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Corporation vs. Nation: The Ultimate Showdown

October 4, 2015

Corporation vs. Nation: The Ultimate Showdown

A secluded private courthouse in Washington DC is currently the scene of a gargantuan legal battle that could have serious ramifications for all of us. Yet virtually nobody knows about it.

On one side of the battle is the tiny, poverty-crippled Central American nation of El Salvador; on the other is Pacific Rim, a Canadian mining company that was acquired by the Australian corporation Oceana Gold in 2013. At stake is the basic issue of who owns what in tomorrow’s world.

Putting Gold Before Water

In 2009, Pacific Rim filed a private lawsuit – what is referred to in the impenetrable jargon of modern globalism as an Investor-State Dispute Settlement (ISDS) – against the government of El Salvador for $301 million, equivalent to just over 2% of the country’s $24 billion GDP. As BBC World reports (in Spanish), the amount is equivalent to three years’ combined public spending on health, education and security.

The company argues that El Salvador unfairly denied its mining permit after it began an exploration process for gold mining, costing it hundreds of millions of dollars of “potential future profits.”

ISDS was originally intended to insulate investors from the costly consequences of expropriation, but it is now increasingly being used by companies to claim future profits foregone as a result of government legislation aimed at protecting the public, as well as to intimidate governments into changing or abandoning such legislation.

In the case of El Salvador, the government changed its mining legislation in order to safeguard the nation’s water supply. As Ciara Nugent writes in the Argentina Independent, a startling 97% of its water is currently unsuitable for human consumption, primarily as a result of the mining activities of companies like Pacific Rim. The miner’s proposed new project, due to take place in the northern San Isidro de Cabañas region, would have implied risks of contamination to the little water that remains:

…click on the above link to read the rest of the article…

 

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