tambogrande, peru -- on any given day, the smog-choked streets of Lima, Peru's overcrowded capital city, are blocked by protests or marches. Almost nothing can surprise the demonstration-weary residents, but last month the city was startled by a new campaign. Residents of mining communities across the nation marched on the government palace demanding the right to referendums on local mining issues. The most fervent of these showdowns is between Canada's own Manhattan Minerals and the proud mango- and lime-growing town of Tambogrande -- a dust-up that has scandalized Peru's powerful business lobby to such a degree that it now charges Oxfam with being infiltrated by Maoist guerrillas.
The trouble started four years ago, when the Vancouver-based company announced it wanted to build an open-pit mine run on cyanide in the centre of town. Residents of this 20,000-strong community held protests, sent petitions to their Congress, burned effigies of Canadian miners and even danced on the streets of the nation's capital dressed as limes, all to no avail.
This year they finally hit on a referendum. Voter turnout for the June balloting was high, over 70 per cent. On voting day, hundreds of farming families lined the slippery banks of the wide, swift-moving Piura River that separates their mango and lime groves from the town, waiting to cross on water taxis -- oversized inner tubes pulled through the water by swimming "drivers."
When the final vote was tallied, 93 per cent of registered voters said no to mining.
Observer missions from York University, the Rights and Democracy Centre in Montreal and Friends of the Earth, Netherlands, gave the process their stamp of approval. In the balloting headquarters the day of the consulta, observer Stephanie Rousseau tells me, "This is a new experience, not only in Peru but in the world."
A member of Rights and Democracy, Rousseau is an old hand at spotting fraudulent elections. She participated in observer missions during Fujimori's 2000 corrupt campaign. In contrast, she classified the Tambogrande vote as "fair" and "democratic," following "standards of a national electoral process."
Roberto Obradovich, Manhattan's president in Peru, tries to justify the company's boycott of the vote by saying townsfolk were being toyed with. "In developed countries, with educated people, such models may be able to work," I heard him say at a foreign press conference in Lima's five-star Las Americas hotel. "But in our country, where the population is so easily manipulated, I believe that if more of these types of referendums follow, the state will be paralyzed."
Obradovich then said the referendum question was "confusing" because it asked four questions instead of one. He was interrupted by Dow Jones business reporter Robert Kozak, who countered that the ballot indeed contained one simple question. In a rare moment of high tension at the comfy-chaired, plush-carpeted press club, a visibly perturbed Kozak read out the question for the assembled reporters, who momentarily forgot about the plates of sandwiches and free coffee. "Are you in agreement with the development of mining activity in urban, urban-agricultural and outlying agricultural lands in the region?"
Refusing to admit his mistake, Obradovich countered that the question was "politically motivated."
The Peruvian government has been equally obstinate in refusing to recognize Tambogrande's vote. Jaime Quijandria, Peru's minister of energy and mines, has vowed that the referendum will hold "no legal weight." He told reporters the town had "mounted an excellent publicity campaign -- but it's not democratic. They should wait for the results of the environmental impact study."
Tambogrande's mayor, Alfredo Rengifo, is baffled by the central government's stance. "I cannot understand how a government trying to restore democracy can ignore the will of the people," says Rengifo, a soft-spoken man who talks more like a philosopher than a politician.
The answer is closely tied to the current government's economic recovery plan. Mining provides about 40 per cent of Peru's export revenues, and President Alejandro Toledo has granted the industry the status of a Greek god, erecting monuments, praying for higher market prices on precious metals and hoping a benevolent mining Zeus will save the country from rampant poverty.
There is a darker side to the government's favouritism toward Manhattan, says Francisco Ojeda, president of the Tambogrande Defence Front, a citizens' group opposing the mine. Ojeda, who owns a private school and can be seen motorcycling to his farm every morning at 4 am and returning to town before classes, points out that once the mine is approved, the government will own 25 per cent of it, making it both a regulator and stakeholder -- an obvious conflict.
Before the project can move forward, however, Manhattan must present its environmental impact studies to the Peruvian government for approval, a process that has been delayed for more than a year.
Although Manhattan officials insist the mine will not have any negative impact on local agriculture, an independent report written by U.S. hydrologist Robert Moran and paid for by Oxfam America, the Environmental Mining Council of British Columbia and others came up with quite different findings. According to Moran, "The proposed Tambogrande open-pit gold mine, if approved, is likely to have negative, long-term impacts on water quality and quantity, the general environment and possibly agriculture."
Messing with agriculture in Tambogrande is a serious matter. The lush, green valley around the town happens to be the country's most profitable fruit producer, providing about 40 per cent of the nation's mango and lime crop and earning about $135 million (Canadian) a year from agricultural and forestry products.
Manhattan is a much smaller enterprise. The relatively small junior company does not own a single mine in operation and has staked its future on Tambogrande. The company estimates reserves under the town could be worth $1.58 billion, and it holds concession rights for other deposits in the San Lorenzo Valley that are equally bursting with minerals.
With each side having so much to lose, tensions are running very high. Violence has erupted on several occasions, most seriously last February when the mine's compound in Tambogrande was burned to the ground by angry protestors. A month later, Manhattan's most charismatic opponent and the president of the state mango growers association, Godofredo Garcia, was assassinated in still unsolved circumstances. Now Manhattan has accused Oxfam of supporting "an aggressive misinformation campaign" by providing funding for Tambogrande's referendum.
The slander campaign has been taken up by Peru's National Mining Society, an elite trade group, and pro-mining news media. Perhaps the most bizarre attack came in the July 13 edition of Caretas, Peru's respected weekly newsmagazine. Columnist Augosto Elmore wrote, "I suspect the hand or the fingers of Sendero (Luminoso, a Maoist-aligned terrorist organization) are behind the non-government organization Oxfam that has come from England to Peru to question foreign investment in our country."
An absurd illogic underlies this charge: Sendero is famed for abhorring elections, preferring grenades and rifles to voting booths. Even more ridiculous is the suggested alliance between Maoists advocating land reform and the "bourgeois" land owners leading Tambogrande's struggle.
Luckily, our own government does not share this point of view. The Canadian ambassador in Lima, Hugues Rousseau, has met with all the players in the Tambogrande case. "We don't believe their Defence Front are the terrorists people have accused them of being," he says. "When we met the representatives, we thought they were very dedicated people working to protect their region."
At the same time, he stresses that the problems in Tambogrande are complicated and require open, serious dialogue between both sides in order to reach a solution. Although Manhattan is operating on Peruvian soil, the Canadian government does have codes of conduct for Canadian corporations working overseas. These are voluntary, however, and Manhattan is not a signatory.
Apart from Manhattan, Canadian mining corporations have earned respect within the industry in Peru as pioneers in environmental and social responsibility. One mining insider has even remarked that many Peruvian firms blame Canadian corporations for being "too green," too socially responsible and raising the industry's standards. Canada's rep, however, has been badly tarnished by the Tambogrande saga.Stephanie Boyd is a freelance journalist and documentary filmmaker based in Peru. She and her partner, Ernesto Cabellos, are currently finishing a film, Choropampa, The Price Of Gold, on a devastating mercury spill.