Liberty and order Colombia’s tortuous road back to normalcy

Colombia. The name stirs up fearful images of car bombs, cocaine cartels, kidnappings, dirty money and endless guerrilla war in the jungle.

Those are real fears, but there is reason to believe the situation is improving: this country of 45 million inhabitants, Latin America’s third most-populous nation, is two-and-a-half years into a remarkable recovery that’s being spearheaded by its hardline president, Alvaro Uribe.

Uribe is a tireless micro-manager who has survived more than a dozen assassination attempts, besting his father, who was murdered by the country’s drug lords. He began his first four-year term in August 2002, and will likely be re-elected next year to serve a second and final term once a pre-existing one-term limit is completely removed.

Upon taking power, Uribe first aimed to root out corruption in the upper levels of government, and then promoted responsible government at the regional and local levels.

Uribe’s next most important step was to reverse his predecessor’s perhaps good-intentioned but ultimately unwise appeasement policies toward the country’s “narco-guerrillas,” the Revolutionary Armed Forces of Colombia (FARC) and the National Liberation Army (ELN). He pushed through significant tax hikes in order to boost the number of security personnel from 80,000 to more than 360,000, and his government continued to accept significant military aid from the U.S., which allowed for the creation of a far more mobile and high-tech armed forces.

Critically, Uribe helped reform Colombia’s armed forces by making them a professional, rather than conscript, outfit and by partnering them with villagers to form local militias in the previously neglected countryside.

While progress is admittedly uneven, the general trend is encouraging: employment and gross-domestic-product levels are up; the number of “left-wing” guerrillas and “right-wing” (and sometimes drug-trafficking) paramilitary members is being reduced, either from capture, death or demobilization; land under coca cultivation has been almost halved (but is probably being replaced by crops in other countries); deadly guerrilla raids on isolated police and army outposts have been slashed 97 per cent; attacks on infrastructure such as oil pipelines are way down; kidnappings, terrorist bombings and street crime are dramatically reduced; and Colombians can now regularly travel by road between cities, instead of exclusively by air.

While the national budget has been warped and sent into deficit by such heavy military spending, Colombians who fled the country are returning to live and invest, and foreign investors have come back, too, particularly from the U.S., in the oil and coal sectors, and Europe, in agriculture. Private investment totalled 12 per cent of GDP last year, up from 6 per cent in 2000.

Uribe’s popularity has soared as a result of his decisive moves, with his approval ratings consistently in the mid 70 per cent range, up from his election tally of 54 per cent of the vote.

While Colombia’s decades-old civil war is by no means over, particularly in the jungle-covered southeastern departments of Meta, Caqueta and Guaviare, Uribe’s reforms have had such a profound impact on his country that it’s now likely that whoever next takes the reins of power will continue his successful policies.

If the Nobel Peace Prize hadn’t, in the past four years, been turned into another propaganda tool to advance global socialism, the right-wing Uribe would certainly have his by now. (Last year’s Nobel Peace Prize winner was a female environmentalist and tree planter in already-peaceful Kenya. Funny how all those trees in Colombia didn’t stop a civil war.)

Colombia has a rich mineral endowment, a free-market orientation, and an educated and hard-working population, so its return to normalcy has significant implications for the mining industry.

First off, it must be noted that Colombia is unusual in Latin America in that mining is carried out entirely by private industry, including many small family-owned mines that produce gold and top-quality emeralds.

Colombia has the largest coal reserves in Latin America and is home to the largest open-pit coal mine in the world: the twenty-two-million-ton-per year El Cerrajon, owned by BHP Billiton, Anglo American and Glencore International. Almost as big is the eighteen-million-ton-per-year Loma coal mine, owned by privately held Drummond of Jaspar, Ala. With these big mines, coal has even moved up to second place among Colombia’s top export earners, behind oil and ahead of coffee, for the first time.

BHP Billiton is also active in northern Colombia at its Cerro Matoso open-pit ferronickel plant, which has a fifty-five-thousand-tonne-per-year capacity.

With beefed-up military and private security, these three large, foreign-owned mines were able to continue operating even during the worst moments of the civil war. Still, guerrillas would periodically sabotage the rail lines serving the mines and then, oftentimes, lean on the repair crews for “protection” money.

On the other hand, with its necessarily lax security, mineral exploration activity in Colombia took a massive hit as civil war raged at the start of the millennium and cut off large areas of the country from civil society.

Even at the leading exploration play in the country, Greystar Resources’ multi-million-ounce Angostura epithermal gold project, in the northeast, guerrillas took control of the deposit and nearby towns for a couple of years. They also extorted the locals and laid down land mines.

Today, Greystar is back in full force on the property, with 250 mostly Colombian employees and contractors, 10 drill rigs, and top-level security arrangements.

Encouragingly, Greystar has recently even been able to carry out regional, grassroots exploration with great success.

Of course, grassroots work in Colombia is not for the faint of heart: before you even set foot on your prospect, your first step is to meet with the local government and military, and maybe call in a mine-clearance crew!