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Markets // Market Analysis

Bolivian miners resist Comibol restructuring plan

Friday, 21 July 2017

Miners at Bolivia's state-owned Huanuni tin mine have halted production in a dispute over a planned restructuring of Bolivia's umbrella state mining company, Comibol, local news sources have reported.

A government proposal for the restructuring of Comibol has come under strong resistance generally from the mining sector in Bolivia, with workers unions believe the restructuring will result in a reduction of social benefits by governance under a public labour law rather than the general labour rules which provide current employment rights. The Bolivian mining ministry rejects this claim and insists that the intention is to change the current Comibol model whereby the organisation is financed by providing leases to cooperatives and private partnerships to a model of greater control and oversight by the government.

The workers at Huanuni are striking because they believe the proposals will result in cuts to the workforce as well as a 3% increase in electricity rates, according to the general secretary of the Huanuni mine workers union, Elias Colque. Workers at Huanuni are also unhappy that the government has yet to agree to an acceptable pay rise for them this year with the union claiming no perceivable pay increase has been agreed for over five years. A 2017 supreme decree outlined Bolivian mine workers were eligible for a 7% salary increase subject to performance conditions.

ITRI View: Huanuni produced 6,460 tonnes of tin in 2016, down 25% from 8,574 tonnes in 2015 according to official government statistics. The weaker performance last year was largely a result of drought in the region and ageing processing infrastructure at the mine. There are no reports of production halts at the Colquiri tin and zinc mine, where Comibol has already signed labour agreements with unions about the planned restructuring. However, strikes at Huanuni and wider unrest in the Bolivian mining sector show that dispute over the proposal has clearly reached a critical point. The extent to which the production halt will impact on Bolivian tin output will depend on the nature and length of the strikes, something that is not currently clear.

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