Complementary Strengths: Continuing the Partnership Between Peru and the EU

The European Union (EU) and Peru signed a Free Trade Agreement nearly five years ago. Trade between the South American country and the European bloc currently amounts to 6 billion euros a year, with mining products accounting for more than 36%. The EU is Peru's third-largest market and its leading provider of services and technology.

During the past five years, the EU became the main source of foreign investment, contributing 8.5 billion euros to the Peruvian economy. European officials have said that they are always seeking to improve the investment climate and address shortcomings in the labor market. Matthias Jorgensen, head of the EU Trade Unit, has stated that the relationship with Peru goes beyond trade and is ambitious on environmental issues.

In the area of raw materials, the EU and Peru's Ministry of Energy and Mines (MINEM) signed a letter of intent in January 2013, in which they agreed to engage in ongoing dialogue to promote mutual understanding, increase bilateral cooperation and share information about policies related to raw materials and mining. Framework conditions for this agreement seek to promote development, innovation, respect for the environment, growth and social inclusion.

Peru is an important producer of precious metals and base metals. Table 1 shows the Andean country's contribution to global mining production of various metals.

Innovation in mining is an essential task and is a focus of the Ministry of Energy and Mines (MINEM). Future scenarios are likely to include the need to sustain larger productive processes; these must take an integral approach because of their environmental repercussions, which affect nearby populations.

This makes it necessary to examine processes, seeking methods that are different and creative, and which contribute to cost reduction and, therefore, to an increase in productivity and efficiency.

The EU can establish areas of cooperation with Peru, with benefits for both parties, such as analysis of mine tailings for reprocessing and extracting strategic industrial elements. The economic treatment of complex polymetallic deposits that contain critical metals that are listed as critical raw materials in the EU can be done on Peruvian deposits. In the EU, processes are being developed that combine hydrometallurgy with novel metallurgical extraction techniques.

These technical studies must be supplemented with reports on regulations, global reserves, market potential and growth, to stimulate investment in these innovative business solutions.

The treatment of highly acidic water discharged from mining deposits is a key concern throughout the industry. The search for passive treatments, such as wetlands, which are used extensively in Europe, could offer opportunities for collaboration and associativity between Peruvian and European researchers.

Land-use planning is another area of concern in geologically rich countries, such as Peru. By definition, exploration is a never-ending process; for the country's mining future, it is therefore important to safeguard areas where resources have been discovered. Knowledge of the country's geology, along with economic factors and social acceptance, should be part of a multi-dimensional evaluation model for medium- and long-range planning, recognizing the need to designate specific areas for future mining operations. Europe can offer interesting experiences in this area, having developed the concept of “Mineral Deposit of Public Importance”.

Finally, Europe has much experience in the closure of mining operations, such as coal mines, which has involved establishing measures for compensating neighboring communities, experiences that could be shared with Peruvian authorities.

Although Peru ranks 70th out of 127 countries in innovation, according to a study of competitiveness prepared by the World Economic Forum, its mining industry is fairly well developed and has researchers who could form part of innovation teams in order to obtain outcomes that benefit both Peru and the EU.

María Chappuis
Advisory Board member of INGEMMET – Geological, Mining and Metallurgical Institute, Peru

Tintaya Open Pit Copper Mine – Peru

Cerro Verde Open Pit Copper Mine – Peru