On March 20, Barrick Gold announced that it had reached a settlement with Pakistan that will allow the company to resume their controversial Reko Diq mining project in the province of Balochistan. This is a disturbing example of international investment treaties’ chilling effect on environmentally responsible policies and public interest regulations.
Other countries facing similar corporate lawsuits must pay special attention to this case. Mexico, for example, is being sued by the U.S. mining company Odyssey Marine Exploration for $3.54 billion. Filed before the ICSID in 2019 under the terms of NAFTA, the suit challenges Mexican authorities’ decision to deny a seabed mining permit to extract phosphate (used for fertilizers) in the Gulf of Ulloa, off the coast of Baja California Sur. The Puerto Chale Fishing Cooperative had strongly opposed the project, on the grounds that their members’ livelihoods depend on the marine areas and seafloor that Odyssey is intent on dredging.
After the company retaliated by bringing a claim to ICSID, the Fishing Cooperative and the Center for International Environmental Law (CIEL) attempted to submit an amicus curiae brief to share their concerns. They also argued that the decision by Mexico’s Ministry of Environment and Natural Resources (Semarnat) to deny the exploitation permit was consistent with the precautionary principle recognized in national and international law. The ICSID tribunal refused to admit the brief. (https://bit.ly/3umy8dL)
In their recent report “A Sea of Trouble: Seabed Mining and International Arbitration in Mexico,” Jen Moore of the Institute for Policy Studies and Ellen Moore of Earthworks explain that such refusals are common in this arbitration system designed to favor transnational corporations. The majority of the panel, made up of highly paid corporate lawyers, essentially asserted that the cooperative’s contribution was “irrelevant.”
One of the three arbitrators, Phillippe Sands, did express a dissenting opinion. Not only should the cooperative be heard, Sands argued, but that the failure to admit its concerns exposes the failings of the arbitration system, with potentially far-reaching impacts on environmental protection policies in Mexico.
With Khan’s ouster in Pakistan, it’s unclear what will happen to his government’s efforts to withdraw from Bilateral Investment Treaties and the invest-state dispute settlement regime. But resisting this anti-democratic system should not be a partisan issue. All governments should have the authority to adopt economic measures in the public interest — without the threat of expensive corporate lawsuits.
Updated and translated from the original Spanish version available in La Jornada.
Manuel Pérez-Rocha is a researcher at the Institute for Policy Studies. Follow him on Twitter: @ManuelPerezIPS