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The flow/fund model of Conga: exploring the anatomy of environmental conflicts at the Andes–Amazon commodity frontier

Abstract

This paper aims to contribute toward improved understanding of complex ecological distribution conflicts at the commodity frontiers, where increasing metabolism in industrial societies is leading to increased environmental destruction in resource-rich countries throughout the world. The focus of this paper is the Conga gold mine project in northern Peru, where there have been violent clashes between the Minera Yanacocha mining company and the local population, represented mainly by campesinos that live in the highlands of the Andes–Amazon region. We do this by using the flow/fund model developed by Georgescu-Roegen and extended by Giampietro and Mayumi, to help us trace the anatomy of this conflict, using simplified representations of the central economic processes involved: gold mining and milk production. By complementing the concept of Ricardian land—an indestructible fund—with the concept of land materials, which is susceptible to qualitative change, and therefore can be either a fund or a flow element of the economic process, we illustrate that the gold extraction process, which treats this land material as a flow, stands in conflict with the milk production process, at least in part, because that process is using these land materials as a fund, i.e., in order to make production possible. The paper employs the concept of environmental valuation triadics, developed by Farrell, in order to explore how the boundaries—physical frontiers and temporal durations—of a specified economic process are related to flow/fund element identities. We conclude with some reflections on potential future applications for the methods employed and on the implications of our analytical results.

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Notes

  1. Defensoría del Pueblo: http://www.defensoria.gob.pe … reports the death of José Eleuterio García Rojas (40), José Silva Sánchez (35), and the teenager C. M. A. (17) in July 3, 2013, in Celendín, Cajamarca.

    La República News: http://www.larepublica.pe/06-07-2012/muertos-en-cajamarca-suben-5-mientras-la-region-vive-en-un-clima-de-tension … reports the death of Joselito Vásquez Jambo (26) and José Antonio Sánchez Huamán in July 5, 2013.

  2. The hydrogeological component of the Conga EIA was subjected to an International Expert’s Review in April 2012 as the result of public pressure questioning the quality of the EIA. However, the controversy was not solved due to criticism on the part of opponents regarding how the government selected the auditor team. Nonetheless, this Expert Review raised additional concerns.

  3. Regarding the fundamental law of Logic, the Principle of Contradiction, “B cannot be both A and non-A”…we must accept that, in certain instances at least, “B is both A and non-A” is the case. Since the latter principle is one cornerstone of Hegel’s Dialectics, I propose to refer to the concepts that may violate the Principle of Contradiction as dialectical (Georgescu-Roegen 1971, p46).

  4. A Form 10-K is an annual report required by the U.S. Securities and Exchange Commission (SEC), which gives a comprehensive summary of a public company's performance.

  5. Details of how these values were calculated are provided in Annex 1.

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Correspondence to Jose C. Silva-Macher.

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Silva-Macher, J.C., Farrell, K.N. The flow/fund model of Conga: exploring the anatomy of environmental conflicts at the Andes–Amazon commodity frontier. Environ Dev Sustain 16, 747–768 (2014). https://doi.org/10.1007/s10668-013-9488-3

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Keywords

  • Flow/fund model
  • Valuation triadics
  • Multi-scale integrated analysis
  • Andes–Amazon commodity frontier
  • Gold extraction
  • Conga conflict