Americas

Peru community to suspend Antamina protest that rattled markets

3 minute read

Julio Velarde, president of the Central Bank of Peru, speaks during an interview with Reuters at Central Bank headquarters in Lima, Peru April 30, 2018. REUTERS/Mariana Bazo/File Photo

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LIMA, Nov 2 (Reuters) - A rural community in Peru will lift its blockade of the country's largest copper mine Antamina on Wednesday after protests forced miners to suspend operations, the Peruvian Ministry of Energy and Mines said in a tweet.

The protest, part of a spate of movements against miners in Peru, sent jitters through the Andean country's markets on Tuesday, raising a test for leftist President Pedro Castillo.

Castillo sent officials to the area on Tuesday to negotiate after protesters told Reuters they would not lift the blockade without first holding formal talks between all parties.

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Antamina did not respond to a request for comment on the agreement.

The Energy and Mines Ministry said the protest would only be lifted on Wednesday when Antamina would sign a formal agreement for talks.

Talks will resume on Friday with a visit by Antamina CEO Victor Gobitz, according to a copy of the agreement tweeted by the office of Peru's prime minister.

The world's no. 2 producer of copper saw its sol currency and equities markets weaken on Tuesday, with traders pointing to the unrest that has hit mines owned by Glencore (GLEN.L), BHP Billiton and MMG Ltd (1208.HK) in recent weeks.

The country's largest copper producer Antamina suspended operations on Sunday due to a roadblock established by demonstrators from the rural Aquia community.

Castillo came to power in July on the back of strong support from voters in mining regions, pledging to redistribute mineral wealth to communities who have long complained that they have been left behind in the country's copper-driven economic boom.

'NO BENEFITS'

Adan Damian, the leader of the Aquia community, previously told Reuters that Antamina was bringing them "no benefits," in an interview early on Tuesday before the decision was made.

He said that the main grievance is that Antamina has never fully paid Aquia for the lands it used, an allegation the company has disputed in the past. read more

Damian did not respond to a request for comment after the agreement was made.

The recent spike in tensions have led industry bodies to decry a "spiral" of protests and prompted the industry friendly central bank chief Julio Velarde to say the protests were hitting the country's traditionally strong image as an investment market.

"Obviously order needs to reestablished," Velarde said on Tuesday as he was sworn in for an additional five-year term.

A currency trader at a Lima bank said the local sol currency was falling on the political backdrop and "really negative news" of suspension of production at Antamina.

The currency weakened 0.43% to above 4 per dollar, while a Lima stock index .SPBLPSPT lost around 0.36%.

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Reporting by Marcelo Rochabrun and Marco Aquino; Editing by Mark Potter and Aurora Ellis

Our Standards: The Thomson Reuters Trust Principles.

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