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New Economy Working Group » Article / Magazine Article

Like Water for Gold in El Salvador

July 14, 2011 · · Originally published in The Nation

The story of a community's effort to ban gold mining in El Salvador involves environmental martyrs, powerful economic interests, and a DC-based tribunal that can trump democracy.

Thirty years ago, several thousand civilians in the northern Salvadoran community of Santa Marta quickly gathered a few belongings and fled the US-funded Salvadoran military as it burned their houses and fields in an early stage of the country’s twelve-year civil war. Dozens were killed as they crossed the Lempa River into refugee camps in Honduras.

Today, residents of this area, some born in those Honduran refugee camps, are fighting US and Canadian mining companies eager to extract the rich veins of gold buried near the Lempa River, the water source for more than half of El Salvador’s 6.2 million people. Once again, civilians have been killed or are receiving death threats.

The communities’ goal: to make El Salvador the first nation to ban gold mining. We traveled to El Salvador in April to find out if this struggle to keep gold in the ground can be won. Our investigation led us from rural communities in the country’s gold belt to ministries of the new progressive government in San Salvador and ultimately to free trade agreements and a tribunal tucked away inside the World Bank in Washington, DC.

We were greeted at the airport by Miguel Rivera, a quiet man in his early 30s whose face is dominated by dark, sad eyes. Miguel is the brother of anti-mining community leader Marcelo Rivera, who was disappeared—tortured and assassinated—in June 2009 in a manner reminiscent of the death squads of the 1980s civil war. We had first met Miguel in October 2009, when he and four others active in El Salvador’s National Roundtable on Mining traveled to Washington to receive the Institute for Policy Studies’ Letelier-Moffitt Human Rights Award, a prize that brought international recognition to this struggle.

As we drove on the mountainous roads that lead to Santa Marta and other towns in the northern department of Cabañas, we commented on the starkly eroded parched hills that look like landslides waiting to happen. “We are the second most environmentally degraded country in the Americas after Haiti,” Miguel explained through an interpreter. “How did you come to oppose mining?” we asked. Miguel pointed to our water bottle and said simply: “Just like you, water is our priority.” Over the next days, we would hear testimonies from dozens of people in Cabañas, many of whom are risking their lives in the struggle against mining. Almost all started or ended their stories with some variation of Miguel’s answer: “Water for life,” for drinking, for fishing, for farming—and not just for Cabañas but for the whole country.

Miguel drove us to the office of his employer, ADES (the Social and Economic Development Association), where local people talked with us late into the night about how they had come to oppose mining. ADES organizer Vidalina Morales acknowledged that “initially, we thought mining was good and it was going to help us out of poverty…through jobs and development.”

The mining corporation that had come to Cabañas was the Vancouver-based Pacific Rim, one of several dozen companies interested in obtaining mining “exploitation” permits in the Lempa River watershed. In 2002 Pacific Rim acquired a firm that already had an exploration license for a Cabañas site bearing the promising name El Dorado. That license gave Pacific Rim the right to use such techniques as sinking exploratory wells to determine just how lucrative the site would be.

Francisco Pineda, a corn farmer and charismatic organizer with the Environmental Committee of Cabañas, invited us to spend an afternoon with eighteen of his fellow committee members, some of whom had walked or been driven a long way to join us. One after another, each stood up to tell his or her story. Francisco, who received the 2011 Goldman Environmental Award (which some call the Environmental Nobel Prize), kicked off what became a five-hour session. He talked about watching the river near his farm dry up: “This was very strange, as it had never done this before. So we walked up the river to see why…. And then I found a pump from Pacific Rim that was pumping water for exploratory wells. All of us began to wonder, if they are using this much water in the exploration stage, how much will they use if they actually start mining?”

Francisco, Marcelo, Miguel, Vidalina and others then set out to learn everything they could about gold mining. From experience, they already knew that Cabañas was prone to earthquakes potentially strong enough to crack open the containers that mining companies build to hold the cyanide-laced water used to separate gold from the surrounding rock. Community members traveled to mining communities in neighboring Honduras, Costa Rica and Guatemala, returning home with stories about the contamination of rivers and lands by cyanide and other toxic chemicals. They turned to water experts, university researchers and international groups like Oxfam. A number of people attended seminars on mining in San Salvador.

