Chinese Mining Companies in Peru: Is There a Single Cause of Problems?

Abstract

China’s dependence on the supply of mineral resources is becoming stronger than ever. The activity of Chinese investors in the mining industry on a global scale has increased significantly during the last years. Moreover, the activity of Chinese mining investors in the developing countries has some special characteristics such as large-scale projects and protests of local communities during their implementation. This article discusses the activities of Chinese mining companies in Peru, in which both of these conditions were present. The author analyzes the activities of “Shougang”, “Chinalco” and “MMG Ltd” in Peru. The hypothesis is as follows. If there is a special Chinese way of investing, the problems of listed investors (which lead to conflict with local communities) should have a single reason that is unique for all Chinese enterprises. In these conditions, investors should keep the distance between themselves and Peruvian authorities and the local citizens. As a result of the study, the conclusion is made that such reason cannot be identified at this stage. The causes of problems for each of the considered enterprises are unique, but not common for all of them. The origins of these problems are the economic situation, the bureaucratic problems of the Peruvian authorities, as well as the general trends in the relations between transnational mining companies and the Peruvians. At the same time, Chinese companies try to take into account the experience of their predecessors. Most likely, in the future that could possibly lead to greater openness and expansion of dialogue between investors, government and the public worldwide.