Industry Trend Analysis - Protests To Limit Growth And Deter Investment - JAN 2016

BMI View : Increasing local opposition to mining in Central America and the Caribbean will remain a key challenge to extractive firms in the region. Combined with persistent mineral price weakness, this will curb investment interest and delay new project s from coming online.

Rising tensions between local communities and international mining firms in Central America and the Caribbean will continue to raise costs for miners through operational disruptions and lawsuits. Both factors will contribute to project delays and declining investment in the sector over the coming quarters. This trend will play out more violently in Guatemala and Honduras, while rising local opposition in Panama, the Dominican Republic and Jamaica will negatively affect production and investment more than heightening security risks. We expect these countries' mining industry values to edge higher during 2016-2019, averaging USD917mn, USD173mn, USD725mn, USD907 and USD173mn in Guatemala, Honduras, Panama, the Dominican Republic and Jamaica, respectively. Despite this, the mining industry contribution to GDP of these countries will remain minimal, averaging less than 2.0% of total GDP in 2016. Furthermore, nearly every above mentioned countries' major mines have faced protests, on grounds of environmental damage, health concerns, or indigenous land rights violations during 2015.

Highest Operational Risk In Guatemala & Honduras

Contribution To Remain Minimal
Select Countries - Mining Industry, % Of GDP
e/f = BMI estimate/forecast. Source: National sources, BMI

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