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Paraguayans oppose Rio Tinto plans

22 January, 2013At the end of 2012, Paraguayans demonstrated against the government’s decision to sign a Memorandum of Understanding (MOU) with the company. Some business sectors have also indicated their opposition to the project and have shown little interest in investing in the proposed industrial park.

On Friday 21 December 2012, the Paraguayan government signed an MOU with Rio Tinto Alcan for the development of an industrial  park where the company will build an aluminium smelter.

Paraguayans have been closely following negotiations between the government and Rio Tinto and there is a campaign called “No to the Rio Tinto coup”. A 25,000 signature petition called on the government to end negotiations with the company. On Thursday 20 December, before the signature of the MOU, a demonstration was held in front of the Ministry of Trade and Industry to protest at the planned construction of the smelter, because of its environmental  impact and because of Rio Tinto’s history of violating labour and trade union laws.

Five memorandums have to be negotiated before the government gives its definitive approval for construction of the plant, which will cost US$4 billion and have capacity for producing 674,000 tonnes of aluminium per year. Memoranda on the environment, infrastructure, taxation and energy prices are on the agenda.

Negotiations began four years ago, but stalled under the Fernando Lugo government. However, negotiations resumed after his removal from office and replacement by Federico Franco. The government that takes office on 15 August 2013 will have the final decision on the industrial park and candidates will have to make their minds up on this matter. 

Some business sectors have opposed the project because of a lack of interest in investing in the planned industrial park. Only six of the 55 companies contacted by the Ministry of Trade and Industry’s  Technical Negotiating Group (GTN) expressed an interest in building plants in the park that will have Rio Tinto smelter as its centre-piece.

The media has reported public and business opposition to Rio Tinto’s planned investment in Paraguay.

Meanwhile, the Anglo Australian mining group Rio Tinto lost US$14 billion (€10.525 billion) as a consequence of asset depreciation in Mozambique and trading in aluminium. The company dismissed its chief executive officer as a result.

IndustriALL Global Union is campaigning to shine a light on Rio Tinto’s unethical behaviour around the world. IndustriALL supported the workers at Rio Tinto Alcan’s facility in Alma, Quebec during a six-month lockout that ended in July. It will continue to support Rio Tinto employees around the world.