Good afternoon, Mr. Chair and committee members. Thank you for the opportunity to present to you this afternoon.
I will do my best to keep my remarks short. I do hope that Juan Diego has a chance in the questions and answers to continue his recommendations to the committee.
The implementation of the Canada-Colombia Free Trade Agreement comes at a time when human rights violations in Colombia remain at crisis levels on a global scale, as well as when Colombians are fighting hard to improve protections for their collective rights in the face of a booming mining sector, which is a key area for Canadian investment in Colombia and the focus of my comments today.
The Canada-Colombia trade pact is also very much an investment agreement. Given that Canada did not have a prior investment agreement with Colombia, it provides powerful new provisions for Canadian investors. Meanwhile, it lacks binding measures to help protect human rights, labour, and the environment.
The accompanying agreement to produce an annual human rights report on the part of both the Canadian and Colombian governments was a poor substitute for the recommendation, which we supported, for an independent human rights impact assessment prior to deciding on its ratification. The tabling of the Conservative government's non-report several weeks ago reaffirms earlier suspicions that this was mere window dressing to get the agreement passed.
At MiningWatch Canada, we continue to be very worried about the potential for mining investments to perpetuate, aggravate, or benefit from serious human rights violations in Colombia, as well as the likelihood that companies might use investor-state dispute mechanisms in the agreement to put a chill effect on stronger human rights protections and democratic policy development in the country.
As you've no doubt already heard from other witnesses, Colombia is still the most dangerous place to be a trade unionist, with the highest rate of internal displacement worldwide and an overwhelming number of human rights violations taking place, particularly in mineral-rich parts of the country. Over the course of 2011, we saw threats against human rights defenders on the rise, especially against leaders of displaced communities and those seeking return to misappropriated lands, mainly by paramilitary groups.
Regarding one of the cases that was examined in the Colombian study, short weeks after the Canada-Colombia Free Trade Agreement was passed into effect last August, Father José Reinel Restrepo, a parish priest of the municipality of Marmato, in the western department of Caldas, was murdered. Restrepo was an outspoken opponent of Canadian mining company Gran Colombia Gold's proposal to construct an open pit gold mine that would require the displacement of an entire town. He had recently travelled to Bogota and spoken openly about his situation on national television.
This is not an isolated incident. There have been reports of an increase in mining companies publicly singling out communities that are speaking out about the possible impacts of their operations, which can be equivalent to a death sentence in Colombia, and there have been numerous cases of massive detentions of those protesting such megaprojects.
Protests have been frequent because, quite literally, thousands of mining, oil, and gas concessions have been granted or requested across some 40% of Colombian territory, creating a tremendous amount of insecurity, given overlap with protected natural areas and important sources of water, the territories of indigenous and Afro-Colombian people, and lands being worked for agriculture or artisanal and small-scale mining. As we're seeing elsewhere in the region, the rise in local level conflicts is also giving rise to national controversy.
In Colombia, the office responsible for granting mineral concessions has been highly criticized and has repeatedly suspended receipt of new requests for concessions during the last year. Given a backlog of some 20,000 petitions, the country also lacks the capacity to properly monitor existing mining operations, and the mining code reforms passed in 2010 were recently overturned for lack of prior consultation with indigenous organizations. Indications are that the mining code will soon be reformed again.
In other words, this is a situation that's ripe for policy reform and in which there are serious struggles to ensure stronger protection for water supplies, indigenous Afro-Colombian rights, and the livelihoods of small-scale and artisanal miners, as well as to remedy the serious harm that communities have already faced and are facing from forced displacement and armed conflict in mineral-rich areas.
With the Canada-Colombia Free Trade Agreement now in effect, however, how might a Canadian company respond should its concessions or project be suspended, revoked, rejected, or otherwise affected by a significant shift or administrative decision? Might it sue or threaten to sue the state of Colombia? Recent experience would suggest this is a strong possibility. Currently there are 137 cases pending before the International Centre for Settlement of Investment Disputes, in Washington, up from three cases before the same tribunal back in the year 2000. One-third of these cases relate to natural resources and one-half are against Latin American states.
One example we have been monitoring is a lawsuit that Vancouver-based Pacific Rim Mining launched against the state of El Salvador in 2009 for more than $77 million, after failing to obtain necessary permits to develop a gold mine. Pacific Rim was carrying out exploration in the north of the country. Shortly after it went into exploration, opposition arose among local communities over the effects they were observing on water supplies, and it was feared that this would worsen if the mine went into operation.
The company's own testimony before the Washington tribunal indicates that rather than ensuring that it had fulfilled all the requirements in El Salvador to obtain needed permits, it worked its high-level contacts to try to obtain approval. Meanwhile, the local conflict went national, and public opinion turned against metal mining, given the existence of not just one but several dozen projects across the Salvadorian highlands, and given that this tiny, densely populated country is largely reliant on a single and already overtaxed watershed. This led to a national moratorium against metal mining, which has led to a strategic environmental impact study.
Because we don't have a free trade agreement with El Salvador, the company's response was basically to move a Cayman Island subsidiary to Nevada in order to file a lawsuit in April 2009 at the International Centre for Settlement of Investment Disputes in Washington, under both the Central America-U.S. free trade agreement and a little-known Salvadorian investment law. At the same time, we saw violence occurring in the northern area of El Salvador, where the mine had been in development. Threats and murders took place and have yet to be fully investigated. Meanwhile, El Salvador has already spent some $5 million in fighting the lawsuit, and the process to reform the country's mining code drags on.
Now, in this sort of circumstance, could a group of citizens—Colombian citizens, for instance—exercise provisions in the Canada-Colombia Free Trade Agreement to effectively protect their rights? It's very unlikely. Neither the labour nor the environmental side agreements include the possibility of any punitive sanction, and disputes will only be decided by consensus. The mention of corporate social responsibility in the text of the agreement is purely aspirational and completely unenforceable.
From our perspective, given the gravity of the human rights violations that Canadian investors could be aggravating or benefiting from in conflicted parts of Colombia, the non-report that the Conservative government tabled was very upsetting. Not only was there no serious effort made to document the human rights situation in which Canadian companies are investing, but neither was there much indication that a serious report will be forthcoming. A truly independent, transparent, and participatory human rights impact assessment of the implications of the Canada-Colombia Free Trade Agreement would still be a valuable step, and it should also be contemplated in other scenarios in which we're currently pursuing agreements, such as Honduras.
Based on our own observations to date, we also think that, in particular, the investor protections included in the agreement should be an element that needs serious examination in any human rights impact assessment of Canadian free trade agreements moving forward.
From our perspective and based on our observations, we think that these provisions that allow companies to sue states in international tribunals ultimately need to be removed, given how these can enable companies to leapfrog domestic law and undermine current and future human rights protections. We think this would be a serious step forward if we're serious about promoting democracy and human rights in the region, and certainly a necessary step towards balancing out the tremendous power differential that exists today between investor and human rights protections pertaining to the extractive industry abroad.
Thank you very much.