Mining in Bolivia
Mining in Bolivia has been a dominant feature of the Bolivian economy as well as Bolivian politics since 1557. Colonial era silver mining in Bolivia, particularly in Potosí, played a critical role in the Spanish Empire and the global economy. Tin mining supplanted silvery by the twentieth century and the central element of Bolivian mining, and wealthy tin barons played an important role in national politics until they were marginalized by the industry's nationalization into the Bolivian Mining Corporation that followed the 1952 revolution. Bolivian miners played were critical to the country's organized labor movement from the 1940s to the 1980s.
By 1985, however, the production of every significant mineral in the country had failed to exceed the output registered in 1975. Moreover, the international tin market crashed in 1985. The mining sector in 1987 accounted for only 4 percent of GDP, 36 percent of exports, 2.5 percent of government revenues, and 2 percent of the labor force, compared with 8 percent of GDP, 65 percent of exports, 27 percent of government revenues, and about 6 percent of the labor force in 1977. Spurred by a massive increase in gold production, however, the mining sector rebounded in 1988, returning to the top of the nation's list of foreign exchange earners.
The crisis of 1985 prompted emergency economic measures by the government, including massive layoffs of miners. The twenty-first century has seen a recovery and expansion of the mining sector, and the government of Evo Morales has re-nationalized several facilities. However, as of 2010[update] mining in Bolivia is primarily in private hands, while the vast majority of miners work in cooperatives. Large, foreign owned mines such as Sumitomo's San Cristóbal mine also produce relatively large quantities of minerals. In 2010, 79,043 miners worked in the sector, producing $2.642 billion of mineral products. As of 2011[update], Bolivia is the world's sixth largest producer of tin.
Structure of the mining industry
Corporación Minera de Bolivia (COMIBOL), created in 1952 and decentralzied into five semiautonomous mining enterprises in 1986, was a huge multimineral corporation controlled by organized labor and the second largest tin enterprise in the world. In addition to operating twenty-one mining companies, several spare-parts factories, various electricity plants, farms, a railroad, and other agencies, Comibol also provided schooling for over 60,000 children, housing for mining families, health clinics, and popular subsidized commissaries called pulperías. By 1986 Comibol employed more nonminers than miners.
Observers severely criticized Comibol's mining policies. Comibol took fifteen years to bring tin production to its prerevolutionary levels. In addition, Comibol failed to invest sufficiently in mining technology and existing mines, and it proved unable to open new mines. Indeed, except for the mid-1960s Comibol did not engage in exploration. In terms of administration, worker control eclipsed even technical and detailed administrative decisions.
The decentralization of Comibol under the Rehabilitation Plan reduced the company's payroll from 27,000 employees to under 7,000 in less than a year. All of Comibol's mines, previously responsible for the bulk of mining output, were shut down from September 1986 to May 1987 to examine the economic feasibility of each mine; some never reopened. Comibol's mining and service companies were restructured into five autonomous mining subsidiaries (in Oruro, La Paz, Potosí, Quechusa and Oriente) and two autonomous smelting companies (the Vinto Smelting Company and the still unopened Karachipampa smelter in Potosí), or they were transferred to ministries such as the Ministry of Social Services and Public Health or the Ministry of Education and Culture. The bureaucracy also underwent major administrative changes.
