Ecuador, seeking investment, buffs up mining sector image
By Nicole Mordant and Susan Taylor
TORONTO, March 4 (Reuters) - Rebranding itself as a mining-friendly jurisdiction, Ecuador has high hopes that incentives and tax benefits will polish its tarnished image and attract $5 billion worth of investment over the next five years, a senior minister told Reuters.
The small Andean nation believes that incentives passed in October will attract foreign miners to help develop its gold and copper riches. They include 30-year investment contracts that promise tax stability, and accelerated depreciation.
"We have made the decision that mining constitutes a central axis of our development plans," said Rafael Poveda, Minister of Strategic Sectors, which includes Ecuador's mining ministry.
"We want mining to constitute the axis which will allow us to improve living conditions for communities and 15 million Ecuadorians," he said at Toronto's Prospectors and Developers Association of Canada conference on Monday.
The country sponsored "Ecuadorian Day" at this year's show, which included a speech by the minister of mining and project presentations.
While a handful of foreign miners have ventured into Ecuador in the past decade, investment has been minimal.
The country's reputation took a hit in 2013, when large Canadian-based producer Kinross Gold pulled out of the largest gold project, Fruta del Norte, saying the government refused to compromise on a 70 percent tax.
When Kinross sold the high-grade venture last October, to a company belonging to the well-regarded Lundin family, the deal sparked some optimism even though the $240 million price tag was a fraction of the $1.2 billion Kinross paid in 2008. Continued...