Image credits: Miguel Ángel Varela Pinedo
News Article

The Mining Fund Could Return

By Paloma Duran | Wed, 09/15/2021 - 16:23

An initiative to reform the Federal Law of Rights in order to reactivate the Mining Fund has been presented to congress by the federal PAN deputy of Zacatecas Miguel Ángel Varela. If approved, more than 120 mining communities would benefit as mining companies would drive their development directly to them.

During his intervention, Varela proposed to reform articles 271 and 275 of the Federal Law of Rights regarding the Fund for Sustainable Regional Development of Mining States and Municipalities. Varela explained that he presented the initiative because Federation's Expenditure Budget did not increase the budget for Zacatecas.  "It now more important than ever that Zacatecas and its municipalities obtain that extra resource to be able to carry out the works," said Varela.

Varela recalled that the last legislature was the one that approved the elimination of trusts so that the Ministry of Finance could directly manage all resources. The decision has affected 24 states and 127 municipalities, which depended on the Fund.

The reform would be integrated with resources for mining rights and would again seek to be a development engine for mining communities. The new distribution of resources is expected to take place in territories  where mining activities were carried out. The initiative contemplates that 77.5 percent of the profits will go to the Sustainable Regional Development Fund of the Mining States and Municipalities, while 23.5 percent will go to the project's host entity.

Varela called on all legislators to vote despite the difference between parties, since they have a duty to seek the benefit of all Mexicans. The PAN party, , wrote in its twitter account “we ask all parties to be aware of this initiative of the Mining Fund that is beneficial for mining municipalities. Fighting does not generate anything or benefit Mexican citizens. It is useless to come to the legislature and raise your hand without really listening to the initiatives.”

In October 2020, the senate approved the elimination of trusts and funds from the federal government. The initiative sought to cede control to the Ministry of Finance over resources to manage them more efficiently and ensure that mining companies really contribute to the benefit of the country. With 65 votes in favor, 51 against and two abstentions, it was ruled that 109 trusts would be reviewed, adjusted and eliminated, including the Mining Fund.

The data used in this article was sourced from:  
Miguel Ángel Varela Pinedo, El Financiero, Mining Mexico
Paloma Duran Paloma Duran Journalist and Industry Analyst