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El Salvador and Gold Mining: International Resistance to Transnational Attacks

By: 
Lisa Fuller
Date Published: 
June 1, 2010

Transnational corporations have a new tool for appropriating resources, the latest in the long and sordid history of colonial resource theft from the Global South. According to a recent report by the Institute for Policy Studies, multinationals are increasingly turning to international tribunals when denied access to a country's natural resources. And this new weapon is aimed squarely at Latin America.

More than half of the lawsuits filed in the International Center for the Settlement of Investment Disputes (ICSID), the largest of the tribunals, are against Latin American countries, which make up only nine percent of the tribunal's members. These lawsuits include those filed under the US-Central American Free Trade Agreement (CAFTA) and the North American Free Trade Agreement (NAFTA).

Latin America currently bears the weight of over two-thirds of all the extractive industry lawsuits in the ICSID concerning oil, gas, and mining.

The logic is simple: progressive Latin American governments are less inclined to allow multinationals access to national resources than their right-wing predecessors, so corporations turn to closed-door tribunals to exact payment for losing the “right” to plunder. These lawsuits also drain funds from progressive governments for vital social programs—such as health care and housing—that address the rampant poverty produced by centuries of imperialism. It is a process created by international free trade agreements, written by corporate lawyers and imposed by today's “developed” nations.

El Salvador's battle against gold mining fits this trend to a tee. For four years grassroots resistance has successfully prevented North American corporations from mining gold. Last year, the companies retaliated with CAFTA lawsuits for hundreds of millions of dollars against El Salvador's newly-elected progressive government. In response, the anti-mining movement has expanded its strategy to encompass national and international campaigns to fight the companies, the lawsuits, and the free trade model. El Salvador's struggle against gold mining is an inspiring example of how to confront the latest transnational strategy and proof that the solution to globalized corporate attacks on resources is globalized resistance.

Struggle and victory in Cabañas

Back in 2005 residents of the rural department of Cabañas started noticing “los chelitos haciendo hoyas” (white people digging holes) around their farms and grazing lands. Research by community-based grassroots organizations such as Santa Marta Association for Economic and Social Development (ADES, in Spanish) revealed that Vancouver-based Pacific Rim Mining was drilling in the Salvadoran “gold belt,” attempting to locate the millions of ounces of gold buried beneath the fertile lands of rural northern El Salvador, worth about $1,000 per ounce. Pacific Rim had procured exploration permits for a number of mine sites clustered around El Salvador’s principal water source, the Lempa River, although its exploration efforts were trained on two flagship sites in Cabañas: El Dorado in San Isidro and Santa Rita in Trinidad.

Local groups including ADES, the Environmental Committee of Cabañas (CAC, in Spanish) and the Friends of San Isidro Cabañas (ASIC, in Spanish), which had previously united to fight the construction of a landfill, turned their attention to gold mining. One of the first jointly-organized activities was a visit to the San Martín gold mine in Valle de Siria, Honduras, owned by Canadian firm Gold Corp. While there, Cabañas campesinos and community organizers came to understand the significance of a local gold mine. The environmental and health impacts were appalling: high levels of heavy metals in blood and an infant mortality rate 12 times the national average; residents covered in lesions and rashes; highly contaminated water and severe water shortages. Communication with other Latin American mining resistance movements revealed the same story: mines bring pollution, dry wells, sickness, failed crops, and deep social conflict.

For the next four years a rich diversity of Cabañas’ volunteer-based organizations plunged into community education and mobilization strategies to counteract Pacific Rim’s highly active disinformation and buy-off campaign. As mining promoters, including pocketed local authorities such as San Isidro's Mayor José Bautista, spouted lies about environmentally-safe “green mining,” community groups struck back with an effective blend of popular education and community-building activities that proved to be a powerful engine for local action. The local movement organized workshops, educational videos, presentations, discussions, forums, and vigils. The first forum held in Cabañas in October of 2005 was aptly named “Mining: Opportunity or Threat?” and drew over 500 residents. During a public debate with a company representative, attendees listened to environmental expert Dr. Robert Moran denounce the Pacific Rim Environmental Impact Assessment (over 1,000 pages long and entirely in English) as unacceptable to any developed nation.

Youth organizing has been central to the community resistance to mining. Youth groups organized concerts like “Rock por tu conciencia social” (Rock for your social consciousness), educating crowds of local youth from surrounding rural and urban areas on the impacts of gold mining through a festival-like atmosphere. Community groups partnered with youth to create three murals within San Isidro (population 2,000), proudly showcasing the community’s preference for healthy residents and protected lands over gold mines.

