Caribbean & Central America - March 2012 (ISSN 1741-4458)

First mining, now hydroelectric projects? Less than a year since indigenous-led popular pressure forced President Ricardo Martinelli to repeal a reform to the 1963 mining law, which would have opened the sector up to foreign government investment [RC-11-03], his decision to revisit the issue is threatening a new political defeat for his pro-business  government. The submission of a Martinelli-backed bill to congress, which apparently ignored the reversal, once again brought indigenous groups (whose territory contains valuable natural resources) back onto the streets. It not only forced fresh reassurances from Martinelli regarding mining but, with his popularity again in free-fall, yielded new government concessions vis-à-vis another key indigenous demand, the suspension of hydroelectric projects.

In late January protesters from the Ngäbe Buglé comarca (an indigenous political administrative region) began blockading roads after the legislature began debating a bill (415), which omitted an article (5) addressing the protection of minerals, water and other natural resources in the comarca. Article 5 had been agreed as part of a 27 February 2011 deal between the government and indigenous groups, ending unrest triggered by the proposed change to the mining code – the repeal of which signified one of Martinelli’s two major policy reversals since taking office in July 2009 after his failed attempt at weakening labour and environmental legislation (the so-called ‘Ley Chorizo’) in July 2010. Indigenous concerns are based on the fact that Cerro Colorado, believed to hold the biggest copper reserves (25bn pounds, worth US$75bn) in the country, lies within the comarca, which spans some 8% of national territory.

Protests rapidly spread around the country, once again illustrating traditional popular opposition to efforts to develop the mining sector (raising questions as to Martinelli’s decision to back-track). After clashes between indigenous groups and police turned violent, with at least two protesters killed, attracting concern from international institutions such as the UN, the two sides struck a deal on 7 February. Among other provisions, the eight-point accord called for bill 415 to be resubmitted to congress in exchange for the protests being called off.  

While Martinelli reiterated his commitment not to touch the country’s mining legislation, his refusal to address the other main indigenous complaint – the construction of hydroelectric power stations in the comarca – on the grounds that it was not part of the original February 2011 deal, led the same groups to resume protests. This, together with Martinelli’s plummeting popularity (see sidebar), forced the government back to the negotiating table. With the final agreement is yet to be signed, preliminary talks have already yielded the pledge that the development of hydropower in the Ngäbe Buglé territory is to be ultimately determined by those living in the comarca via referenda; the parties have also agreed on the suspension  of construction work on the Barro Blanco dam on the Tabasará river, in the Chiriquí province (one of the three provinces comprising the Ngäbe Buglé comarca, along with Veraguas and the Bocas del Toro) until a technical analysis has been carried out. The construction of the dam, which began in 2011 and is expected to generate 28.8MW, was a core complaint of the Ngäbe Buglé protesters, who say that they were not consulted properly and that the dam would displace thousands of local inhabitants.

With hydroelectric energy accounting for 47% of Panama’s total 1974MW installed capacity and 58% of the total 7248.5GWh in net generation in 2010, the country’s hydroelectricity capacity nearly doubled between 1990 (when it was 550.8MW) and 2010. This “boom” took off under the previous Martín Torrijos administration (2004-2009), after he eased the procedures for granting concessions. According to the national public services authority (ANSP), of the 37 authorised concessions currently under design or construction, all but two are in Chiriquí (26), Veraguas (7) and the Bocas del Toro (2) while all of the further 44 concessions being processed are in the same three provinces (30 in Chiriquí, 13 in Veraguas and one in  Bocas del Toro).

• Popularity at all-time low

According to the latest poll by Dichter & Neira, published last month, President Ricardo Martinelli’s approval rating is at 33.3%, his lowest since taking office in July 2009 and a drop of 40 percentage points over the past year. Of the 1,200 people interviewed by the survey, 80.3% disapproved of the government’s handling of the recent dispute over the mining law, while 71.8% considered that there had been an “unjustified use of force” to dispel protesters. Worryingly for Martinelli, the (now opposition) Partido Panameñista (PP) of Vice-President Juan Carlos Varela tops the list of voter preferences with 17.3%, followed by the Partido Revolucionario Democrático (12%); Martinelli’s Cambio Democrático is trailing on 3.1%.