They also discovered that only a tiny share of Pacific Rim’s profits would stay in the country, and that the El Dorado mine was projected to have an operational life of only about six years, with many of the promised jobs requiring skills that few local people had. And, as a study by the International Union for the Conservation of Nature pointed out, people in Cabañas “living near mining exploration activities began to notice environmental impacts from the mining exploration—reduced access to water, polluted waters, impacts to agriculture, and health issues.”

In community meetings, Pacific Rim officials claimed they would leave the water cleaner than they found it. (The Pacific Rim website is filled with promises about “social and environmental responsibility.”) But many local people were wary of the company’s intentions and honesty. Three people recounted how a Pacific Rim official boasted that cyanide was so safe that the official was willing to drink a glass of a favorite local beverage laced with the chemical. The official, we were told, backed down when community members insisted on authentication of the cyanide. “The company thought we’re just ignorant farmers with big hats who don’t know what we’re doing,” Miguel said. “But they’re the ones who are lying.”

Environmental Martyrs

As the anti-mining coalition strengthened with support from leaders in the Catholic Church, small businesses and the general public (a 2007 national poll showed that 62.4 percent opposed mining), tensions within Cabañas grew. These emerged in the context of other challenges, including the increasing use of Cabañas as an international drug trans-shipment route, with the attendant problems of corruption and violence. While questions remain, many activists believe that pro-mining forces—including local politicians who stood to benefit if Pacific Rim started mining—are ultimately responsible for the 2009 murder of Miguel’s brother, Marcelo Rivera. Marcelo, a cultural worker and popular educator from the Cabañas town of San Isidro, was an early and vibrant public face of the anti-mining movement.

In San Isidro, Rina Navarrete, director of the Friends of San Isidro Association (ASIC), whose founders included Marcelo, stressed that his work lives on through the focus of local groups on cultural work and youth leadership development. Members of another citizens group, MUFRAS-32, led us on a walking tour of this small farming town. At the renamed Marcelo Rivera Community Center, a yellow and red mural with Marcelo’s face above a line of dancing children covers the front wall.

Four other murals painted by youths, on the outside walls of houses owned by sympathetic residents, make it impossible to forget Marcelo’s mission or his assassination. One, for example, offers a dramatic contrast between two alternative paths of development: On the mural’s right side, dark and gloomy “monster” projects, including gold mines, dump waste into a river that bisects the wall. On the other side of the mural’s river, sunlight bathes healthy agricultural land and trees.

ASIC, MUFRAS-32 and other groups continue to organize theater and artistic festivals. Jaime Sánchez, a former theater student of Marcelo’s now in his mid-20s, told us more: “We use theater, songs, murals and other cultural forms to show resistance. We use laughter.” Jaime described ADES’s creation of a radio station, Radio Victoria, which teaches young people to become deejays, production engineers and the other roles of running a station. These young people also took courses on mining, and spread what they learned over the airwaves.

Over a six-day period in late 2009, two other local activists were killed, one a woman who was eight months pregnant; the 2-year-old in her arms was wounded. ADES’s Nelson Ventura barely escaped an attack. Hector Berrios and Zenayda Serrano, lawyers and leaders of MUFRAS-32, had their home broken into while they and their daughter slept, and documents related to their work were stolen. As Hector lamented, “Clandestine organizations still operate with impunity in this country.”

Many of the people we interviewed, including youths at Radio Victoria, have received death threats. One person told us he turned down a $30-a-week offer to meet with representatives of Pacific Rim to inform on anti-mining activists. Mourned another: “Now in our communities, you don’t trust people you’ve trusted your entire life. That’s one of the things the mining companies have done.”

Democratic Spaces

We traveled from mining country to San Salvador, visiting the sprawling Cuscatlán Park. Along one wall is the Salvadoran version of the US Vietnam Veterans Memorial, in this case etched with the names of about 30,000 of the roughly 75,000 killed in the civil war. Thousands of them, including the dozens killed in the Lempa River massacre of 1981, were victims of massacres perpetrated by the US-backed—often US-trained—government forces and the death squads associated with them.

Peace accords were signed in 1992, and successive elections delivered the presidency to the conservative and pro–free trade ARENA party until 2009, when the progressive Farabundo Martí Liberation Front (FMLN) won the largest bloc in the Congress and, two months later, the presidency. Anti-mining sentiment was already so strong in 2009 that both the reigning ARENA president and the successful FMLN candidate, Mauricio Funes, came out against mining during the campaign.