Toward the end of 2005 the National Roundtable against Metallic Mining in El Salvador (“The Mesa”) was formalized as a broad-based national coalition of community organizing groups, alternative media, legal advocacy groups, and sustainable development NGOs. The coalition partnership with the Cabañas-based movement has been quite strategic. While the grassroots and community organizations of Cabañas organize on the ground, the Mesa has charted national and international legal strategies to thwart Pacific Rim and provided much-needed resources: developed reports, organized materials, drummed-up publicity and media coverage on the mining struggle. Mesa organizations filed a lawsuit in the Latin American Water Tribunal against Pacific Rim and authored legislation to ban metallic mining in El Salvador, which, if enacted, would be the first law of its kind in the world.

The combined efforts of the Mesa and the local groups incited powerful community action, leading to two significant victories over Pacific Rim: government rejection of Pacific Rim's petition to extract gold and the company's complete expulsion from the town of Trinidad. Pacific Rim petitioned El Salvador's Ministry of the Environment and Natural Resources (MARN, in Spanish) for the exploitation permits to extract gold twice in 2005 and 2006. Both times the right-wing ministry rejected Pacific Rim's Environmental Impact Statement as problematic and ignored the company’s requests for permits.

Later that same year, Trinidad residents ran Pacific Rim and all their machinery off the nearby Santa Rita mine by peaceful direct action. In the midst of Trinidad's physical blockades to Santa Rita, the local and national anti-mining movement came together for a huge public display of resistance in the first “Green March” in Cabañas. Ten thousand local residents and movement activists came out in force. Trinidad's residents had to kick Pacific Rim out four times before the company finally abandoned its mine. Today Santa Rita remains shut.

The Golden Swindle

Cabañas had won the battle but not the war. Once it became clear that the Salvadoran government wasn't responding as expected, Pacific Rim needed a Plan B. Canadian, and therefore lacking a trade agreement with Central America, Pacific Rim bought into one. After a year-long impasse on extraction permits with the Salvadoran government, the company purchased Pac Rim Cayman LLC in Reno, Nevada in December of 2007. This was their key to CAFTA, or more precisely, access to that great defender of corporate interests, CAFTA's Chapter 10 on investor-state relations that grants corporations the right to sue nations for profits lost through the implementation of national laws and regulations.

In December 2008, the company filed its intent to sue El Salvador for at least $77 million. Looking to the re-election of the Salvadoran right in the then-upcoming 2009 presidential race, Pacific Rim expected to acquire permits soon. When the plan was foiled by the election of El Salvador's first left president ever, Mauricio Funes, who was unresponsive to mining interests, the company began ICSID proceedings against El Salvador. US-based mining company Commerce Group, also in the same position, filed a $100 million dollar lawsuit two months after Pacific Rim.

Without a doubt, these companies are ultimately vying for El Salvador's gold, not the lawsuit money. The projected revenue from Pacific Rim's El Dorado site alone is $3.15 billion, making the $77 million pittance by comparison. This is a last-ditch effort to strong-arm El Salvador into giving up the permits. El Salvador's recourse is to spend millions of State dollars fighting the suit, a multi-year process that that could end in favor of the corporation. Today there are 29 mining concessions in El Salvador, the legacy of past right-wing administrations, all owned by Canadian, US, or Australian firms. Those companies are patiently waiting to see what happens next. If Pacific Rim wins this case, the first CAFTA lawsuit in El Salvador, then the door swings wide open for those mining companies to sue for each of the 29 sites, given the government's public rejection of mining. This is not just a threat for El Salvador but one for any country that stands up to multinational corporations in defense of its people and national resources.

There is also a Plan C for the company: violence. Three prominent Cabañas anti-mining leaders: Marcelo Rivera, Ramiro Rivera (no relation), and Dora Alicia Sorto Recinos, have been assassinated since Pacific Rim initiated its lawsuit last year. Death threats, attempted kidnappings and murders have become an inescapable reality for the local movement.

“Pacific Rim has hired promoters and advisers that are Mayors, Legislative Deputies, ex-advisers from state ministries, and ex-military officers,” contends Héctor Berríos of the Francisco Sánchez 1932 Unified Movement (MUFRAS-32), a Cabañas-based grassroots organization involved in the anti-mining movement.

“This gives you an idea of the power that they can exercise to make sure the cases aren’t investigated by the Attorney General,” he says. There is a severe terror campaign to destroy the resistance and ensure that gold mining comes to Cabañas, and no one has been prosecuted for a single crime.

Cross-border resistance

In Washington, DC last October, Miguel Rivera of ASIC—brother of assassinated activist Marcelo Rivera—announced to an audience of DC Salvadoran community members and solidarity activists, “The struggle has become an international struggle; it's not just a struggle in Cabañas or in El Salvador. Now the people of El Salvador are looking to the international community to help us defend our country from these North American gold mining companies, because we can't do it alone.”

