The Las Bambas mine is reopening, why is it important for the country’s economy?

Mining company Las Bambas, one of the main copper producers in Peru and the world, has resumed operations after being paralyzed for more than a month due to social conflicts and roadblocks in the south of the country, but why is this so important? National economy?

Apurimac Chamber of Commerce President Edward Palacios clarifies that for Peru, Las Bambas represents 1% of GDP, i.e. 9,300 million soles, and for his region this means about 80%, so one day of closure generates strong losses.

“This means that on the day of Las Bambas paralysis, Apurimac loses approximately 3.8 million salts per day, while Peru loses 5.2 million salts per day. Every day we lose the opportunity to give Peru more access to healthcare,” he explained.

Most of these resources that the country receives are transferred by the concept of canon and royalty contract payments paid by the mining company, which amount to about 1,115 million soles, according to the Macroconsult report.

But how did these mining revenues improve the economic situation of the Apurimac region? This explains the chief economist of the Peruvian Institute of Economics (IPE), Victor Fuentes.

“Las Bambas had a significant impact on Apurimac’s economic growth, allowing GDP region increased 2.4 times between 2015 and 2016, rising from the lowest level in the country in 2015 to ninth among the country’s 25 regions. In addition, over the past decade, Apurimac’s poverty rate has halved, from 56% in 2012 to 28% in 2021,” he said.

Macroconsult’s study concludes that the mining company’s investment has improved household incomes in Chaluhuacho, Mara and Tambobamba counties, as well as access to services, housing and food.

And how does it contribute to exports? ComexPerú economic research analyst Daniel Najarro explains how much sneaker production represents for overseas sales.

“The contribution of the Las Bambas mining company is not limited to Apurímac. Last year bambas they contributed nearly $2 billion in exports, of which $1,868 million was in copper minerals, accounting for 11.2% of total exports. At the same time, molybdenum was sent for $118 million, which is 10.7% of the total volume,” the specialist said.

Despite its importance, production at Las Bambas fell 12.2% last year due to social conflicts that paralyzed operations for weeks.

In 2017, the mining company positioned itself as the second national producer copperHowever, constant blockades year after year led to a decrease in production.