For the first time since 1952, the country's medium miners, small miners, cooperatives, and other producers, which made up the rest of the mining sector, produced more minerals in 1987 than Comibol. The medium miners consisted of Bolivian and foreign mining companies in the private sector that were involved in the production of virtually every mineral, especially silver, zinc, antimony, lead, cadmium, tungsten, gold, and tin. Nevertheless, the collapse of tin and the decline in other commodity prices in the mid-1980s also severely affected the private mining sector. Nineteen mining companies with 4,020 employees constituted the Medium Miners Association (Asociación de Minería Mediana) in 1987, compared with twenty-eight companies and 8,000 workers in 1985. Only 615 mines in 1987 were part of the National Chamber of Mining (Cámara Nacional de Minería), the equivalent of a small miners association, compared with 6,300 mines and 23,000 workers before the crash. Traditionally, small miners had to market their mining output through the Mining Bank of Bolivia (Bancco Minera de Bolivia—Banin), which was also restructured after 1985 into a joint venture of private and public interests. Beginning in 1987, small miners no longer had to sell their exports through Bamin, a policy shift that boosted that group's output and foreign sales. Mining cooperatives and other miscellaneous miners made up the rest of the producers in the mining sector, although their output was aggregated with that of the small mining sector. The National Federation of Mining Cooperatives of Bolivia (Federación Nacional de Cooperativas Mineras de Bolivia) served as an umbrella organization for the country's 434 mining cooperatives, 82 percent of which mined gold. Only a few of these groups, however, were officially registered with the National Institute of Cooperatives (Instituto Nacional para Cooperativas). Most cooperatives were small and consisted of individual miners organized by mine or specific mineral and using very little technology.
The government of Evo Morales re-nationalized the cooperative mines at Huanuni (in 2007) and the smelting facilities in Vinto (in February 2007) and Karachipampa (in January 2011).
Bolivia's mines had produced cassiterite, the chief source of tin, since 1861. Although long among the world's leading tin producers and exporters, the industry faced numerous and complicated structural problems by the early 1980s: the highest cost underground mines and smelters in the world; inaccessibility of the ores because of high altitudes and poor infrastructure; narrow, deep veins found in hard rock; complex tin ores that had to be specially processed to extract tin, antimony, lead, and other ores; depletion of high-grade ores; almost continual labor unrest; deplorable conditions for miners; extensive mineral theft or juqueo; poor macroeconomic conditions; lack of foreign exchange for needed imports; unclear mining policies; few export incentives; and decreasing international demand for tin. Between 1978 and 1985, Bolivia fell from the second to the fifth position among tin producers.
In the late 1980s, however, tin still accounted for a third of all Bolivian mineral exports because of the strong performance by the medium and small mining sectors. The largest tin-mining company in the private sector was Estalsa Boliviana, which dredged alluvial tin deposits in the Antequera River in northeastern Potosí Department. The Mining Company of Oruro operated the country's richest tin mine at Huanuni. The country's tin reserves in 1988 were estimated at 453,700 tons, of which 250,000 tons were found in medium-sized mines, 143,700 tons in Comibol mines, and 60,000 tons in small mines. In the late 1980s, tin was exported mainly in concentrates for refining abroad. Eighty percent of all exports went to the European Economic Community and the United States, with the balance going to various Latin American countries and Czechoslovakia.
Bolivia was a founding member of the International Tin Council (ITC), a body of twenty-two consumer and producer countries that since 1930 had attempted to regulate tin markets through buffer stocks. Bolivia, however, did not sign the ITC's International Tin Agreements in the 1970s and 1980s. In 1983 Bolivia joined the newly formed Association of Tin Producing Countries, which attempted—unsuccessfully—to control tin prices through a cartel approach to commodity regulation. After a period of decline, tin prices rebounded in the late 1980s.
Government policies since the early 1970s had sought to expand the percentage of metallic or refined tin exports that offered greater returns. As a result, smelting increased during the 1970s, but in the 1980s the excessive costs of the nation's highly underutilized smelting operations contributed to the decision to restructure Comibol.
During the presidency of Evo Morales, Bolivia increased government control over and investment in the tin sector. At the Huanuni mines, violent clashes among cooperative miners led to nationalization of the facility in 2007. The government also nationalized the Vinto smelter citing issues of corruption by private owner Glencore in February 2007. The still-unopened Karachipampa was nationalized in 2011 following the regional protest in Potosí's demand for its operation and the failure of foreign investors to accomplish this. In July 2011, the Chinese firm Vicstar Union Engineering (a joint venture of Shenzhen Vicstar Import and Export Co. and Yantai Design and Research Engineering Co. Ltd of the Shandong Gold Group) won a contract to build a new smelter for Comibol at Huanuni.
