MAC/20: Mines and Communities

Free Trade and Resistance in Guatemala

Published by MAC on 2005-05-02

Free Trade and Resistance in Guatemala

By Mychalejko, Alternet

Posted May 2, 2005.

On January 11, 2005, Guatemalan President Oscar Berger spoke to a group of reporters in Guatemala City about ongoing protests against a World Bank mining project in the northern part of the country. He said that his government had to establish law and order.

"We have to protect investors," said Berger.

Hours later the Guatemalan military and police forces armed in riot gear opened fire on protesters, murdering one man and leaving dozens injured. Berger's comments about establishing law and order in Guatemala to protect investors and the ensuing violence and state repression that followed that day and in the following months are not isolated incidents indicative of that country's democratic shortcomings. Rather they illustrates the violent forces employed to secure the expansion of capitalist globalization being forced on people through neoliberal reforms and free trade agreements pushed by transnational corporations, Northern governments, and international lending agencies.

All That Glitters Isn't Gold

Glamis Gold, a mining company incorporated in Canada with headquarters in Reno, Nevada, was given a $45 million loan from the World Bank to construct and operate a gold and silver mine in San Marcos, Guatemala, 90 air miles from Guatemala City in the country's western highlands. Two of the towns directly affected by the project are San Miguel Ixtahuacan, and Sipacapa, whose populations are 98 percent and 77 percent indigenous.

The Guatemalan government ratified International Labor Organization Convention 169 on Indigenous and Tribal Peoples, which ensures (at least on paper) indigenous people's land rights and rights to self-determination. Articles in the Convention state that indigenous communities must be consulted and allowed to participate in decision-making processes in any matters concerning their land and lives.

The World Bank has similar procedural "safeguards" to ensure only projects with "broad community support" are approved. Unfortunately, the ambiguous language coupled with lack of independent oversight and enforcement mechanisms allows transnational corporations like Glamis and global institutions like the World Bank to set their own standards.

According to Sandra Cuffe of Rights Action, a human rights and community development organization, local community members said people were asked to sign their names to receive lunch at Glamis presentations. They now suspect Glamis used the lunch lists to claim they 'consulted' people. Cuffe works in Honduras, has traveled to Guatemala and has monitored Glamis' mining operations in both countries. She is the author of a report on mining and neoliberal reforms in the two countries titled, "A backwards, upside-down kind of development: Global actors, mining and community-based resistance in Honduras and Guatemala."

Graham Saul, International Program Coordinator for Friends of the Earth Canada, has been monitoring the project and agrees the "consultation" process is largely a charade. "Consultation is more of a public relations exercise than a meaningful legal process. It gives companies like Glamis and the World Bank cover [where they can say]: 'Yes we consulted and yes there is popular support,'" said Saul.

Needless to say, both institutions claim the project has broad support. But an article in the Guatemalan newspaper Prensa Libre contradicts their claims. The article cites a survey conducted by the Vox Latina Institute in which 95 percent of people living in San Miguel Ixtahuacan and Sipacapa who were surveyed oppose the mining project. A majority of people believe that mining would harm the environment and not benefit their communities. These people are right. The local communities sustain themselves largely through farming and raising livestock. As a result of the project, which is in its construction phase, many of the people have been evicted and relocated from land they have lived on for generations.

"They don't have any say on whether they want to be moved, where they are moved to and what kind of housing they will receive," said Cuffe.

There have also been reports that one community which was relocated went weeks without access to drinking water.

"The rights of indigenous peoples in Guatemala have been trampled on for hundreds of years. Now they are being told their land has been parceled out to foreign mining companies, most of them Canadian. This is a recipe for disaster - both human and environmental," said Saul.

But the human rights violations just begin there. The mining project will bring long-term social and environmental destruction. The open-pit mining operations will consume vast amounts of water, which could make water used for irrigation of farmland scarce. Glamis is not required to pay for the use of water. Any water that is left available for local communities to use for farming and livestock and the immediate ecosystem can also be expected to be contaminated by cyanide, which is used for the extraction of gold, and other harmful chemicals and debris associated with open- pit mining. Alcohol, prostitution, sexual assault and rape also are often commonplace in mining camps in Latin America.

Now, Glamis and the World Bank will counter that the project will bring employment for many locals, but most of these jobs will be terminated after the construction phase. In addition, Glamis is also building infrastructure that includes roads, new homes, schools, and medical clinics. Guatemala will also receive up to 3 percent in royalties.

