Digging deeper
The government stands by its new regulatory scheme
COLOMBIA is the world’s tenth-largest coal producer. It also supplies 55% of the world’s emeralds. However, most of its mining potential remains untapped: the industry makes up just 2.4% of GDP. For decades foreign investors were scared off by the country’s endemic violence. But by the mid-2000s, as security improved and commodity prices soared, mining seemed poised for rapid growth. The government of Álvaro Uribe encouraged this with tax breaks and investment incentives.
Those inducements may have worked too well. Foreign investment in mining did rise ninefold in the decade to 2011. However, a handful of big companies made up most of the increase, while officials were swamped by licence requests from smaller firms. By February 2011 more than 19,000 had piled up, creating a massive backlog.
This article appeared in the The Americas section of the print edition under the headline "Digging deeper"
From the August 4th 2012 edition
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