Much of the credit for this goes to the National Roundtable on Mining, formed in 2005 as leaders in Cabañas began meeting with groups from other departments where mining companies were seeking permits, as well as with research, development, legal aid and human rights groups in San Salvador. Roundtable facilitator Rodolfo Calles enumerated the goals they collectively agreed upon after arduous deliberations: to help resistance at the community level; to win a national law banning metals mining; to link with anti-mining struggles in Honduras and Guatemala, since the Lempa River also winds through those two countries; and to take on the international tribunal in which Pacific Rim is suing El Salvador. Part of what moved the Roundtable to the “complete ban” position, Francisco Pineda explained, “was the realization that the government lacked the ability to regulate the mining activities of giant global firms.”

We were eager to understand how the still relatively young FMLN-led government was deciding whether to ban metals mining. Roundtable members told us the Funes government had announced it would grant no new permits during his five-year term and that it was considering a permanent ban. They also told us the government had initiated a major “strategic environmental review” to help set longer-term policy on mining.

We visited the ministry of the economy, which, along with the environment ministry, is leading the review. The man overseeing it, an engineer named Carlos Duarte, explained that the goal was to do a “scientific” analysis, with the help of a Spanish consulting firm (with Spanish funding). We pushed further, trying to understand how a technical analysis could decide a matter with such high stakes. On the one hand, we posed to Duarte, gold’s price has skyrocketed from less than $300 an ounce a decade ago to more than $1,500 an ounce today, increasing the temptation in a nation of deep poverty to consider mining. We quoted former Salvadoran finance minister and Pacific Rim economic adviser Manuel Hinds, who said, “Renouncing gold mining would be unjustifiable and globally unprecedented.” On the other hand, we quoted the head of the human rights group and Roundtable member FESPAD, Maria Silvia Guillen: “El Salvador is a small beach with a big river that runs through it. If the river dies, the entire country dies.”

Duarte explained that the Spanish firm, backed by four technical experts from other countries, had carried out a lengthy study of the issues and was consulting with people affected by mining, ranging from mining companies to the Roundtable groups. While he hoped this process would produce a consensus, Duarte admitted it was more likely the government and the firm would have to lay out “the interests of the majority,” after which the two ministries would then make their policy recommendation. (Roundtable members had told us that the first group consultation, about ten days earlier in San Salvador, had turned into a pitched debate between them and representatives of the mining companies.) “If new laws are necessary,” Duarte informed us, “then it will go to the legislature.”

We proceeded to the national legislature, its hallways a cacophony of red posters bearing the photos of FMLN leaders (and the ever-present martyr Archbishop Oscar Arnulfo Romero, assassinated in 1980 by the right) competing with offices adorned with posters of the leading opposition party, ARENA. We came to meet FMLN members of the legislature’s environment and climate change committee, including Lourdes Palacios, a three-term member from San Salvador with purple glasses and an easy smile. Palacios explained that they were ready with a bill to ban metals mining, but at the request of the executive branch, they were waiting for the outcome of the review before introducing it.

A representative from the department of Chalatenango, just west of Cabañas and an FMLN stronghold, expressed impatience at how long the review was taking and his conviction that “economic and political powers” were “putting pressure on non-FMLN legislators.” For the FMLN legislators, he stressed, “the pressure is the will of the people, and we are convinced that the majority of the people don’t want mining.” The FMLN does not have an absolute majority in the legislature; still, those present expressed confidence that the ban could pass if the executive branch recommended it. One legislator suggested that El Salvador might have an easier time saying no than countries already dependent on revenues from gold exports.

Given the human rights situation in Cabañas, we interviewed the government’s human rights ombudsman, a post created after the 1992 peace accords, to be selected by, and report directly to, the legislature. The current ombudsman is Oscar Luna, a former law professor and fierce defender of human rights—for which he too has received death threats. We asked Luna if he agreed with allegations that the killings in Cabañas were “assassinations organized and protected by economic and social powers.” Luna replied with his own phrasing: “There is still a climate of impunity in this country that we are trying to end.” He is pressing El Salvador’s attorney general to conduct investigations into the “intellectual” authors of the killings. Several people have been arrested in connection with Marcelo Rivera’s assassination, but the attorney general’s office appears to be dragging its feet in digging deeper into who ordered and paid for the killings. Critics told us that the attorney general, appointed by the legislature as a compromise candidate between ARENA and the FMLN, has failed to investigate aggressively a number of sensitive cases involving politicians, corruption and organized crime.

