Copper mine row threatens Panama’s economy and business-friendly reputation
Copper miner First Quantum Minerals is slowing processing at its Panamanian mine and could fully shut down operations as the company clashes with the Panamanian government, Bloomberg reports. Late last year, the two sides failed to reach an agreement over issues including taxation levels.
The Panamanian government escalated the feud earlier this month, preventing the loading of copper concentrate at the port, effectively stopping First Quantum from exporting. With limited storage capacity at the mine, the Canada-based miner warned that it would soon run out of space and be forced to begin laying off its workforce of 8,000 people in Panama over the next few weeks if it wasn’t allowed to resume shipments.
Panama is joining Mexico, the Democratic Republic of Congo, Pakistan, Peru, Bolivia, Chile, Zambia, Tanzania and Australia in pushing mining companies for tax or ownership increases. But while investors expect the duel to be short-lived, Panama’s hardball tactics could threaten its perception as a mining- and business-friendly jurisdiction.
