A New Look At Lower Andean Mining - Chile, Bolivia And Peru Plan Mineral Future With Bold Legislation

As political tensions in African and Asian mineral producing regions increase, the orientation of Latin America's economic development assumes importance not only in the U.S. hemispheric policy but also in our mineral-based economy. Latin America as a mineral supply source has been confronted with regional, political and economic problems which may, at best, have limited further investment and, at worst, have suggested possible repudiation of existing investments. Historically, the mining industry has provided a basis for the national economies of Bolivia, Chile and Peru, and recently the governments of these countries have sought to force increased development of the industry through new and somewhat revolutionary mineral legislation. The extent to which the mineral industries are intended to finance economic development is uncertain and the influence of this legislation on economic freedom and incentive for foreign and domestic investment is a matter for some thought. Two facts are outstanding: first, mining, at present, provides approximately 80% of the foreign exchange in Chile and Bolivia and 42% of that in Peru and, second, existing tax revenues are insufficient to finance a developing economy.