The CAFTA lawsuit has completely changed the rules of engagement. Instead of fighting the company directly, the movement is relegated to ensuring that the government fights the suit and that popular support for that fight exists. International participation is therefore a strategic way to cultivate that crucial support. For instance, letters to President Funes from US or Canadian legislators pledging support for El Salvador's plight against Pacific Rim would be effective encouragement, coming from two countries that have imposed (or want to impose in Canada’s case) free trade agreements laden with corporate favoritism.

Since the movement’s call for North American support, international involvement has grown dramatically. Through the collective action of international groups along with consistent consultation with the Salvadoran movement a number of strategies have emerged for this multi-pronged, cross-border struggle against Pacific Rim.

Multi-Issue Coalition: A diversity of organizations have been drawn in by the convergence of issues present in El Salvador's anti-mining struggle from an impressive array of sectors: Salvadoran immigrant community, FMLN base committees, trade justice, Latin American solidarity, environmental and anti-mining. The combined experience, resources and tactics of these organizations is creating a flexible and responsive coalition able to carry out simultaneous campaigns, from direct action to legal counsel, tailored to the changing needs and priorities of the Salvadoran resistance.

Incite Public Outrage: International groups are bringing the anti-mining movement’s message to Pacific Rim’s doorstep with a direct pressure campaign. Organizations are regularly targeting the company with everything from postcards to protests at their headquarters. Public pressure has been meticulously tied to a media strategy that openly condemns Pacific Rim for the environmental devastation of the proposed mines, its outrageous CAFTA lawsuit, and the violence surrounding the mines. There is also a full-scale media campaign in force to turn public opinion against the company.

ICSID Counter-Strategies: Understanding the complexities of ICSID lawsuits requires highly specific legal training; Salvadoran and international legal advocates are working together to educate the greater movement on the arbitration process and possible pressure points. Experts are also devising strategies to strengthen El Salvador’s ICSID case. There are plans to submit an amicus curiae brief before the ICSID to introduce the Salvadoran movement's voice into the proceedings.

Fight the Framework: Trade justice movements against CAFTA and other trade agreements are emphasizing Pacific Rim’s suit as a terrifying example of the possibilities under the predominant trade model. Powerful nations are increasingly turning to this model: Canada and the European Union for example are in the midst of negotiating NAFTA/CAFTA-like agreements with Central America. Organizations are mobilizing to pressure US and Canadian governments to fundamentally change this model that privileges corporations over sovereign nations and perpetuates sharp economic inequalities.

During the short span that this international movement has been active, a few principles have surfaced. One lesson is to recognize the presence and grassroots power of transnational migrants. Neoliberalism in Latin America has driven people from their home countries for decades, creating sizable immigrant populations in the very neocolonial nations that forced them from home. It makes sense to incorporate this population into a resource rights struggle based in their home country. In El Salvador’s case, there are two million Salvadorans living in the US, a significant constituency that can be activated through the international network of US-based organizations engaged in the mining struggle.

A final observation is that international solidarity actions go a long way to support the local movement. When publicized in El Salvador, actions and events in other countries demonstrate to Salvadoran movement activists, lawmakers, and the general public that the international community is involved and is on the side of the resistance. Taking the time to coordinate an interview with community media during an action at Pacific Rim headquarters can really boost morale for Cabañas, where lives have been lost, activists organize under the constant threat of danger, and the struggle has been at full-steam for five years.

Cross-border struggle against corporate greed has worked in the past—the restoration of public ownership of water in Cochabamba, Bolivia from the clutches of transnational giant Bechtel being a prime example. That victory has been an important touchstone for movements against neoliberalism across the globe. A victory in El Salvador stands to have the same impact, and victory is a very real possibility. Defeating Pacific Rim in El Salvador can demonstrate, yet again, that international solidarity is the formula to overcome corporate globalization, that those who oppose neoliberalism in the North and South can unite and defend each other from injustices.

It is a challenge to organize across borders, across languages, and across class, which is why it's so important to take note when there is an active movement engaged in a globalized struggle. Powerful nations and transnationals will keep on developing increasingly complex tools, like free trade agreements and the ICSID, to ensure their access to the world's resources and wealth. Though these lawsuits are a new tactic, they are an old story. For the popular resistance to neoliberalism to keep up, cross-border, international coordination will always be crucial. The local mining resistance in El Salvador recognizes that international solidarity was their only viable strategy. The challenge is motivating those who aren't directly affected by the mine to understand that they too have something to gain from victory in El Salvador.

Lisa Fuller is a solidarity activist with the Committee in Solidarity with the People of El Salvador (CISPES). To get involved with the international struggle against Pacific Rim Mining, visit: www.cispes.org or call (202)521-2510.