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Peru Mining Strike Looking Inevitable, Unions Say

Reuters
Friday, 27 Apr 2007 | 5:11 PM ET

Peru's largest miners union on Friday said a nationwide strike set for Monday looked increasingly inevitable, but it would meet again with government officials in the afternoon to try to reach a deal.

Luis Castillo, president of the National Federation of Metallurgic and Steel Miners, told Reuters: "The decision has been made. There is no turning back on the strike."

Castillo said another meeting with government officials was scheduled for 3 pm local time, "but we don't foresee anything (resulting) because our positions haven't grown any closer."

The federation is demanding that President Alan Garcia fulfill campaign pledges to eliminate all outsourcing among mining companies and to improve pension benefits, among other things.

Miners were unable to reach an agreement with labor ministry officials on Thursday.

The federation groups 74 mining unions in Peru, representing some 22,000 workers. About 110,000 miners are estimated to work in the sector overall.

Officials at the National Society of Mining, Petroleum and Energy -- which comprises the largest private companies operating in these sectors -- have said that, if the strike went ahead, some mines would be unaffected.

They have said a walkout would hurt the investment climate in Peru, but they have not specified the protest's potential impact on metals production.

Labor Minister Susana Pinilla was due to meet with representatives from mining companies at around midday on Friday, a ministry spokeswoman said.

Mining is one of the economy's main drivers and accounts for more than half of Peru's export earnings. The South American country is the world's No. 3 copper and zinc producer, a top-two silver producer and No. 5 in gold.

The last nationwide strike took place three years ago, when miners stopped work for 48 hours to protest labor policies under then-President Alejandro Toledo.

Getting on Board

Castillo said the government declared the strike "inadmissible" because companies were not notified ahead of time. But he said the federation will appeal the measure, which would enable firms to fire striking workers.

Refinery workers and miners at world heavyweight Southern Copper'sPeru operations have said they will strike to demand better job benefits, even if the nationwide walkout is called off.

Workers at Southern Copper's Ilo smelter plan to start striking on Saturday, while miners at the Cuajone and Toquepala pits will stop work on Monday.

At many other mines though, workers only plan to strike if their federation does.

Workers at Yanacocha, the largest gold mine in Latin America which is controlled by U.S.-based Newmont Mining , plan to strike, as do workers at the Peruvian unit of U.S.-based Doe Run Co., which runs the country's largest smelter complex.

At Buenaventura , Peru's top precious metals miner, unions are expected to strike at some sites, including the company's Uchucchacua silver mine.

"Hopefully we will get to terms with our own union and make them work or try to convince them to continue working on Monday," Buenaventura's chief executive Roque Benavides said in a conference call.

However, miners at the Antamina mine -- one of the world's biggest producers of copper and zinc -- are not affiliated with the federation and do not plan to strike, a union leader said.

The majority of Peru's mines are controlled by large multinational companies, which have seen their profits surge thanks to high metals prices. Workers demands for a greater share of those profits have also increased.

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Compania de Minas Buenaventura SAA
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