Our interactions in Cabañas and San Salvador left us appreciative of the new democratic space that strong citizen movements and a progressive presidential victory have opened up, yet aware of the fragility and complexities that abound. The government faces an epic decision about mining, amid deep divisions and with institutions of democracy that are still quite young. As Vidalina reminded us when we parted, the “complications” are even greater than what we found in Cabañas or in San Salvador, because even if the ban’s proponents eventually win, “these decisions could still get trumped in Washington.”

A Tribunal That Can Trump Democracy

Protesters around the globe know the sprawling structures that house the World Bank in Washington, yet few are aware that behind these doors sits a little-known tribunal that will be central to the Salvadoran gold story. The Salvadoran government never approved Pacific Rim’s environmental impact study, and thus never gave its permission to begin actual mining. In retaliation, the firm sued the government under the 2005 Central American Free Trade Agreement. Like other trade agreements, CAFTA allows foreign investors to file claims against governments over actions—including health, safety and environmental measures and regulations—that reduce the value of their investment. The affected farmers and communities are not part of the calculus. The most frequently used tribunal for such “investor-state” cases is the International Centre for Settlement of Investment Disputes, housed at the World Bank.

In the words of lawyer Marcos Orellana of the Center for International Environmental Law, who assisted the Roundtable in drafting an amicus brief for the tribunal, Pacific Rim “is trying to dictate El Salvador’s environment and social policy using CAFTA’s arbitration mechanism.” Pacific Rim’s “claim amounts to an abuse of process.” The brief methodically lays out how Canada-headquartered Pacific Rim first incorporated in the Cayman Islands to escape taxes, then brazenly lobbied Salvadoran officials to shape policies to benefit the firm, and only after that failed, in 2007 reincorporated one of its subsidiaries in the United States to use CAFTA to sue El Salvador.

For this article we attempted to interview Pacific Rim board chair Catherine McLeod-Seltzer, but her office steered us to the CEO of Pacific Rim’s US subsidiary, Thomas Shrake. In a tersely worded e-mail, he “respectfully denied” our request.

Pacific Rim is demanding $77 million in compensation. A case brought against El Salvador by another gold-mining company, Commerce Group, was dismissed earlier this year on a technicality, but the government still had to pay close to $1 million in legal fees and for half of the arbitration costs. Dozens of human rights, environmental and fair-trade groups across North America, from U.S.-El Salvador Sister Cities and the Committee in Solidarity With the People of El Salvador (CISPES) to Oxfam, Public Citizen, Mining Watch and the Institute for Policy Studies, are pressuring Pacific Rim to withdraw the case.

Many believe that even if Pacific Rim withdraws its case or loses in this tribunal, the very existence of “investor-state” clauses in trade agreements is an affront to democracy. “For democracy to prevail,” Sarah Anderson of IPS told us, “citizens’ movements and their allies in governments must work hard to eliminate these clauses from all trade and investment agreements.”

Back in Santa Marta, citizen groups are building sustainable farming as an alternative economic base to mining. Their goal: a “solidarity economy,” or, as Vidalina termed it, a “people’s economy.” Explained Vidalina: “We reject the image of us just as anti-mining. We are for water and a positive future. We want alternatives to feed us, to clothe us.”

Elvis Nataren, a philosophy student, led us to the riverbank and pointed to communal land where organic farms will be built. Three towering greenhouses already contain plump hydroponic tomatoes, green peppers and other vegetables. Together these should make Santa Marta self-sufficient in corn, beans and vegetables. As Elvis explained, “food sovereignty” was even more urgent in the wake of CAFTA’s passage, given the cheap foreign produce that began to flood the Salvadoran market. Elvis, Vidalina, Miguel, Francisco and others we met in Cabañas were well aware that as they nurture farmlands and the river vital to this alternative future, their success also depends upon struggles and debates in San Salvador and Washington.

A month after we returned home, the death threats against individual youths at Radio Victoria escalated, with such ominous untraceable text messages as: “look oscar we aren’t kidding shut up this radio or you also die you dog…”

And in June, nearly two years after Marcelo Rivera’s murder, the body of a student volunteer with the Environmental Committee of Cabañas was found dead, with two bullets in his head. As the Roundtable press release noted: “The last time he was seen by fellow environmental activists was…distributing fliers against metallic mining in [Cabañas] in preparation for a public consultation about the mining sector taking place nearby.” “Not another mine, not another death,” implored the Roundtable.

This article appeared in the August 1-8, 2011 edition of The Nation.

 

Robin Broad is a professor at American University's School of International Service, and John Cavanagh is director of the Institute for Policy Studies.  Their most recent book is Development Redefined: How the Market Met its Match.

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