Argentina will have to create a stable and predictable environment around its Mining Investments Law if it wants to promote investment in mining, according to Argentine Chamber of Mining Businessmen Secretary Hernán Zaballa.
While the law has been in place since December 1993, offering three decades of stability to mining companies developing feasible projects in the country, its erratic administration has still left some investors cautious, according to Zaballa.
“I believe the problem does not have to do with the existing laws, but with their predictability and sustainability,” Zaballa said.
“What is important for investors is that the game rules remain the same.”
Zabella told Mining Weekly that investors under the law benefit by not receiving tax hikes at the municipal, provincial and national level when filing the feasibility study for a project.
A 3% cap is also placed on all royalties from mine takings and no duty is charged for importing certain goods and machinery for mining work if it provides security for long-term projects.
Discrepancies still exist, however, between national and local laws, making it difficult for mining companies to clear the red tape before operations can start.
Zaballa represents Vancouver-based Pan American Silver, which is mining the Navidad silver project in the Argentine province of Chubut.
Pan American Silver is currently working with local communities to overcome local laws that prohibit certain mining activities in the region.