Regulatory uncertainty mars Colombian mining outlook

Abstract

Subject The outlook for the mining sector. Significance Mining firms operating in Colombia have expressed increasing concern over the lack of clarity in legislation governing extractive activity in the country. Difficulties in navigating the complex regulatory environment, and the unclear direction of future reform, have served to increase risks for those planning substantial investments in mining projects. Coupled with lower global commodity prices, the confused state of legislation is encouraging extractive firms to delay or scale back their investments. Impacts Poor performance of the mining sector is likely to have negative implications for overall economic growth. The reduction in exploration activity could jeopardise mining performance for several years, by reducing the pipeline of new projects. Reduced formal exploitation increases the risk of invasions by environmentally unsound informal and illegal mining operations.