Jamie Kneen, communications and outreach coordinator of the Canadian NGO Miningwatch., calls this window dressing.

"If you're destroying productive farm land, dislocating people and destroying water supplies you're going to need more than a school to compensate," said Kneen.

He added that in ten years time the mine is expected to be closed and Glamis is not obligated to fund the maintenance and operating costs for the infrastructure projects that the company touts as benefits. Whatever paltry royalties the Guatemalan government will gain from the project can be expected to be tied up repairing "unforeseen" environmental damages. He said that the so called benefits Glamis are offering is nothing more than an exercise in public relations.

"It's a lot easier to buy PR. When you add it up it amounts to very little money," said Kneen, "nothing compared to the value of the resources extracted or reasonable royalties."

"Bread Today, Hunger Tomorrow"

On December 3,2004, more than 2000 indigenous farmers and villagers gathered to block a convoy traveling on the Pan-American Highway carrying mining equipment from reaching the Marlin site.

This organized opposition resulted from what many local people perceived as lack of consultation and access to decision making along with the widespread belief that the project would destroy their environment and way of life. Though the numbers dwindled, the blockade lasted 40 days until Jan 11, when Guatemala's Interior Ministry deployed the military and security forces to "protect investors."

The security forces used tear gas and fired their AK-47's into the crowd. Raul Castro Bocel, a 37 year-old campesino from Solola, was killed. The company issued a press release stating, "Glamis is saddened that this criminal activity may have resulted in injury and loss of life." Unfortunately, Glamis wasn't referring to the criminal activity of the Guatemalan military and police forces, who, when they fired into the demonstration, violated provisions of that country's 1996 Peace Accord which ended Guatemala's 36 year civil war. Provisions in the Peace Accord were established to set up safeguards to ensure that state-sponsored violence that had resulted in a genocidal campaign against the country's indigenous peoples populating most of the rural areas. Glamis blamed the confrontation on "anti-development activists" and their "misinformation" rousing the local population. Its press release went onto reconfirm that "the project continues to be strongly supported by local residents." The World Bank also posted a statement on its website in response to the murder and state repression. It stated that the Bank was "in frequent contact with the company and the government as concerted efforts were being made to find a peaceful resolution." Conspicuously missing was any mention of the World Bank having any dialogue with the local protesters. Then again, why would it change its practices at this point in the project? The Catholic Church in Guatemala has also been an outspoken critic of the mining project and has been heavily involved with the organized resistance to it. And it is also not immune from the violence. The Guatemalan Human Rights Commission announced that a former intelligence officer reported being offered $50,000 by an anonymous woman to assassinate San Marcos Bishop Alvaro Ramazzini. Berger responded by putting the bishop under government protection. Ramazzini has been a vocal supporter of campesinos' organizing efforts against mining.

Despite the atmosphere of intimidation, local opposition to the mining project has not only sustained itself but continues to grow. Reuters reported ("All's not gold to Guatemala's Mayans", 02/28/05) thousands of Mayan Indians gathered for an anti-mine march organized by the Catholic Church shouting, "Bread today, hunger tomorrow!" to express their belief about the benefits of the mining project.

"We don't want gold; what we want is to defend our way of life and our water," peasant farmer Timoteo Tujil told the Reuters.

And it's not just the way of life that needs to be defended. On March 13 Alvaro Benigno Sanchez, the 23-year-old son of an outspoken critic of the Marlin project was shot and killed by an off duty security guard working for a local company hired by Glamis.

Protecting Free Trade

Bilateral and regional free trade agreements are another mechanism used by transnational corporations and northern governments to open new markets and protect the investors who pillage them. Coincidentally, Glamis is no stranger to free trade.

Glamis is suing the U.S. government for $50 million in lost profits under investor rights provisions contained in Chapter 11 of the North American Free Trade Agreement due to the decisions of the federal government and the state of California to halt the company's open pit mining project which lies on sacred Native American sites in the southern part of the state.

This has interesting implications for Glamis' project in Guatemala. The Central American Free Trade Agreement (CAFTA), which is essentially an extension of NAFTA, contains similar investor rights provisions. This raises the question as to whether Glamis could use the same arbitration process, which includes no public access or oversight, should the growing resistance to the Marlin mine succeed in ending the project.

