This guy forgets the most important thing missing that has buried the mining sector..PERMITS!

Expropriation and high taxes bury the country's mining sector

Sep 17, 2010 1:29 PM |

The mines produced 82.27 million Bs.F. mining productivity was the last quarter of 2009.

61.28 million Bs.F. was the GDP of mining in the first quarter of 2010.

63.77 million Bs.F. was the figure who sat in GDP in the second half of this year. Pastran Gleixys C.

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One of the most depressed economic sectors in the last three years has been to mining. Gross Domestic Product (GDP) is in a tailspin since 2008, and their representatives have lost hope of any recovery.

In the latest GDP report, the Central Bank of Venezuela (BCV) revealed that the mining sector dropped by 15.2% in the first half of 2010, a fairly high rate when you take into account that the GDP was - 3.5%.

Luis Alejandro Rojas, vice president of the Venezuelan Mining Chamber (Camiven), said that beyond what is published by the BCV, the low productivity of the mines is given by the red beads of public enterprises.

"The sector is falling for some time, but not limited to small and medium industry, public enterprises have also reduced their productivity, which is evident in the numbers of BCV," says Rojas.

Among the main reasons why the mining sector has not recovered its economic productivity, Rojas mention the high taxes that should remove those engaged in the exploitation of minerals.

"The government has been attacking the industry looking for a bulk of tax revenue," says vice president of Camiven, excuse that "this is an activity whose taxes should be well studied, because they constantly are buying mining capital to work on the farm : o equipment or pay taxes, but canceled both without government assistance, it is now impossible, "he says.

In addition, mining is the second economic activity over expropriated in the country.

An evaluation of Aragua Camiven reflects that quarries are not private. "In that state, all cement industries were expropriated, so many entrepreneurs who are engaged in that business closed or sold it before they removed it."

Not to mention the expropriation of the big three cement companies such as Lafarge and Cemex.

Counting down

BCV numbers show the sensitivity of the sector. Although the bulletin does not classify by mining areas (such as coal, quarries, gold and other minerals), said that in the first half of this year the mining GDP was Bs.F. 125.05 million, compared to Bs.F. 147 410 000 2009.

However, the slump is more pronounced when analyzing its performance in the second half since 2008. The issuing entity indicates that for the past year from June to December mining productivity dropped to 11.9%.

These numbers also show a lack of investment in the sector, and less mineral companies operating in the country.

"For the miners is still very difficult to bring new equipment. In an industry where the machinery has a high level of wear, it is essential to have enough dollars to import spare parts," explains vice president Camiven