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President Evo Morales pushed forward legislation to give the mining sector the dignity it lacked since the Spanish Colonization.
Since the Spanish colonization of America, Bolivia has been a mining country. This sector represents the second source of income, behind hydrocarbons. From 2006 to 2012, the mining industry contributed to the Bolivian economy with an average of US$201 million in taxes, according to official reports. The amount represented an increase of over 1,156 percent in regards to the period 1999-2005.
Mining also contributed US$4.8 billion to the Gross Domestic Product by 2011. The export of mining products contributed to the Bolivian economy with over US$11.2 billion between 2006 and 2011.
The Mining activity has always been a crucial source of income in Bolivia, although it had been marginalized for over 190 years. It was not until Evo Morales came to power that the sector was taken into consideration, becoming highly regarded due to the recently approved Mining and Metallurgy Law.
The law, which was the result of an important citizen consensus, replaced the pre-existent privatized norm that was tailored to privilege international investment.
The new law also gives the government constitutional authority over the management, administration and control of mineral resources in favor of the Bolivian people’s interest.
The majority of the country’s mineral resources are located in the western departments of Potosi, La Paz and Oruro, where various minerals are produced, such as tin, copper, zinc, antimony and silver. Bolivia is the fourth producer of tin and the eleventh producer of silver in the world.
Karachipampa Complex
The metal-producing complex in Karachipampa, located in the department of Potosi, was inaugurated in 1984, after which it faced many obstacles preventing it from actually producing. The government of Morales recovered control of the facility in 2011.
In January of 2013, the Bolivian president signed a decree to rehabilitate the metallurgy plant and re-initiate operations in June. By August, the plant had produced over 60 tons of lead with a level of purity of 99.98 percent.
The complex, which was re-inaugurated September 10, will produce an estimated 51 ,000 tons of gold, zinc, tin, antimony, bismuth and cadmium annually.
Future plans
In order to achieve further industrialization of the sector, the Bolivian government is planning to create the Mining, Metallurgy Institute in Potosi with the participation of the Tomas Frias University, according to Mining Minister Cesar Navarro.
“This is the next step we will take toward the modification of the productive sector of the country,” Navarro said. He highlighted that the need of institutions to train miners was determined to be one of the main obstacles blocking the development of this industrial sector.
As an example, the minister said that “in order to operate the Oxygen Plant of Karachipampa, six Bolivian technicians were sent to China for training.”
Investment
The Central Bank of Bolivia last month reported that the gross Direct Foreign Investment (DFI) in Bolvia totaled US$2.3 billion, a 34.9 percent increase from 2013.
Bolivia allocated US$151 million from the DFI to mining, while almost US$1.4 billion were channeled to the hydrocarbon sector and US$113 million to commerce, electricity and others.
In the last 10 years, Bolivian mining has been launched to a whole new scenario. It is adapting to the surge of metals that are presently more sought after than tin.
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