Thousands of protesters, including indigenous farmers, trade unionists and students, converged on the country's capital in early March when CAFTA was set to be voted on by lawmakers. The vote on the free trade deal, which has little public support outside of government officials and wealthy landowners, had to be postponed a day due to the ongoing demonstrations. Protesters were demanding a national referendum to let the people decide what is best for them and their country. President Berger, never shy to "protect investors," sent in troops to quell the protests. What ensued was the murder of two more countrymen and more violence. In addition, Amnesty International reported that two journalists were threatened with death if they continued covering the anti-CAFTA demonstrations. Congress voted overwhelmingly in favor of CAFTA and Berger ratified the agreement on March 15.

Bishop Ramazzini issued a statement articulating why the demonstrators were opposed to the free trade agreement at a press conference during the protests.

"CAFTA was negotiated behind people's backs, and this is the reason that people today are now protesting. It is based on the logic that favors profits over human rights and sustainability," said Ramazzini. "It's clearly intended to facilitate the accumulations of capital to complement and lock into place the neoliberal reforms carried out by the governments in the region."

CAFTA has also been ratified by the other Central American countries in the region and awaits approval by the U.S. government to finalize the deal. Despite widespread opposition to CAFTA in the United States, largely due to the debilitating effects NAFTA has had on the U.S. and economy, workers' lives (as well as strong disagreement from the sugar industry), a vote is expected in May. Some Republican lawmakers are breaking ranks with the president on this issue but the administration and free trade obbyists representing transnational capital are cashing in favors and cutting deals as CAFTA is recognized as a stepping stone to passing the Free Trade Area of the Americas.

Silence is Golden

The global response to the violence and violations of international law in Guatemala has largely been muted. The media's coverage in Canada has been sparse at best.

"A Canadian mining company having a devastating impact on foreign countries and their ecosystems is far too common to be considered newsworthy," said Saul of Friends of the Earth.

In the U.S., with the exception of a couple of wire stories, the media has been to busy covering more pressing matters, mainly the Michael Jackson case and the death of Terry Schiavo.

There have been no constructive responses by Northern governments. Canadian Ambassador to Guatemala James Lambert wrote an oped published in Pense Libre extolling the virtues of mining as a tool for development by comparing mining projects affecting indigenous populations in Canada to potential ones in Guatemala.

"Through sustainable development of our mining resources, these communities are creating the economic, cultural and social infrastructure necessary to secure their future and the future of their children," wrote Lambert.

The claim that indigenous communities have benefited is dubious at best, while the comparison of Canada to Guatemala is completely inappropriate due to the gross economic, social and political disparities between those two countries.

The U.S. government in turn has rewarded the Guatemalan government for its commitment to neoliberal reforms and protecting investors by resuming military aid to the country for the first time in 15 years with a $3.2 million package; this in the wake of the recent murders and violence and a State department human rights report released in February which criticized Guatemala's National Civil Police to be the worst human rights violator in the country.

Global civil society must engage itself in solidarity work with the people in Guatemala as the World Bank, Glamis Gold and the Guatemalan government have forced them to literally fight for their lives and way of life. We must make it clear that the violence, repression, exploitation, racism and environmental destruction inherent with the nature of capitalist globalization are unacceptable. Here in the U.S., defeating CAFTA must be a priority because of both the short term and long term implications in stopping this "backwards, upside-down kind of development."

A spokesperson for transnational capital, Jorge Arrizurietta, president of Florida FTAA put it best when he recently said, if the campaign to approve CAFTA "is not successful, the FTAA is for the history books...The free trade movement will be stalled."

If we do our work right stopping both is within our reach.

Communications Director of the Florida Fair Trade Coalition ( and a free lance journalist. I can be reached at

Skye Resources project in Guatemala

By Frank Jack Daniel, Reuters

5th May 2005

Guatemala City - Canada's Skye Resources Inc. has started drilling at a long dormant Guatemalan nickel project and hopes to start production on time in 2008 despite delays and local opposition to the project.

Skye said it expected to complete a feasibility study at its Fenix project in eastern Guatemala within 12 months, despite a delay in getting drilling equipment to the site.

"Drilling started a week ago Friday with one drill, about a month behind what we'd have like to have been. The second drill has now started," Skye Chief Operating Officer David Huggins told Reuters late on Wednesday.

Huggins said that subject to Skye receiving the right licenses, part of the mine should go online in 2008.

"The optimistic schedule is that if we are able to get (the feasibility study) done in a year, we would like to get the first line on 24 months after that, and the second line, the doubling of the thing, after about 36 months," he said.

The Fenix project was previously known as Exmibal and was jointly-owned by Inco and the Guatemalan government. It was mothballed in 1980 amid rising fuel prices and collapsed nickel prices.

