Bolivia nationalizes private mine creating tensions for foreign investors

By Park Sae-jin Posted : June 25, 2012, 12:40 Updated : June 25, 2012, 12:40
Mining giant Glencore has protested strongly at the nationalisation of an operation in Bolivia. Glencore said Bolivia‘s move raised serious questions about future foreign investment in the mining sector.

The government of Evo Morales took over operations at the Colquiri mine on Wednesday after weeks of violent protests over management of the mine.

“Glencore strongly protests against the action taken by the government of Bolivia,” the commodities giant said. The company added that it “reserves its rights to seek fair compensation pursuant to all available domestic and international remedies”.

Since 2005, the mine has been operated by a Glencore subsidiary, Sinchi Wayra. Glencore said in its statement that Colquiri has paid royalties, taxes and fees to the Bolivian state of more than $70 million.

The Morales government has already nationalized natural gas and electricity assets.

The mine is reportedly a very small part of Glencore’s global operations. However, the company highlighted the impact of the move on future investment in the country. “The action taken by the government of Bolivia will pose a number of serious questions relating to the government‘s future policy towards foreign investment in the mining sector,” Glencore said.

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