Mulino says Panama will not be Intimidated by Copper Mine Arbitrations
Aerial view of Cobre Panama mine in Donoso, province of Colon, 120 km west of Panama City, on December 06, 2022. - The foreign-owned open-pit copper mine --the largest in Central America and which accounts for 75% of Panama's exports, risks closure if it does not renegotiate a new contract with the government to continue operating. (Photo by Luis ACOSTA / AFP) (Photo by LUIS ACOSTA/AFP via Getty Images)
Panama will not be intimidated by the arbitration proceedings that various companies have against the country for the suspension of operations at the First Quantum Minerals copper mine in Donoso, Colón province, as indicated by the President of the Republic, José Raúl Mulino, on July 18, during his first weekly meeting with the media.
“In order for me to sit down with government representatives with the companies that filed arbitrations against our country, those processes must be suspended. Panama is not going to sit down with a gun to its head to resolve the problem,” he said. Mulino’s comments come after it was announced on July 17 that the Franco-Nevada company filed a $5 billion lawsuit against Panama for the closure of the mine, which is added to the other $57 billion in arbitrations against Panama, which are being carried out by other suppliers and investors.
“The Panamanian State has many huge lawsuits from many companies for the closure of this mine, but our duty is to defend ourselves. We cannot do anything about these lawsuits,” he said, while considering that the lawsuits are “justified” since it is a very large investment that was suddenly halted. “We had the duty of closing a mine that represented 5% of the Gross Domestic Product (GDP) and a huge amount of money, which comes from all over the world. And it is normal that there are reactions and they are just beginning,” acknowledged the leader, who assured that this issue will be a priority on his agenda next year.
The governor said that since the Supreme Court of Justice declared the contract that regulated this mining activity unconstitutional, the new government cannot try to reactivate that document, which was described by Mulino as “atrocious.” The president ruled out holding formal meetings with the companies and suppliers involved in the near future, but acknowledged that there are representatives who have been meeting with the ministers. “We are the owners of that mine and things will be done as we dictate,” he added.
The president announced that they are carrying out an environmental audit of the mine, with the best international experts so that the country knows the truth about the state of the site, its surroundings, rivers, fauna and flora, and the possible dangers that its current situation represents to the environment, whether it is open or closed. “Panama will choose the auditing company, which will not cost the State anything. The plan to open and close in a definitive, safe and positive way for our country will depend on the result of this environmental study,” said Mulino.