Exmibal used to produce 11,000 tonnes of nickel a year. Skye aims to raise that to 20,000 tonnes a year after an estimated $540 million investment over the next 5 years.

Under the terms of a 2004 deal, Vancouver-based Skye got Inco's 70 percent-stake in Exmibal, a company formed to exploit the nickel project and processing plant in eastern Guatemala, if the miner can bring it up to active mine status.

Skye would like to buy the remaining 30 percent still in government hands. The miner faces a number of hurdles before it can begin production -- including high fuel prices, community opposition and an ambiguous government position on issuing new mineral exploitation licenses.

Several outspoken critics of the Exmibal project were assassinated in the 1970s during military regimes and there is stiff opposition to the renewed project in Maya Indian villages that fringe the property.

Even as the company works hard to shake off the past, this year investing $500,000 in a community development fund, the project has not shed its critics.

"The communities have serious concerns and fears about this project, and at the same time, have a real small scale economy based on the sale of cardamom and other crops that would be jeopardized if not destroyed should the project go ahead," said Daniel Vogt of Aepdi, a local Mayan Indian development group. Skye has promised to compensate farmers for lost crops.

Anti-mining feeling ran high in Guatemala early this year when a villager was shot dead after peasants tried to blockade a highway another miner was using to transport mine equipment.

Following the incident Guatemalan Vice-President Eduardo Stein said the government would not issue more mining licenses while it waited for a commission to look at ways of reforming the country's mining law.

(Editing by Christian Wiessner; Mexico City newsroom)

Guatemalan farmer blockades stop Skye drilling

By Frank Jack Daniel, Reuters

Friday, 10 June 2005

Guatemala City - Drilling was stopped for several days at a Guatemalan nickel project this week when Mayan Indian locals brandishing machetes felled trees to block an access road, a project spokeswoman said on Friday.

The stoppage, now over, was the latest outbreak of anti-mining feeling in Guatemala, which is keen to attract investment to exploit gold, sliver and nickel reserves.

Canada's Skye Resources Inc. was forced to stop exploration and move its machinery to another part of the property after local farmers accused the miners of drilling on the wrong side of a line dividing community-owned land from company property.

"When they blocked the road they chopped down trees. There were about 40 people with machetes. We turned around and went back," plant manager Arnoldo Garcia told Reuters by telephone.

Company spokeswoman Regina Rivera said Skye agreed to change its exploration plan after negotiations with the Las Nubes community, which sits near the disputed boundary.

"We listened and they told us the reasons they want us to leave -- because the territorial line is not clear," Rivera said. "We don't want problems with these people, we want to respect them totally, and if they don't like it we pull back."

Skye said drilling, which only started in May, had now resumed further away from the community. The company said it would not drill on the disputed land until government surveyors had ruled on who it belonged to.

In the absence of definitive land ownership laws, land disputes in Guatemala frequently simmer for many years. Resistance to mines was strong in Guatemala early this year when a villager was shot dead in clashes with security forces after peasants blocked a highway another miner was using to transport mine equipment.

Daniel Vogt, who represents local Mayan development group Aepdi, said he was pleased violence had been avoided at the Skye project but said the dispute s howed why it was important to adhere to International Labor Organization (ILO) rules. "I am pleased the company is not using repression to force the community to accept a proposal allowing them to stick to their own time table, but this is another case where if (ILO) 169 had been complied with, the situation would not have occurred," he said.

The ILO's Convention 169 is an agreement signed by Guatemala that requires community consultation before exploration of subsoil beneath indigenous communal lands.

Reporting by Frank Jack Daniel in Guatemala; Mexico City newsroom

Campesinos guatemaltecos frenan perforaciones de Skye Resources

Por By Frank Jack Daniel

Viernes 10 de junio, 2005

Guatemala - Trabajos de perforación en un proyecto de extracción de níquel fueron detenidos esta semana en Guatemala. Un grupo local de indios maya derribaron árboles con sus machetes bloqueando el camino de acceso, aseguró un vocero del proyecto.

Esta detención constituye la última expresión de un sentimiento anti-minero en Guatemala, que es un país abierto a la inversión para explotar oro, plata y níquel.

La compañía canadiense Skye Resources Inc. fue forzada a paralizar los trabajos de exploración y mover su maquinaria a otro sector de su propiedad, luego de que campesinos locales la acusaran de perforar del lado equivocado de la línea que divide las tierras de la comunidad y las de la empresa minera.

