Chile's miners express concern about Boric speech

Two of the main mining associations in Chile agreed that the announcements related to supporting investment and allocating more resources to state copper giant Codelco were positive points in President Gabriel Boric’s first state of the nation address. 

But the structure of the proposed state lithium company and the mining royalties were only briefly touched on.

In his speech on Wednesday, Boric highlighted the importance of economic growth and the need to recover investments to generate healthy financial conditions. He also mentioned that the government is making progress on a tax reform and is considering a mining royalty. On the national lithium company, Boric just reinforced a commitment to address the proposal.

Private mining association Sonami considers that, given the current debate on a new constitution and the increase in violence, it is key to generate legal certainties to attract investments. In addition, the association considered it was important that there be more talk about the government’s tax reform, especially about miners’ income.

"We have had a long period of uncertainty regarding the mining royalty and we still don’t know if the government will make changes to the bill that is in the senate or will present a new bill," Sonami president Diego Hernández said in a release. 

Hernández recommends modifying the scale of the current royalty known as the specific tax on mining (IEM) to increase collection, but to a limit that does not compromise investment in new projects.

The Chilean mining chamber also expressed concern about the mining announcements made by Boric. "We insist that the country will gain much more by improving the IEM than with the new royalty that is under study, which will clearly harm investment," said chamber president Manuel Viera in a statement.

The chamber also considers that the creation of a national lithium company will add more financial burden to the State. The option of using current national mining company Enami would imply less cost, it said.