Silver, zinc, lead, bismuth, and other minerals were all found with Bolivia's large tin reserves and, like tin, were considered strategic minerals. Because of the common mixture of ores, tin mining frequently encompassed the mining of other minerals as well. With the collapse of tin, the government was increasingly interested in exploiting its large reserves of other minerals, particularly silver and zinc. Three centuries after being the world's largest producer of silver, Bolivia still produced 225 tons of silver in 1988, as compared with about 140 tons in 1987. Zinc reserves were large, 530,000 tons, and the expansion of zinc production enjoyed growing government support. Zinc output also rose in the late 1980s from roughly 39,000 tons in 1987 to over 53,000 tons in 1988, compared with 47,000 tons in 1975. Nearly all zinc was exported. In 1987 the government declared the construction of a new zinc refinery in Potosí a national priority. Although the authorities considered lead a minor metal, production increased from 9,000 tons in 1987 to 11,000 tons in 1988. Bismuth reserves were estimated at 4,100 tons, and production in 1987 reached two-thirds of a ton entirely by small miners. Bolivia, the site of the International Bismuth Institute, was once the sole producer of bismuth in the world.
Among Bolivia's largest mining facilities is the San Cristóbal mining complex, an open-pit silver, lead and zinc mine near the town of San Cristóbal, Potosí. The mine, operated by Sumitomo Corporation, produces approximately 1,300 metric tons of zinc-silver ore and 300 tons of lead-silver ore per day, as of August 2010[update],  by processing 40,000 to 50,000 tons of rock.
Bolivia mined about a fifth of the world's antimony in the late 1980s and was the leading producer among market economies. Private companies were responsible for all antimony production. The largest output came from the United Mining Company (Empresa Minera Unificada), which controlled the two largest antimony mines, located at Chilcobija and Caracota, both in Potosí Department. Medium and small miners generated an average of 9,500 tons of antimony a year in the mid-to late-1980s, all of which was exported. Antimony, a strategic mineral used in flameproofing compounds and semiconductors, was exported in concentrates, trioxides, and alloys to all regions of the world, with most sales going to Britain and Brazil. Antimony reserves in 1988 stood at 350,000 tons.
Bolivia was also the leading producer of tungsten among market economies. But the dramatic decline in tungsten prices in the 1980s severely hurt production, despite the fact that reserves stood at 60,000 tons. Medium and small producers accounted for over 80 percent of the country's tungsten production in the late 1980s. The International Mining Company's Chojilla mine was the source of most tungsten output. Tungsten production sank from 2,300 tons in 1984 to barely more than 800 tons in 1987 because of falling international prices. Tungsten was sold to West European, East European, and Latin American countries, as well as to the United States.
Gold cting in the country's rivers and mines was brisk in the late 1980s. Because of Bolivia's vast territory and the high value of gold, contraband gold accounted for approximately 80 percent of exports. Official gold exports were approximately five tons in 1988, up sharply from less than one ton in 1985. In order to capture gold as a reserve for the Central Bank of Bolivia, in 1988 the government offered a 5 percent bonus over the international price of gold on local sales to the Central Bank. Gold was mined almost exclusively by over 300 cooperatives throughout the country, along with about 10,000 prospectors. A large percentage of the cooperatives worked in Tipuani, Guanay, Mapiri, Huayti, and Teoponte in a 21,000-hectare region set aside for gold digging and located 120 kilometers north of La Paz. Mining cooperatives in the late 1980s had requested an additional 53,000 hectares from the government for gold prospecting. Others panned for their fortunes in remote villages like Araras along the Brazilian border in Beni. Small-scale operations were very traditional and wasteful. Analysts predicted that more commercial production, such as the dredging of alluvial deposits, would maximize gold output. A few medium-sized mining operations, as well as the Armed Forces National Development Corporation (Corporación de las Fuerzas Armadas para el Desarrollo Nacional—Cofadena) became involved in the gold rush in the 1980s. Government policy favored augmenting gold reserves as a means of leveraging more external finance for development projects.
