Venezuelan lawmakers hold open debate on mining bill to attract foreign capital

Caracas, Venezuela — CARACAS, Venezuela (AP) — Venezuelan lawmakers began debating Monday a bill proposed by current President Delsy Rodriguez to regulate the country’s mining industry and create the conditions to attract critical foreign investment.

The bill aims to instill confidence in foreign investors, many of whom have lost assets through expropriation decades ago, and draw in much-needed capital to boost the country’s industry. This partly reflects the recently approved oil-industry reform that opens the door to privatization by removing the ideology of the self-proclaimed socialist movement that has ruled the country for more than two decades.

The latest legislative action Rodriguez has proposed comes after he came under pressure from the Trump administration in January when the United States military ousted then-President Nicolás Maduro. He announced the move during US Interior Secretary Doug Burgum’s visit to the capital, Caracas, last week.

Bergum’s visit comes as the Trump administration seeks to defend against China’s stranglehold on critical minerals — some of which are abundant in Venezuela — and continues its phased plan to stabilize the South American country, which has been battered by a complex crisis that has been ravaged by nearly 13 years of Maduro’s rule.

In addition to oil, Venezuela is rich in gold, copper, coltan, bauxite, diamonds and other valuable mining resources, but unsafe working conditions are common in the poorly regulated industry. Niobium and tantalum, critical minerals and elements considered critical for smartphones and electric vehicle batteries, are extracted from coltan. Bauxite is processed into aluminum, which the US also lists as a critical mineral.

“The restoration of relations between Venezuela and the United States has led the world’s leading mining companies to evaluate the possibility of investing significant capital to reactivate sectors capable of guaranteeing the supply of critical minerals necessary for the development of the technology industry, the production of new energy sources and the production of electric vehicles,” said legislator Félix Freitas. Venezuelans.

The proposed bill would regulate mineral rights, establish small, medium and large-scale mining categories and allow for independent arbitration of disputes, seen as key to protecting against future takeovers by foreign investors. The independent arbitration provision was included in the oil industry overhaul that Rodriguez signed into law earlier this year.

The bill prohibits the President, Vice President, Ministers, Governors and others from holding mining titles.

Venezuela’s mineral-rich regions have long been controlled by guerrillas, gangs and other illegal groups that mine with the connivance of and for the benefit of the authorities and the military.

Many foreign companies that invested in Venezuela, including in the mining and oil sectors, had their assets confiscated nearly two decades ago. Then, in 2016, the Maduro government set up a massive mining development zone stretching across the country’s central region to supplement flagging revenues from its powerful oil industry, which has seen its output plummet as a result of mismanagement, corruption and, more recently, US sanctions.

Since then, mining operations for gold, diamonds, copper and other minerals proliferated. Many of the wildcat mines operate in brutal conditions and in the presence of criminal gangs, but ordinary Venezuelans flock there in hopes of getting rich quick and escaping poverty. Officials and members of the military take a cut of illegal mining revenue in order to allow the operation of mines, access to fuel and other equipment, and the transportation of minerals.

The US last week issued a sanctions license to deal with Minerven, Venezuela’s state-owned gold mining company.

Announcing the bill on Wednesday, Rodríguez told reporters it was a “victory for social well-being” in Venezuela.

“Let the Venezuelan people also see the positive aspects of having a good relationship with the world and with the United States of America,” he said.

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