One of the prime pre-investment risks to mining in Mexico is the security situation within 100 to 300 km of the mine. The multiple stakeholders within that radius and their complicated webs must be the core focus of any security review.
In parts of Mexico, mining projects can be threatened by three powerful forces: organized crime, political corruption, and ambitious union leadership. Cartels see mining projects as either a problem (because they interfere with smuggling routes) or as an extortion opportunity. Cartels do not elicit bribes directly from miners. Instead, they extort mining suppliers or take them over. The result is increased supplier costs to miners.
Successful miners in Mexico build alliances locally, at the state level and in Mexico City, where the national government resides.
There are key issues at the national level that also attract the industry’s attention, including the future of Mexico’s recently nationalized lithium sector. AMI’s 2022 Latin America Mining Risk Index provides useful guidance to mining investors as to where they should focus their mining project due diligence for Mexico (and 15 other jurisdictions), using a proprietary approach that divides risk into 7 categories and quantifies each risk category by using a total of 70 metrics.
Please click below to learn more about this unique report, the first to quantify mining risk in Latin America, and learn more about how it can help you in evaluating pre-investment risk to mining in Mexico and Latin America.
