LATIN AMERICA — Mexico acts to encourage private mining

The Mexican mining industry has been forced to undergo a restructuring the likes of which it has never experienced, according to the Mexican Investment Board.

The reorganization has been triggered by several factors: a sluggish world economy; more orientation toward services and computerization within industrialized nations; pressure to recycle and adopt new materials; and tight international competition.

The government has responded by attempting to spur private investment in exploration and development while, at the same time, regulating the use of natural resources.

More than 11 million hectares of idle and unused ground, previously assigned to state-owned enterprises, have been made available to investors. Also, 60 government requirements for mining operations have been ditched, allowing for a more streamlined regulatory framework.

As evidence that the industry has benefited from the restructuring, the Mexican Investment Board cites the creation of 14,000 mining franchise and assignment titles covering 6 million hectares. It also points to the 60 new mining companies that have been incorporated and the US$1.215 billion that has been invested during the past three years.

The enormous interest of foreign companies in Mexico was evident at a recent convention of mining engineers, metallurgists and geologists, held in Acapulco. In attendance were more than 3,000 delegates from Mexico and 27 foreign countries.

Carlos Perez Garcia, Mexico’s deputy secretary of mines and basic industry, said the formation of a North American market (by the creation of the North American Free Trade Agreement) will open up tremendous possibilities for the country. He pointed to Mexico’s large geological resources, its centuries-old mining tradition, and its experienced workforce.

— From the Mexican Investment Board, Mexico City.