Peru’s Illegal Mining Metastasizes into Social and Political Problem

Peru’s Illegal Mining Metastasizes into Social and Political Problem

Last month, police in Peru destroyed $20 million worth of mining equipment as part of a wider crackdown on illegal mining in the country. In an email interview, Miguel Santillana, an expert on the mining industry at Instituto del Peru, discussed the Peruvian government’s response to illegal mining.

WPR: What is the relative importance of the mining sector in Peru's economy, and what has been the scale of damage to the sector caused by illegal mining?

Miguel Santillana: The extractive industry accounted for 11 percent of Peru’s GDP in 2011, up from 5 percent in 2006, according to the IMF, meaning the proportion of Peru’s GDP that came from mining more than doubled in five years even while the economy grew. Most foreign investment in Peru is dedicated to the extractive industry, given international commodities prices and Peru’s well-known natural resources.

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