Court_of_Ecuador
If they are dealing with same sex marriage they are very busy as well as most of the papers are full of that.
It was in the link I posted before - this is the relevant bit - I have put quote marks where they did but I haven't necessarily quoted 100% accurately - just to the best of my ability.
The ministry of energy and natural non renewable resources presented last September an extraordinary protection action before the Constitutional Court, so that the measures imposed by the courts of first and second instance are lifted.
The department seeks to lift the suspension of the project and resume activities in Río Blanco, mentioned Fernando Benalcázar, deputy minister of Mines who said "We believe that the conditions that generated the sentences have been met,".
The Government refers to the fact that there was already popular consultation in 2018, when the country was asked about the mining development and that the plebiscite was validated by a judicial instance.
Yaku Pérez, legal prosecutor of the case against Río Blanco and prefect of Azuay, these arguments have no basis. He is anxious that the Court confirms the suspension of the project. "We are also waiting for the results of a special examination on this project from the Comptroller's Office".
As I understand it reading the papers they can but they have to challenge what caused the referendum. It seems the one that happened was all about water contamination.
If I get the chance later I'll look into the legislation though I must confess I am not sure if my Spanish is good enough for that. I may also see if I can persuade my Mexican wife to look (whose Spanish is obviously good enough - though whether she could be bothered is a different matter)
The power will have no impact. It's an independent judiciary. The government cant just overturn a decision - same as the UK fouldnt overturn a court decision in the UK.
The Ecuador government can work within the legal framework to overturn a decision but that's it. Yes they can also use legislation to change the requirements but it takes time and the Chinese cant really impact upon that.
Xraytom - Im actually reassured that it was a Chinese company that was impacted. My experience of Chinese companies working abroad is that they predominantly employ Chinese people wherever possible, dont really have a community outreach programme and spend as little as possible in the local market. If Solg are doing the usual western thing of providing jobs and doing community engagement you get a much better relationship with the locals who would be more likely to vote to get you to stay.
In other news that while not relevant may impact on the governments actions - both from latest newspapers.
Unemployment up and the local population being squeezed by Venezuelans (seems a lot have moved there).
GDP growth for 2019 has been revised down to 02.% from 1.4% Tha manager of the bank of Ecuador gave a number of reasons one being heavy mining and how it reacts to political, environmental and regulatory issues it faces.
https://www.elcomercio.com/actualidad/veronica-artola-proyeccion-crecimiento-ecuador.html
https://www.eltelegrafo.com.ec/noticias/economia/4/manodeobra-construccion-disminucion-ecuador