The government's mineral policy also gave a high priority to exploiting the lithium and potassium deposits located in the brines of the southern Altiplano's Salar de Uyunia (Uyuni saltpan), estimated to be the largest of their kind in the world. The United States Geological Survey, the Bolivian Geological Survey (Servicio Geológico de Bolivia), and others discovered large reserves of lithium in 1976. By 1985 Bolivia's National Congress had made lithium extraction a national priority and created the Industrial Complex of the of Uyuni Saltpan (Complejo Industrial de los Recursos Evaporíticos del Salar de Uyuni) to explore, exploit, and market lithium. Because the extraction of lithium is an expensive, technically complex process, the government sought bids for some foreign investment in lithium in the late 1980s. In addition to an estimated 5.5 million tons of lithium reserves, Bolivia also had approximately 110 million tons of potassium, 3.2 tons of boron, and an unknown amount of magnesium associated with lithium.
After years of planning, the Mutún iron mine was scheduled to open its first of two plants in 1989. The Mutún mine, the sole responsibility of the Mining Company of the Oriente, was expected to yield 592,000 tons of iron in its first five years of operation. Mutún was also expected to produce manganese. The prospects for the steel industry, which was controlled by Bolivian Iron and Steel (Unidad Promotora de La Siderurgia Boliviana, formerly known as Siderúrgica Boliviana), however, were bleak. After more than a decade of planning a national steel plant, Bolivia was still unable to obtain financing for such a project, especially given international overcapacity in steel. The possibility of a national steel plant appeared unlikely at the end of the 1980s
Processing and smelting industries
The Vinto Smelting and Metallurgica Company (Empresa Metalúrgica y Fundidora Vinto) is a tin smelting facility in Oruro, opened in 1970. It was designed to process tin ore from mines including those at Huanuni and Colquiri. On 20 December 1999, it was privatized by the government of Hugo Banzer Suárez, who sold it to Allied Deals for US$14.7 million. The firm was re-nationalized on 9 February 2007.
The Karachipampa lead and silver smelting facility in Potosí was built to be the nation's largest smelter. Completed in 1984, Karachipampa employed Soviet technology but was constructed by a Federal Republic of Germany (West Germany) company. The smelter's gross capacity is an enormous 51,000 tons per year. Widely criticized for its overcapacity, the plant suffered continual delays due to insufficient ore inputs and lack of investment. In 2010, protests by the Potosí Civic Committee demanded its activation. Following Atlas Precious Metals' unsuccessful efforts to open and operate the plant, Comibol reassumed control of the plant in January 2011. As of May 2011[update], Comibol promises to begin its operation in November; one-quarter of the production at the San Cristóbal mine is pledged as input to the facility.
- Bolivian miners' protest of 2007
- The Devil's Miner
- Thesis of Pulacayo
- Union Federation of Bolivian Mine Workers
- ^ "La minería generó al menos 22.000 empleos el año 2010". Página Siete. 2010-05-03. http://www.paginasiete.bo/Generales/Imprimir.aspx?id=257147. Retrieved 2011-05-03.
- ^ a b c d e Romig, Shane (2011-07-11). "Chinese Firms Awarded $50 Million Contract To Build Bolivia Tin Plant". Fox Business (via Dow Jones Newswires). http://www.foxbusiness.com/industries/2011/07/11/chinese-firms-awarded-50-million-contract-to-build-bolivia-tin-plant/. Retrieved 2011-07-12.
- ^ Shahriari, Sara (12 August 2010). "Related News: Japan Bolivia Protesters Seize San Cristobal Mine Power". Bloomberg. http://www.bloomberg.com/news/2010-08-11/protesters-seize-power-supply-at-sumitomo-metal-s-zinc-mine-in-bolivia.html. Retrieved 29 March 2011.
