International Mining’s July issue includes a feature on Peru – issues for its mining industry and examination of some of the major projects. As we go to press, MinerAndina (www.minerandina.com) reports that the Ministry of Energy and Mines (MEM), as well as the Ministry of Production, are currently working on legislation that will promote metallurgical development, the main elements of which would be the metals locally produced, MinerAndina was told by Juan Valdivia, Arch., the Minister of Energy and Mines.
The legislation would be similar to the draft bill submitted to Congress for the promotion of the petro-chemical industry. "Simultaneously, we have been working with the companies in solving financial and administrative issues, so that these investments will be made", noted the Minister. Thus, MEM is taking action to encourage adding value to the country’s natural resources, as government policy. "We must not limit ourselves to exporting raw material. Finished products provide more employment and added value to the resources. In the case of mining, we must develop the metallurgical industry", he stated.
The proposed tax benefits are the same benefits contained in the draft bill to promote the development of the gas industry in Peru, basically legal stability agreements, prompt VAT rebates and accelerated depreciation. The best known metallurgical companies in Peru are Aceros Arequipa and Siderperú.
In addition, the Minister remarked that MEM will also deal with regulation of the market for domestic purchases and sales of metals, to protect the development of Peruvian industry. Valdivia is of the opinion that there is still a need to improve and enhance the current legislation, not only administrative norms, but also environmental laws, as the country must be more demanding about compliance. "Freedom in the country does not mean that investors can do whatever they feel like; we have to make sure that there is compliance, to secure responsible investments and sustainable development".
Although he stated that there are no changes being made to the laws, he mentioned that they are working and collaborating with other institutions. He cited, as an example, the maximum permissible limits, which is a task performed by Consejo Nacional del Ambiente (National Environmental Council) – CONAM, but the MEM has to have its input. Nevertheless, he reminded all that water and air quality standards are yet to be established. For the time being, Peru has adopted the World Bank’s international standards; and no due dates have been set for the local specification of these standards.