South America’s Latest Silver Mine

South America has recently seen a new acquisition, specifically in Bolivia. The country saw the expropriation of a mine operated by a Canadian company, South American Silver. The mine is primarily concerned with the mining of iridium and silver and apparently Mario Virreira, the country’s minister for mining has given the state total control of any excavation of activities related thereto.

Authorities in Bolivia are denying the existence of an agreement made with South American Silver to mine in Malku Khota, a small community located south of the country’s capital, La Paz. Independent contractors are being brought in to determine the worth of resources in the mine.

Representatives in Canada have responded with disappointment and the claim that this move will dissuade any foreign investors from trading with the country, and its government. It seems that they are correct, since Indian company, Jindal Steel and Power recently stopped their plans to invest in the country’s mining concerns, a move which cost the country about $2 billion.

So why has the government made this move? It claims that the country’s people are not pleased with foreign concerns and recently occupied the site by force, armed with explosives. The month long standoff saw people injured and in an effort to improve relations with its citizens, the government instituted its new plans.

This particular mine is one of the largest resources of silver and iridium, the metal used for LCD TVs, and it may also contain gallium, a metal used in microelectronics. Without a significant investment of capital, there won’t be any exploration for gallium though, and the government may see a lot of time go to waste in their efforts to excavate.

As for foreign investors, many do not want to invest in a country that has taken such extreme measures, no matter how great the reward, and this speaks volumes for the future of the country. Whether the government will relent remains to be seen, but in the meantime foreign investors are ploughing more money into other countries that will honour agreements, according to South American Silver.

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