The mining canon has reached a record level this year, are these resources being used properly?

So far this year, revenue from mountain canon hit the record after adding 7,844 million salts, according to the Ministry of Economy.

The amount exceeds the maximum value reached in 2007 due to strong price increase metals that have been reported since 2021, but what is the canon and what should it be used for?

“50% of mining rent income becomes a canon, and this canon is divided among the local and regional governments of the mining area. It is assumed that this is money that should be used for works and infrastructure. in the regions, the problem is that the canon is used inefficiently, and to this is added the problem of corruption,” explained the former Minister of Energy and Mines, Carlos Herrera Descalzi.

Regions that generate the most revenue from the mining canon: Ancash, Arequipa, Tacna, Moquegua, Ica and Cusco. According to INEI data, half of these six oblasts have poverty rates above 19%.

The area with the most mining resources, San Marcos in Ancash, is not only one of the poorest in the country, but also has the worst budget execution in 2021.

why are these big income money is not perceived by the population? The General Director of the Institute of Mining Engineers Carlos Diez Canseco commented on this to the RPP.

“In fact, little is used for the benefit of the population. Of the 7.8 billion that is paid out, subnational governments only have an average utilization rate of around 30% for every 100 soles they transfer. have the ability to use only 30% and they also do not use that 30% efficiently because they usually do not carry out projects that benefit the population, and many of these projects are interrupted before they are completed,” said Diez Canseco.

The ComexPerú analysis warns that last year alone, the unfulfilled canon was the equivalent of building and equipping 24 hospitals or access to sanitation for more than 1.1 million rural Peruvians.

Lety Gomez, economic research analyst at ComexPerú, notes that ideally, the resources received Canyon they should be used to address the gaps that each area faces, but the priorities set by governments vary.

“There is a bad prioritization. The least allocated are public order and safety, health and the environment. the budget was spent on transportation, planning, management and contingency reserves, and education. However, education has caught our attention because the participation of the education function has increased from 15% of all used to 9% between 2009 and 2021,” he elaborated.

ComexPerú also warns that the problem is not only the level of spending and existing corruption, but also the high concentration of resources in the distribution of the canon.

Currently, only 4% of national level municipalities, including San Marcos (Ancash), Yarabamba and Cerro Colorado (Arequipa), account for half budget which is distributed according to canon, surcharge and royalty, and the same municipalities represent the smallest execution, reflecting deficiencies in infrastructure, sanitation, health care and education.