Gold, Silver, Copper And The Peru Free Trade Agreement
GOLD, SILVER, COPPER AND THE PERU FREE TRADE AGREEMENT -- (House of Representatives - December 05, 2007)
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Ms. KAPTUR. Mr. Speaker, I wish to review a recent vote that was held here in this Congress regarding the so-called Peru Free Trade Agreement, and to encourage the American people to read the fine print and to pay attention to the connection between that Peru vote and the value of the U.S. dollar and some hidden forces that may have been responsible for bringing that vote on Peru to the forefront now. Because people in my district were saying, why vote on Peru now? Why vote on another NAFTA-like accord on trade when our balance of trade is so seriously out of whack? Let me mention for the Record, and I will place these articles in the Record this evening; Peru is the world's third largest producer of copper, zinc and tin. It is the biggest producer of silver, and is the fifth largest producer of gold. In fact, Peru has the largest gold mine in this hemisphere owned by an American company.
Many workers in the mines in Peru went on strike. Over 6,300 workers took their lives in their hands the Monday before the vote trying to send a message to the people of the United States and this Congress that they are treated unfairly, the wages they earn, conditions under which they work, their ability to share in profits, the ability to have decent pensions; all of those were very important issues. Their
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voices were hardly heard. It does not mean that they were not speaking truth to power; it means that certain ears here in Washington may have been closed, but they still spoke to us.
Mr. Speaker, the dollar continues its downward spiral. In fact, we know the value of our dollar has fallen by nearly a quarter against a trade-weighted basket of currencies. And while that dollar is falling, other commodities in the market are growing in value. And guess what those are. Metals. Metals are constituting a very large share of where people are moving assets because the dollar is losing its value. In fact, the U.S. Mint just directed that the American people aren't supposed to be melting down pennies for the copper content in them.
The Economist pointed out that in 2002 the euro was worth 86 cents; today, it buys $1.48. We know our credit markets are troubled. Credit Suisse predicted that gold would top $1,000 an ounce by 2012. There are big interests at stake in deals like this deal that was just passed in this House for Peru, and gold and silver and copper have a lot to do with it.
In an article entitled, ``Miner Player'' last month in the Economist, it reported, ``The net profits of mining companies rose from $4 billion in 2002 to $67 billion in 2006.'' They're doing very well, thank you, but they are not sharing in that extraordinary increase in wealth with their own citizens. In fact, the export of these precious metals accounts for over half of Peru's export earnings, over half from mines owned by companies in this country. Are you beginning to get the picture?
The overall profitability of these concerns, which was negative in 1998, is now four times the 7 percent average of growth for the top 500 companies, and the dominant U.S. import from Peru is? Gold, constituting 24 percent of their exports in 2006.
So, when the miners of Peru, who work under godforsaken, horrendous conditions, tried to get our attention, this Congress turned its back. You hardly heard anything in the debate, but they were standing tall in their villages all across Peru. In fact, what's happening to the peasants in Peru is they're being shoved off their land because there might be gold underneath it. And they're crying out to us. Will anyone, for heaven's sake, will anyone here in this country hear them?
The article that was published on Monday before the vote indicated that Peru's Labor Ministry ordered the miners to go back to work or they would lose their jobs. And we were told that, oh, don't worry about the vote on Peru because labor conditions in Peru are just terrific. Well, the article that came out from Bloomberg News Service on November 6 indicated that, in fact, the government had declared the mining strike illegal.
We weren't listening to them. It's really tragic that when an agreement comes before us like this, we do not listen to those who are the least among us and speak truth to power.
I place all these articles in the Record this evening.
Peru To Declare Mines Strike Illegal, Pinilla Says
(By Alex Emery)
Nov. 6 (Bloomberg).--Peru's government will declare a two-day national mining strike illegal today, forcing miners to return to work or lose their jobs, Labor Minister Susana Pinilla said.
The strike, which seeks to pressure companies to improve pensions, profit-sharing and rights for subcontracted workers, is ``politically motivated,'' Pinilla told Lima-based CPN Radio.
``Union leaders have a different stance that has nothing to do with worker vindication,'' Pinilla said. ``They have led workers into an illegal strike where they could lose their jobs.''
Strikes this year, including a five-day national walkout by Peruvian miners in May, have cut copper output in Peru, Chile and Mexico, helping to spur a 17 percent rally in the price of the metal. Peru is the world's third-largest producer of copper, zinc and tin, the biggest of silver and fifth-largest of gold.
The stoppage in Peru has affected mines owned by companies including Southern Copper Corp., Freeport-McMoRan Copper & Gold Inc., Newmont Mining Corp. and Doe Run Resources Corp.
Workers also are on strike at mines run by Cia. De Minas Buenaventura SA, tin miner Minsur SA, Shougang Hierroperu's iron mine and zinc producers Cia. Minera Raura SA and Cia. Minera Santa Luisa, according to Mining Federation spokesman Cirilo Yarihuaman.
TALKS PLANNED
Southern Copper's Peruvian mines, where 20 percent of workers went on strike, don't expect production losses, parent Grupo Mexico said in a filing to the Mexican Stock Exchange.
National metals output hasn't been cut and only 6,300 workers, or 5.3 percent of Peru's miners, are on strike, Pinilla said. The Mining Federation put the number at 45,000.
Union leaders planned to hold talks with Cabinet chief Jorge del Castillo and the president of Congress, Luis Gonzales Posada, to pass laws granting miners a 10 percent share of profits, up from the current 8 percent, and eight-hour shifts instead of the 12 hours imposed at many mines, Yarihuaman said.
The federation, which represents 70 unions and 28,000 miners, also wants 85,000 subcontracted workers put on company payrolls.
Copper futures for December delivery rose 3.95 cents, or 1.2 percent, to $3.3415 a pound on the Comex division of the New York Mercantile Exchange. Zinc rose $95, or 3.5 percent, to $2,820 a metric ton in London trading, and tin rose $345, or 2.1 percent, to $17,095 a ton.
Silver for December delivery rose 59.5 cents, or 4 percent, to $15.38 an ounce. Gold for December delivery rose $12.60, or 1.6 percent, to $823.40 an ounce.
``The strike in Latin America is quite supportive to prices,'' Dan Smith, an analyst at Standard Chartered Plc in London, said today by phone.
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Protesters Return to Work and End National Mining Strike in Peru
Peru's Labor Ministry announced today that mining workers had returned to work and ended the strike they began on Monday, November 5.
The Labor Ministry attributed workers' surrender to the fact that the strike had been declared illegal and that workers had been told they could lose their jobs if they left their workplaces for more than three days.
Peru's Labor Minister, Susana Pinilla announced on Monday that Peru's National Federation of Mining, Metallurgy and Steel Workers had not formally filed any complaints and that there weren't any issues which had to be resolved. She added that strikes and protests were rights workers had when there were formal requests pending.
Pinilla clarified that Peru's Labor Ministry had not received any formal complaints and would therefore consider the strike illegal. She suggested that workers find better ways to negotiate their demands.
Minera Yanacocha. Latin America's largest gold mine, run by reported that the 109 workers, which had taken part in the strike, had returned to work. This was also the case in mining companies such as Chungar, Morococha and Sociedad Minera El Brocal.
According to the Mining Federation, workers from Casapalca had also abandoned the strike and returned to work. Pinilla stated that the strike had not had a significant impact on mining production, explaining that just over 5 percent (6,300) of workers had taken part in the strike.
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