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Panama President Approves Moratorium on New Mining Concessions, Canadian Mine Remains Untouched

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Panama Implements Indefinite Moratorium on New Mining Concessions

Panama's President, Laurentino Cortizo, has signed a law enacting an indefinite moratorium on new mining concessions in the country. The law also prohibits the renewal of existing concessions. While the bill was approved by Panama's National Assembly, it did not include the revocation of a controversial mining contract that has sparked nationwide protests. The contract allows Minera Panama, a subsidiary of Canadian mining company First Quantum, to operate an open-pit copper mine in the state of Colon for 20 years, with a possible extension for another 20 years.

Environmental Concerns and Legal Implications

Environmentalists argue that the mining operation poses a threat to the surrounding jungle and local drinking water. Lawyers have welcomed the decision to retain the mining contract, as revoking it could have exposed the government to significant legal liabilities. However, there are ongoing legal challenges against the contract, and if the country's Supreme Court deems it unconstitutional, the liabilities may be avoided. Additionally, there is a pending bill that proposes subjecting the contract to a popular referendum.

Continued Protests and International Precedent

Despite the enactment of the moratorium, protests against the mining operation continue across Panama. Indigenous groups and unions from various sectors, including education, construction, and healthcare, have joined in the demonstrations. It's worth noting that in 2017, El Salvador became one of the first countries to pass a total ban on metal mining, citing the need to protect the water supply. In conclusion, Panama's implementation of an indefinite moratorium on new mining concessions reflects the government's response to environmental concerns and public pressure. The decision to retain the existing mining contract while facing legal challenges showcases the complexities of balancing economic interests and environmental protection. The ongoing protests highlight the significance of public engagement and the potential for popular referendums in shaping mining policies.

Hot Take: Panama's Moratorium on New Mining Concessions and its Impact on New Businesses

The recent decision by Panama's President, Laurentino Cortizo, to implement an indefinite moratorium on new mining concessions is a significant development that could have far-reaching implications for new businesses in the mining sector. This decision, influenced by environmental concerns and public pressure, highlights the increasing importance of environmental sustainability in business operations.

Challenges and Opportunities for New Businesses

For new businesses, this development presents both challenges and opportunities. On one hand, it restricts the expansion of mining activities, potentially limiting growth opportunities. On the other hand, it underscores the need for businesses to adopt sustainable practices and consider the environmental impact of their operations.

Legal Implications and Public Engagement

The ongoing legal challenges and the potential for a popular referendum on the mining contract highlight the complexity of navigating the legal landscape. It underscores the importance of legal due diligence and the need to engage with local communities and stakeholders.
Lessons from International Precedents
The reference to El Salvador's total ban on metal mining serves as a reminder of the growing global trend towards environmental protection. New businesses must be cognizant of these trends and adapt their strategies accordingly. In conclusion, while Panama's moratorium on new mining concessions presents challenges, it also offers opportunities for new businesses to innovate, engage with stakeholders, and prioritize environmental sustainability.
Story First Published at: https://financialpost.com/pmn/business-pmn/panama-president-signs-into-law-a-moratorium-on-new-mining-concessions-a-canadian-mine-is-untouched
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