Dec
Defending Natural Resources, Protecting Sovereignty
Pacific Rim Threatens to Sue Under CAFTA: December 2008
By Sebastian Dario
Last week the Canadian company Pacific Rim Mining Corp escalated their tactics for putting pressure on the Salvadoran government to administer exploitation permits for open-pit cyanide gold mining in El Salvador by filing a Notice of Intent (NOI) against the Salvadoran government under the Central American-Dominican Republic-United States Free Trade Agreement (DR-CAFTA). The NOI was filed on December 9th, 2008. According to Pacific Rim, they have developed assets of over $77 million in El Salvador by exploring, discovering, and delineating gold deposits. Also according to the company, the Salvadoran government has breached international and Salvadoran law by not issuing exploitation permits, which, Pacific Rim says, “has resulted in loss to the Company, its employees, and the local communities.”
By filing a Notice of Intent, Pacific Rim is not actually filing arbitration against the Salvadoran government in the CAFTA tribunals. According to CAFTA procedure, before an actual suit and be filed, there is a 90 day period where a company files the NOI, supposedly with the hopes that an acceptable agreement can be reached between the company and the government before the proceedings go to trial. By filing the NOI on December 9th, Pacific Rim has timed the expiration of the 90 days mandated in the NOI to land just six days before the Salvadoran Presidential elections, which are scheduled for March 15th.
Pacific Rim is working hard to convince its stockholders that El Salvador is ripe for mining and that the Salvadoran people want mining in their country. In a conference call held on December 9th, between the Pacific Rim CEO Tom Shrake, their legal representation Timothy McCrum of Crowell & Moring, and various stock holders in the company, Tom Shrake said that majority of Salvadorans support mining and that:
“The idea that this type of mining is catastrophic to the environment is pure fiction invented by politically-minded international NGO’s who hide behind environmental protection in their anti-development activities. These organizations want to deny the extremely poor people of Cabañas the economic prosperity these same NGO’s enjoy themselves. They want to scare the good people of El Salvador into believing that gold mining will destroy the environment for ages. That’s simply preposterous.”
When asked later what the major objective of organizations promoting mining resistance was Shrake responded, “I mean that question, that fundamental question is one that has gnawed at me for the entire time I’ve spent my career in the mining business. What is it that they hope to achieve? I mean do we go back to hunters and gatherers. I mean do we want no metal? Do we want no oil? I just, I don’t understand it.”
However, the organizations and communities involved in the anti-mining struggle in El Salvador are clear: mining would have dire environmental and social impacts on communities. In a public statement made on June 5th, 2008 by the Association of Communities for the Development of El Salvador (CCR), nine mayors from Chalatenango, CORDES, Caritas, and PROVIDA, the signatories stated: “Human life does not have a price. We can live without gold but not without water.”
The National Table against Mineral Mining, where both CRIPDES and the CCR have representation along with other social movement organizations and NGOs concerned about mining, issued a statement saying “We reject Pacific Rim’s claims. Giving over [exploitation] permission would be a death sentence from the country and the arbitration can’t be accepted because it is the mining company that should be sued.” They call the suit blackmail and cite the social conflicts incited by mining companies in Cabañas, the drying up of water sources, the invasion of private property, and the corruption of public officials as grounds for a case against Pacific Rim.
Organized communities and the social movement aren’t the only ones expressing their concern about mining and the Pacific Rim NOI. In an interview with the Diario CoLatino on December 15th, the Archbishop of San Salvador, Fernando Sáenz Lacalle, said “We hope that no Free Trade Agreement will oblige a country to harm its environment or damage the health of its citizens to facilitate big earnings of a multinational [corporation], that takes 97% percent of the juicy earnings and leaves us100% of the cyanide.”
It is obvious, that by filing the NOI, Pacific Rim is using fear tactics try to force exploitation concessions. There are serious doubts as to whether or not Pacific Rim actually intends to continue with arbitration after the 90 day NOI period expires, due to weakness in their case, lack of applicability of CAFTA, and a lack of precedent. However, whether or not they intend to take it all they way to arbitration, they are fully expected to try to manipulate the case as much as possible to create fear in the Salvadoran population and put pressure on the government.
