Chilean president politely reminds Canadian business to follow the law

OTTAWA – The president of Chile is politely reminding Canadian business that his country is a democracy governed by laws that will be enforced, a week after a massive Canadian gold mining project was suspended and fined for multiple environmental violations.

Sebastian Pinera was on Parliament Hill for a visit Thursday with Prime Minister Stephen Harper at which officials from Canada and Chile signed a number of bilateral trade and investment agreements.

Among those agreements was a renewed strategic partnership framework that included “a strong commitment to responsible resource development” and the exchange of expertise, “including research and development to reduce the environmental footprint of mining.”

Exporting Canadian know-how in “extractive industries” has become part of the Harper government’s foreign policy plan.

The new focus was unveiled by the Conservatives last year, designed to put foreign aid spending more in line with the country’s commercial interests while emphasizing the sharing of Canadian labour and environmental standards.

However, Canadian mining operations abroad continue to attract local opposition, particularly over environmental concerns.

Last Friday, the Chilean government fined Barrick Gold $16.4 million for breaching its environmental commitments, and ordered the suspension of the $5-billion open-pit Pascua Lama project in the Andes Mountains.

And on Thursday, while Harper was meeting his Chilean counterpart, a Greek delegation was elsewhere on Parliament Hill seeking help to stop Vancouver-based Eldorado Gold Corp.’s mining operations in northern Greece.

Pinera was asked about the economic impact of the Barrick suspension during a media availability with Harper.

The Chilean president, who holds a PhD in economics from Harvard, noted the importance of Canada as one of his country’s top three foreign investors.

“I would like to start these remarks by saying that Canadians’ investment are welcome in Chile,” said Pinera. “And in Chile we have a democratic system and the rule of law.”

He pointed out that Barrick was given conditional approvals in 2001 and 2006, but that the government had identified 23 environmental infractions the company has agreed to address.

“I hope that if they comply with all the conditions — that were set from the beginning when this investment was approved — that the investment will be able to continue,” said Pinera.

“So, basically, all the Canadian investment can be certain that in Chile we have the democratic system and the rule of law is the rule that will decide and will make the decision with respect to this investment.”

Harper, standing next to Pinera, did not address the issue of Barrick’s environmental problems in Chile.

In prepared remarks before the question-and-answer session, the prime minister noted that Canada has become Chile’s largest source of new direct investment in the past decade.

And Harper lauded the two countries’ “commitment to shared objectives for the hemisphere: democracy, security and, of course, the long-term prosperity of our peoples.”

Some Chilean civil society groups are not convinced.

On the weekend, a coalition of 11 groups spoke out against what they consider an insufficient penalty for Barrick Gold’s environmental transgression.

In a release, they noted the government decree states that the project title holder “has deliberately failed to comply with a large number of commitments which, it is worth recalling, it took upon itself in order to benefit from the favourable approval of this project.”

The Chilean coalition stated that the fine levied was “insignificant when measured up against the irreparable damages produced in our headwaters.”

Jamie Kneen, a spokesman for the advocacy group MiningWatch Canada, said this country should be a global standard-bearer given the long expertise and number of mining schools.

“Canada should be a leader, not a laggard in corporate behaviour. Canadian companies should be the best, and not average or worse than anyone else,” Kneen said in an interview.

A spokesman for International Trade Minister Ed Fast insisted Canada is a global mining leader.

Rudy Husny cited the government’s creation of a federal corporate social responsibility counsellor and an arms-length Centre of Excellence in Corporate Social Responsibility.

“We’ve also provided (the Canadian International Development Agency) assistance to help our partners develop their capacity to manage natural resource development in a sustainable and responsible manner,” Husny said in an email.

Among the other bilateral agreements signed Thursday, Chile opened its market to Canadian beef while Canada added Chile to its list of designated countries of origin, a tool used to streamline refugee and visa applications.

Harper also announced that Canada will back Chile’s effort to win a seat on the United Nations Security Council for 2014-15.