- ^ "Potosí pierde $us 1 millón por paro minero". La Razón. 29 March 2011. http://www.la-razon.com/version.php?ArticleId=127670&EditionId=2482. Retrieved 29 March 2011.
- ^ "Evo destacó 4 años de nacionalización de la empresa metalúrgica de Vinto". Agencia de Noticias Fides. 2011-02-09. http://www.noticiasfides.com/politica/evo-destaco-4-anos-de-nacionalizacion-de-la-empresa-metalurgica-de-vinto/. Retrieved 2011-05-17.
- ^ "Comibol recupera Karachipampa después de arreglo amistoso con canadiense Atlas Precious Metals :: Noticias de Bolivia de último momento". FM Bolivia. 2011-01-25. http://www.fmbolivia.com.bo/noticia45099-comibol-recupera-karachipampa-despues-de-arreglo-amistoso-con-canadiense-atlas-precious-metals.html. Retrieved 2011-05-17.
- ^ "San Cristóbal dará 25% de producción a metalúrgica". La Razón. 2011-05-17. http://www.la-razon.com/version.php?ArticleId=130490&EditionId=2531. Retrieved 2011-05-17.
- Mining Bolivia's Past by Chesa Boudin, The Nation, April 22, 2009
Mining in South America Sovereign states Dependencies and
Wikimedia Foundation. 2010.
Look at other dictionaries:
Bolivia — Bolivian, adj., n. /beuh liv ee euh, boh /; Sp. /baw lee vyah/, n. 1. a republic in W South America. 7,669,868; 404,388 sq. mi. (1,047,370 sq. km). Caps.: La Paz and Sucre. 2. (often l.c.) a twill fabric made of cut pile with lines either in the… … Universalium
Bolivia — • Includes history, geography, education, church, and government information Catholic Encyclopedia. Kevin Knight. 2006. Bolivia Bolivia † … Catholic encyclopedia
BOLIVIA — BOLIVIA, South American republic; population: 8,724,156 (2004). Jewish population: c. 600. History of Jewish Settlement Desperate to escape the increasingly vehement persecution in their homelands, thousands of refugees from Nazi dominated… … Encyclopedia of Judaism
Mining in Ecuador — played a small role in the Ecuadorian economy in the 1980s, contributing only 0.7 percent to the GDP in 1986 and employing about 7,000 persons. Inaccessibility of the regions where minerals were located and the incomplete exploration of resources … Wikipedia
Mining in Argentina — is an important regional producer of minerals, including primary aluminum, lead, copper, zinc, silver and gold. In 2003 the value of nonfuel mineral production totaled $1.1 billion, of which copper concentrate alone accounted for $467 million.… … Wikipedia
Bolivia — This article is about the South American country. For other uses, see Bolivia (disambiguation). Plurinational State of Bolivia Estado Plurinacional de Bolivia … Wikipedia
Bolivia — <p></p> <p></p> Introduction ::Bolivia <p></p> Background: <p></p> Bolivia, named after independence fighter Simon BOLIVAR, broke away from Spanish rule in 1825; much of its subsequent history has… … The World Factbook
Bolivia — (1971–1982) On 18–22 August 1971 Colonel Hugo Banzer Suárez overthrew the leftist General Juan José Torres González, establishing a dictatorship known as the Banzerato (1971–1978). There are no official estimates of the human rights abuses… … Historical Dictionary of the “Dirty Wars”
Mining Parliamentary Bloc — The Mining Parliamentary Bloc (Spanish: Bloque Minero Parlamentario, BMP) was an electoral political alliance of the Revolutionary Nationalist Movement (MNR) and Revolutionary Workers Party (POR) in Bolivia. The Mining Parliamentary Bloc was… … Wikipedia
Mining — This article is about the extraction of geological materials from the Earth. For the municipality in Austria, see Mining, Austria. For the siege tactic, see Mining (military). For name of the Chinese emperor, see Daoguang Emperor. Simplified… … Wikipedia