"Cuando bloquearon el camino, voltearon algunos árboles. Había unas 40 personas con machetes. Nos dimos la vuelta y nos fuimos" dijo el gerente de planta Arnoldo Garcia a Reuters.

La vocera de la empresa, Regina Rivera, dijo que Skye accedió a cambiar su plan de exploraciones luego de negociar con la comunidad Las Nubes, próxima al terreno en disputa.

"Los escuchamos y nos dijeron las razones por las cuales quieren que nos vayamos, y es porque la línea territorial no está clara" dijo Rivera. "No queremos problemas con esta gente, queremos respetarlos totalmente, y si no les gusta lo que hacemos nos retiramos".

La resistencia a la minería ha sido fuerte en Guatemala a comienzos de este año, cuando un poblador fue asesinado durante enfrentamientos entre manifestantes que bloqueron una ruta y fuerzas de seguridad. El bloqueo se originó por el traslado de equipamiento minero.

Daniel Vogt, quien representa un grupo local de desarrollo maya (Aepdi), dijo estar satisfecho porque se evitó la violencia en este caso, pero opinó que la disputa revela la importancia de la adhesión del país a la reglamentación de la Organización Internacional del Trabajo (OIT). "Este es otro caso en el que si se cumpliera el Convenio 169 de la OIT, tal situación nunca hubiera tenido lugar" manifestó.

El Convenio 169 de la OIT es un acuerdo internacional firmado por Guatemala que requiere la consulta previa para explorar tierras pertenecientes a comunidades indígenas.

Skye sees prospects in Guatemalan nickel project

By Wendy Stuek, Mining Reporter

Tuesday, March 8, 2005

Toronto -- Unlike countries such as Finland, Ghana and Peru, Guatemala does not have an official presence at this year's Prospectors and Developers Association of Canada convention.

But the Central American country is drawing significant mining interest, including that of the Canadian government, which helped organize a national mining forum in Guatemala in December.

That interest is being read as a good sign by Skye Resources Inc., a Vancouver company that aims to resurrect a Guatemalan nickel project formerly run by Inco Ltd.

"We have had good support from the Canadian embassy," Skye vice-president Colin McKenzie said yesterday at the association convention in Toronto. "They have been very active on our behalf and on behalf of Canadian mining in general in the country."

At this point, Guatemala does not have a major base or precious metals mine, although both types of projects are on the horizon.

Last December, Skye acquired a 70-per-cent interest in Exploraciones y Explotaciones Mineras Izabal SA (Exmibal) from Inco Ltd. The Guatemalan government owns the remaining 30 per cent.

Exmibal operated a mine and smelter in Guatemala in the late 1970s, but by 1980 low nickel prices and high energy costs had made the project a money-loser. Inco put the project on care and maintenance.

With nickel prices at considerably higher levels and new projects in short supply, Skye wants to blow the dust off and resume operations.

Last month, the company began a study that will look at refurbishing and expanding the existing plant to produce 45 million pounds of nickel a year. Further studies will look at boosting that capacity.

Mr. McKenzie, who worked at Inco and helped cut the Skye deal before joining the junior company last year, said the plant and surroundings are in very good shape, considering they were mothballed for more than two decades.

A skeleton team of about 30 people and an annual budget of about $400,000 kept the project from falling into disrepair, he said.

Inco, which is building the Voisey's Bay project in Labrador and Goro in New Caledonia in the South Pacific, described its stake in Exmibal as a non-core asset.

Part of the challenge of bringing Exmibal on stream will involve dealing with community relations in Guatemala. Although the current government has voiced support for mining, non-governmental organizations have already raised concerns about the impact of big mining projects on the environment and local communities. Guatemala endured 30 years of civil war before a peace agreement in 1996.

Mr. McKenzie said Skye has hired a local mine manager and community workers to talk to nearby residents about the potential restart of the project. Obtaining community support for the project will be essential for it to proceed, he said.

Glamis Gold Ltd., which is developing the Marlin gold project in Guatemala, has already been the focus of anti-mining protests.

In January, villagers blocked a road that was being used to ship a piece of equipment to the Marlin site, about 150 kilometres away. The government sent police to clear the road. At least one person was killed in the resulting melee.

That led to calls for Glamis to stop developing its project, which has obtained about $45-million in financing from an arm of the World Bank.

Yesterday, Glamis vice-president Chuck Jeannes, in Toronto to attend the convention, said Glamis remains committed to its project in Guatemala and still retains significant community backing for the Marlin mine.

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