Industry pushes back on proposal that could lead to nationalization of Chile’s copper sector
An early stage proposal that could lead to the nationalization of Chile’s copper industry was approved by that nation’s constituent assembly.
The proposal, “for the Nationalization and New Social and Environmental Management of Copper Mining, Lithium and other Strategic Assets” was greenlit by the environmental commission of the assembly, which is drafting Chile’s new constitution.
The approval sparked an angry response from mining firms operating in Chile.
“The proposal adopted is barbaric, with clear and obvious legal errors,” said Diego Hernández, president of the National Mining Society, which represents companies in the sector.
He said the measure would nationalize companies themselves as well as just the metal resources and would have a major economic and legal impact.
“A nationalization would have serious consequences for our economy in a context of globalization, since the affected companies will resort to these treaties to defend their legitimate interests,” he added.
The proposal would still face a vote from the full assembly to be included in the final draft text, which would itself go before a national referendum vote later this year,” Reuters reported.
Chile is rewriting its Constitution to replace a market-centric one that dates back to the military dictatorship of General Augusto Pinochet. Debate on the draft will start in earnest later this month, but proposals have already started to cause jitters in some sectors.
The mining industry has called for preserving legal protections to ensure future investments in the sector in the world’s largest copper producer and the second-largest lithium producer.
Members of the Constitutional assembly have pointed out that the proposal could be adjusted or even scrapped.